The Xalalá Dam, declared a renewed national priority under Otto Pérez Molina’s administration, is now one step closer to construction. Late last year, the National Electrification Institute (INDE) bypassed the standard bidding procedure and signed a so-called “emergency contract” with Brazilian company Intertechne Consultores, S.A., to conduct the geological feasibility studies required to begin the dam construction.
The back-door deal became a necessity to move the project forward given that twice in the past six years, the Guatemalan government attempted and failed to fill the contract. On both occasions, foreign companies cited strong community opposition and lack of social license for the mega-project as key factors in their decisions not to bid. Facing forced displacement, loss of land and destruction of livelihoods, communities from the three affected municipalities in northern Guatemala – Ixcán, Uspantán and Cobán – made their voices heard, rejecting the project through community referenda in 2007 and 2010. Just how far will INDE go?