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Tracing fortunes in Panama

FITCH RATINGS COMPANY IN New York has assigned a rating of ‘BBB-‘ to the proposed $17M bond issue by Empresa de Generacion Electrica Fortuna S.A. for the Fortuna hydro project in Panama. Fitch said the assigned rating reflects Fortuna’s position as the largest hydroelectric plant in Panama; its competitive dispatch position supported by a large storage reservoir; its sound operating strategy to optimise contract electricity sales; acceptable projected debt-service coverage under various stress scenarios; and lack of foreign-exchange risk. Fortuna is a hydroelectric generating company located in the western portion of Panama. The company has an installed capacity of 300MW and generated 1480GWh in 2001. Fortuna is 49% owned by Americas Generation Corp, which is indirectly owned by Hydro-Quebec and El Paso Corporation.

AGC acquired the company by submitting the winning bid of US$118 million during the privatisation process in 1998. The company owns two concessions, initially until 2048, to operate the hydroelectric plant and use related water resources, respectively, for the generation and sale of electricity.