San Matias is situated in the Department of Santa Cruz, Bolivia, adjacent to Brazil’s Mato Groso and is not linked to Bolivia’s national grid. It serves as one of the main transit points for road transport between Bolivia and Brazil and improvement of the reliability of the power supply in the immediate area has been a key aim of the Bolivian government.

Guaracachi has acquired a Deutz gas engine for immediate delivery. This would be the company’s first installation of a gas engine for isolated generation and the government of Bolivia has agreed terms for a premium capacity payment for the project. The Deutz unit is expected to commence services in the fourth quarter of 2009.

The construction of the power plant would commence immediately, since all the required licenses and approvals have been received.

Rurelec is exploring other expansion possibilities in Bolivia by way of public – private partnership initiatives with the government of Bolivia.