CFE will have to pay $260 million USD to a consortium of companies.

The Federal Electricity Commission (CFE) will have to pay $260 million to a consortium of companies affected during the Chicoasén II project.

MEXICO (Reforma) – After losing a lawsuit before the London Court of International Arbitration for terminating a contract due to issues that were unrelated to the companies

The Mexican companies Caabsa, Omega, and Dycusa, as well as the Chinese company Sinohydro, won in January 2015 the project to build a hydroelectric plant in Chiapas. However, the work was blocked by ejido groups and unions of the local CTM.

The plant, which would have the capacity to generate 240 megawatts, was to be built under the Financed Public Works (OPF) scheme, for 323 million dollars, but only made 23 percent progress due to 23 interruptions during the execution of the work.

The last blockade on the work was lifted on June 21, 2017, following intervention by the state government, and on Aug. 18 of that year, the contractor filed an arbitration claim for causes attributable to the CFE, which was then in charge of Jaime Hernández.

In March 2018, the CFE terminated the contract, attributing the contractor’s non-compliance.

The CFE, now headed by Manuel Bartlett, announced its intention to challenge the London Court of International Arbitration’s decision before a national jurisdiction since the ruling was based on the obligation to free the construction site, which was not the responsibility of the state-owned company.