Resolution 144/2011

BOARD RESOLUTION NO. 144/2011
SUBJECT: MONETARY OPERATIONS MANAGEMENT – APPROVES REQUEST TO MODIFY CONTRACT SANO NO. 148/2011 – CREDIT FOR THE ENDE PROJECT "EMERGENCY PLAN FOR THE SUPPLY OF ELECTRICITY IN THE NATIONAL INTERCONNECTED SYSTEM (SIN)"

HAVING SEEN:

Central Bank of Bolivia (BCB) Law No. 1670 of October 31, 1995.
The General State Budget for the 2010 Management Period (PGE-2010).
Law No. 050 of October 9, 2010, modifying the PGE.
Law No. 062 of November 28, 2010, approving the General State Budget for the 2011 management period (PGE – 2011).
The Regulation for the Granting of Credit to National Strategic Public Enterprises within the framework of the General State Budget for the 2010 and 2011 Management Periods, approved by Board Resolution No. 23/2011 of February 22, 2011, and modified by Board Resolutions No. 26/2011, No. 27/2011, and No. 30/2011 of March 2, 18, and 22, 2011, and No. 097/2011 of August 9, 2011.
Board Resolution of the Central Bank of Bolivia No. 041/2011 of April 15, 2011.
Contract SANO No. 148/2011, for Extraordinary Credit under Concessional Conditions granted within the framework of the 2010 General State Budget (PGN) and Laws No. 50 and No. 62, of April 14, 2011.
The Addendum to Contract SANO No. 287/2011 of August 23, 2011.
Board Resolution of ENDE No. 016/2011 of July 26, 2011.
Ministerial Resolution of the Ministry of Hydrocarbons and Energy No. 317-11 of August 3, 2011.
Note from the National Electric Company (ENDE) CB-CA-GGN-8/5-11, of August 3, 2011.
Report from the Economic Policy Advisory BCB-APEC-SSMF-INF-2011-21 of August 9, 2011.

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Report from the Monetary Operations Management BCB-GOM-SOSP-DCE-INF-2011-10 of August 9, 2011.
Report from the Legal Affairs Management BCB-GAL-SANO-2011-277 of August 9, 2011.
Note from the National Electric Company CB-CA-GGN-8/10-11, of August 11, 2011.
Note from the Ministry of Economy and Public Finance MEFP/VTCP/UEPS-1379/2011, of August 31, 2011.
Report from the Legal Affairs Management BCB-GAL-SANO-INF-2011-289 of September 9, 2011.
Note from the Central Bank of Bolivia BCB-PRES-CE-2011-1036 of October 25, 2011.
Note from the National Electric Company ENDE.GGN-10/39-11, of October 31, 2011.
Report from the Monetary Operations Management BCB-GOM-SOSP-DCE-INF-2011-12 of November 4, 2011.

CONSIDERING:

That, in accordance with what is established in the PGE for the 2010 Management Period, Law No. 050 modifying the 2010 PGE, and Law No. 062 approving the PGE for the 2011 management period, the Board of the BCB, through Board Resolution No. 23/2011 of February 22, 2011, approved the Regulation for the Granting of Credit to National Strategic Public Enterprises within the framework of the General State Budget for the 2010 and 2011 Management Periods, subsequently modified by Board Resolutions No. 26/2011, No. 27/2011, No. 30/2011, and No. 097/2011, of March 2, 18, and 22, 2011, and August 9, 2011, respectively.

That, within the legal framework described, pursuant to Resolution No. 041/2011, the Board of the Central Bank of Bolivia approved the granting of an extraordinary concessional credit to the National Electric Company (ENDE) and authorized the Acting President of the BCB to sign Contract SANO No. 148/2011 for Extraordinary Credit under Concessional Conditions granted within the Framework of the 2010 General State Budget and Laws No. 50 and No. 62, for the project "Emergency Plan for the Supply of Electricity in the National Interconnected System," with ENDE and the Ministry of Hydrocarbons and Energy.

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That Contract SANO No. 148/2011 stipulates, among other aspects, the following:

• The object of the contract is the granting of an extraordinary credit under concessional conditions by the BCB in favor of ENDE up to the equivalent of Bs1,227,205,000.- (fourth clause).
• ENDE will use and allocate under its exclusive responsibility the resources from the credit for the financing of the project "Emergency Plan for the supply of electricity in the National Interconnected System (SIN)," in accordance with Ministerial Resolution No. 147/2011 of the Ministry, dated April 6, 2011 (fifth clause).
• The credit conditions established in the sixth clause are as follows:
  • Currency: Bolivianos
  • Total Credit Amount: Bs1,227,205,000.-
  • Term: 20 years
  • Grace Period: 5 years on principal with interest payments calculable from the first disbursement
  • Annual Interest Rate: 0.86%
  • Penalty Interest: Form and scale provided in Article 2 of D.S. No. 28166 and its modification via D.S. 530.
  • Deadline for Disbursements: Until April 30, 2013
  • Payment Plan: Annual
  • Disbursement Schedule: According to the disbursement schedule approved by the ENDE Board via Board Resolution No. 005/2011
  • Guarantee: Treasury Bonds
• In the event that the Investment Plan or the Disbursement Schedule is subject to modification, ENDE must provide proof of corresponding approval by its Board and communication to the Ministries of Development Planning and the MHE (ninth clause).

That by Contract SANO No. 287/2011, an Addendum to Contract SANO No. 148/2011 was signed, by which the nature of the contract is clarified, stating that it constitutes a draft with the value of a private document while it is notarized before the Notary of the Departmental Government of the Department of La Paz.

That by Note CB-CA-GGN-8/5-11, ENDE requests information on the procedure to be followed in order to formally materialize the modifications to the Investment Plan and Disbursement Schedule of the "Emergency Plan for the supply of electricity in the National Interconnected System (SIN)," attaching for this purpose Ministerial Resolution No. 317, of August 3, 2011; Board Resolution No. 016/2011, of July 26, 2011; and Notes CB-CA-GGN-7/31/11; CB-CA-GGN-7/32-11; and CB-CA-GGN-7/38-11, all dated July 26, 2011, by which the modification to the investment plan and disbursement schedule is communicated to the Ministries of Development Planning, Economy and Public Finance, and Hydrocarbons and Energy, and forwards the documentation required for the approval of credits established in the corresponding Regulation.

That Ministerial Resolution No. 317/2011, of the Ministry of Hydrocarbons and Energy, in attention to ENDE Board Resolution No. 016/2011, determined to modify Ministerial Resolution No. 147/2011, ordering the following:

• Determine that, in accordance with the National Development Plan, the execution of the projects for Equipment, Construction, and Assembly of Generator Groups in Trinidad, La Cumbre Substation, and improvements to the Distribution Networks of Trinidad, San Borja, and Yucumo of the Emergency Plan for the supply of electricity in the National Interconnected System – SIN, are of national priority, which will be executed by ENDE, for which a credit of Bs157,150,000.- will be requested from the BCB, the amount of which will be destined to the aforementioned projects and the future flows will be used for the payment of the credit (First).
• Confirm the technical feasibility of the execution of the projects for Equipment, Construction, and Assembly of Generator Groups in Trinidad, La Cumbre Substation, and improvements to the Distribution Networks of Trinidad, San Borja, and Yucumo of the Emergency Plan for the supply of electricity in the SIN (Second).
• ENDE is tasked with managing the modification of Contract SANO No. 148/2011 of April 15, 2011, signed with the BCB, reducing the amount of said concessional loan from Bs1,227,205,000 to Bs157,150,000, in accordance with what is established in this Ministerial Resolution, as well as to complement the documentation or information that said entity requires (Fourth).

That in said Ministerial Resolution, ENDE is instructed to manage the modification of Contract SANO No. 148/2011, reducing the amount of the credit from Bs1,227,205,000.- to Bs157,150,000.-

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That the Economic Policy Advisory, through report BCB-APEC-SSMF-INF-2011-21, concludes that the amounts requested by ENDE for the project "Emergency Plan for the Supply of Electricity in the National Interconnected System SIN" are part of the BCB financing to the General Government Sector (SPNF) provided for in the Monetary Program of the 2011 management period, which was incorporated into the Execution Decision of the 2011 Fiscal-Financial Program signed between the MEFP and the BCB on February 9, 2011. The reduction in the amount requested for this credit will not affect the fulfillment of the Program's targets.

That the Monetary Operations Management, through Report BCB-GOM-SOSP-DCE-INF-2011-10, concludes that "the request by ENDE for the modification of the Investment Plan and Disbursement Schedule implies the modification of the amount approved for the Project: 'Emergency Plan for Electricity Supply to the SIN' through Board Resolution No. 041/2011 and Contract SANO 148/11 from Bs1,227,205,000.- to Bs157,150,000.-, a modification that does not affect the financial conditions of the mentioned credit, except for the approved amount thereof. If the modification requested by ENDE is approved, the Titles issued on May 6, 2011, by the Ministry of Economy and Public Finance for this credit (Series: TGNENDE-G1A-11) must be replaced, proceeding to cancel them and replace the Non-Negotiable Titles of the First Disbursement of Bs64,570,189.- which are currently in custody." The request raised by ENDE, being provided for in the ninth clause of Contract SANO 148/11, should be addressed prior to the respective analysis and legal opinion.

That the Legal Affairs Management of the BCB, through Report BCB-GAL-SANO-2011-277, concludes that: "with respect to the modification of the Investment Plan and Payment Schedule, ENDE has complied with the presentation of the documentation established in the ninth clause of Contract SANO No. 148/2011, on the basis of which it must request the BCB Board to modify the credit conditions that were authorized with Board Resolution No. 041/2011 and Contract SANO No. 148/2011, corresponding to the technical area to determine the relevance and technical viability in order to approve the modification of the credit conditions, emerging from the new Investment Plan and Payment Schedule and considering it pertinent to authorize the signing of an Addendum with other credit conditions."

That by note CB-CA-GGN-8/10-11, ENDE communicates to the BCB the modifications to the Investment Plan and Disbursement Schedule of the "Emergency Plan for the supply of electricity in the National Interconnected System," for which it formally requests the Issuing Entity to modify Contract SANO 148/2011.

That the Ministry of Economy and Public Finance, through note MEFP/VTCP/UEPS-1379/2011, communicates the need to swap the Treasury Bond delivered to the BCB on May 16, 2011, because the physical coupons establish the total amount of the credit initially subscribed at Bs1,227,205,000.-

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That the Legal Affairs Management of the BCB, through Report BCB-GAL-SANO-INF-2011-289, establishes that since the modification of the Investment Plan and the Disbursement Schedule of the Credit Resources granted by the BCB in favor of ENDE was approved by ENDE Board Resolution No. 016/2011 and Ministerial Resolution No. 147/2011 was modified, reducing the amount of the concessional loan from Bs1,227,205,000.- to Bs157,150,000.-, the modification of Contract SANO No. 148/2011 regarding its quantity corresponds, and it corresponds to specify the destination of the resources in the respective addendum, since there is no legal impediment to proceed with the modification of the credit contract SANO No. 148/2011, within the framework of what is determined in Ministerial Resolution No. 317/2011 of the Ministry of Hydrocarbons and Energy and other antecedents.

That by note from the Issuing Entity BCB-PRES-CE-2011-1036, ENDE is communicated that in attention to the terms of its notes CB-CA-GGN-8/5-11 and CB-CA-GGN-8/10-11 and with the purpose of completing the corresponding analysis, to send to the BCB the reformulation of the Disbursement Schedule, approved by Board Resolution No. 016/2011, considering that the First Disbursement was already made on May 6, 2011.

That by Note ENDE-GGN-10/39-11, the National Electric Company communicates to the BCB that pursuant to what is established in the ninth clause of Contract SANO No. 148/2011, the ENDE Board in Board Resolution No. 016/2011 has approved the reformulation of the Disbursement Schedule of said credit, which has motivated the issuance of Ministerial Resolution No. 317/11, which modifies Ministerial Resolution No. 147/11 and, in that framework, may request scheduled disbursements and undistributed disbursements at a later date than the established dates. In this sense, according to the procedure approved by the BCB, authorization has been requested from the Ministry of Hydrocarbons and Energy for these disbursements.

That through Complementary Report BCB – GOM – SOSP – DCE – INF – 2011 - 12, the Monetary Operations Management concludes i) that the request by ENDE for the modification of the Investment Plan and Disbursement Schedule implies the modification of the amount approved for the Project "Emergency Plan for Electricity Supply to the SIN" through Board Resolution 041/2011 and consequently, the modification of Contract SANO 148/11 from Bs1,227,205,000.- to Bs157,150,000.-; ii) and that the aforementioned modification does not affect the rest of the financial conditions of the mentioned credit, except for the approved amount thereof; iii) if the modification requested by ENDE is approved, the Non-Negotiable - Amortizable Treasury Bond composed of 20 installments, issued by the Ministry of Economy and Public Finance as guarantee for the First Disbursement of Bs64,570,189.- made on May 6, 2011, must be replaced.

That pursuant to what is provided in Article 44 of Law No. 1670 of October 31, 1995, the highest authority of the BCB is its Board, responsible for defining its policies and

//7. B.R. No. 144/2011 specialized regulations of general application and internal norms, as well as establishing administrative, operational, and financial strategies. To this effect, it is empowered to adopt general decisions that may be necessary for the BCB to comply with its functions, competencies, and faculties recognized by legal mandate, as well as to assume the attributions that are necessary for the fulfillment of its functions (Art. 54 Incs. a and q).

That as established by the aforementioned Law, the President is the first executive authority of the Institution (Art. 57) and has the attribution to exercise the legal representation of the BCB (Art. 59 Inc. e).

THEREFORE,
THE BOARD OF DIRECTORS OF THE CENTRAL BANK OF BOLIVIA RESOLVES:

Article 1.- Approve the modification to Contract SANO No. 148/2011 for Extraordinary Credit under Concessional Conditions granted within the Framework of the 2010 General State Budget and Laws No. 50 and No. 62, reducing the amount of the loan to Bs157,150,000.- (One Hundred Fifty-Seven Million One Hundred Fifty Thousand 00/100 Bolivianos. In the respective Addendum, the use and destination of the resources must be specified within the framework of the Resolution of the Ministry of Hydrocarbons and Energy No. 317/2011 of August 3, 2011, and the amount of the credit conditions must be modified.

Article 2.- Authorize the President of the BCB to sign the corresponding document, with the National Electric Company under the terms of this Resolution.

Article 3.- The Presidency and the General Management are tasked with the execution and compliance of this Resolution.

La Paz, November 8, 2011

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Marcelo Zabalaga Estrada

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________________________ _________________________ Rolando Marín Ibáñez Hugo Dorado Araníbar ________________________ _________________________ Gustavo Blacutt Alcalá Rafael Boyán Téllez