Compliance Advisor Ombudsman

Complaint

The Pando Montelirio project, approved by IFC on February 4, 2010., consists of two run-of-river hydroelectric power plants to be operated in cascade on the Chiriquí Viejo River in Western Panama.  The plants, totaling 85 MW in installed capacity (Pando, 33 MW and Monte Lirio, 52 MW), are being developed by Electron Investment, S.A. a joint venture between Inveravante Inversiones Universales S.L. of Spain, and the Panamanian entity Grupo Eleta. The total project cost is estimated to be $291.7 million. 

In January 2010, sixteen community and environmental organizations based in the Chiriqui province filed a complaint with the CAO citing a number of social and environmental concerns, including: lack of participative consultation process with communities; lack of a cumulative impact assessment; possibility of flooding to communities downstream; endangering of fish and other species; over-exploitation of water resources and the river; limited community access to water; high levels of sedimentation that affect water quality and downstream water treatment facilities (such as Baru); and negative impacts on the natural landscape and on mangroves located near the mouth of the river in the Gulf of Chiriqui.

CAO Action

To better understand views and perspectives of all stakeholders on the ground, a CAO Ombudsman team traveled to Panama in June 2010 to meet with complainants, company, community members, and local and national authorities. In July, the team returned to the field to discuss the draft assessment report and next steps with stakeholders. Key stakeholders agreed to continue to work with CAO Ombudsman in addressing the issues raised through a facilitated dialogue process.

Status

CAO has completed its assessment and with the agreement of the parties concerned is facilitating a dialogue process for key stakeholders to help improve mutual understanding and address their concerns.

The Inter-American Development Bank (IADB) is also providing long term financing to the Pando-Monte Lirio project, and the complaint received by CAO was also submitted to their Independent Consultation and Investigation Mechanism (known by its Spanish acronym, MICI) by the same complainants.  Therefore, CAO is coordinating closely with IADB staff and MICI.