Call for public tender for the sale of the shares of Alicurá Hidroeléctrica S.A., Chocón Hidroeléctrica S.A., Cerros Colorados Hidroeléctrica S.A. and Piedra del Águila Hidroeléctrica S.A.
Departaments of Energy and Public Law Report| Call for public tender for the sale of the shares of Alicurá Hidroeléctrica S.A., Chocón Hidroeléctrica S.A., Cerros Colorados Hidroeléctrica S.A. and Piedra del Águila Hidroeléctrica S.A.
Within the framework of the privatization process of Energía Argentina S.A. (ENARSA), in view of the expiration of the concessions for the operation of the hydropower plants in the Comahue region and based on the authorization under Decree N° 564/2025 for the sale of the entire stock package of Alicurá Hidroeléctrica S.A., Chocón Hidroeléctrica S.A., Cerros Colorados Hidroeléctrica S.A. and Piedra del Águila Hidroeléctrica S.A. (the “Hydropower Companies“), through Decree N° 590/2025 (BO 08.18.2025), the Federal Executive Branch ordered the transfer of the shares owned by ENARSA in said companies and the sale thereof through a national and international public tender (the “Public Tender“).
The Decree also established guidelines for the interim operation of the Alicurá, Chocón, Cerros Colorados and Piedra del Águila hydropower plants by the current concessionaires.
The formal call for the Public Tender was approved by Resolution N° 1200/2025 of the Ministry of Economy (BO 08.20.2025), which:
– ordered the commencement of the sale process of the shares of the Hydropower Companies (Class “A” shares 51%, Class “B” shares 47% and Class “C” shares 2%);
– instructed the competent unit of the Agency for the Transformation of Public Companies to coordinate the necessary actions to complete the sale before December 31, 2025, and to hire a financial institution belonging to the national public sector to carry out an appraisal of the share package of each of the companies;
– authorized the call for Public Tender; and
– approved the terms and conditions of the Public Tender (the “Bidding Terms“).
The schedule that emerges from the Decree and the Bidding Terms is tight, which is consistent with the intention of the Federal Government to complete the sale process before December 31, 2025. In fact, according to Resolution ME N° 1200/2025, the execution of the transfer agreements should take place within 10 days following notice of the pre-award, and the taking of possession of the hydropower plants should take place within 15 days following the execution of the transfer agreements.
Please find below a summary of certain relevant aspects of the Public Tender and the Bidding Terms:
Publication of the call for Public Tender
The information corresponding to the Public Tender shall be published in the Official Gazette, the Ministry of Economy’s website, the website of the CONTRAT.AR platform and on www.dgmarket.com.
A virtual data room will be made available including the background information related to each hydropower complex, its operation, works to be carried out, deadlines, associated goods and facilities, etc.
The possibility of requesting visits to the different hydropower plants is foreseen, at the cost of the bidders.
Deadline for consultations on the Specifications
October 13, 2025, at 5 p.m.
Deadline for submission of tenders
October 23, 2025, at 4 p.m. Bids may be submitted within the previous 5 days. On that date, complete offers (technical and economic offer) must be submitted.
Availability of the Bidding Terms
The Bidding Terms will be available on the website of the CONTRAT.AR platform, at no cost to interest parties.
Date of opening of envelope N° 1 (technical offer)
October 23, 2025 at 5 p.m.
View of the tender files and observations
The Bidding Terms provide for the possibility of accessing the tender files, including the bids submitted by other interested parties, and making observations to the offers, within certain deadlines and subject to specific requirements.
Potential bidders
– National or foreign individuals or legal entities. In the case of foreign companies, the offers must be submitted through locally incorporated vehicles or vehicles undergoing local registration (which process must be completed before the execution of the transfer agreement).
– The submission of bids by JVs or collaboration groups is not allowed.
– If the bidder is (or its affiliates are) a generator agent of the Wholesale Electricity Market (WEM), the bidder’s power generation (computing the power generation of companies of the same economic group) plus the generation it seeks to control through the participation in the Public Tender may not exceed 20% of the aggregate electricity supply of the Argentine market.
– Among other requirements, bidders must meet certain minimum requirements in terms of asset ownership (USD 300 million) and net worth (USD 150 million).
Limits on offers
While any bidder may submit bids in relation to the four (4) Hydropower Companies, no bidder may be awarded more than two (2) of them.
Operator
A technical operator must be appointed for the hydropower plant who must comply with certain conditions provided for in the Bidding Terms. If the operator is not the bidder, it must be a member of the bidder, with a participation of at least 25%.
The designated operator shall be responsible for the technical operation of the hydropower complex during, at least, the first 5 years of operation.
Economic group. Change of control. Investment company
– Specific rules apply to the submission of bids by economic groups.
– Restrictions apply in case of change of control of the bidder during the first 5 years of operation.
– The Bidding terms allow different participants to submit a joint bid through an investment company. Specific requirements apply in such scenario.
Offer Maintenance Guarantee
USD 5 million.
Offered price
– It must be denominated in US dollars.
– The Bidding Terms allow improving the economic offer in the event of a difference equal to, or less than, 10% between the best qualifying offer and other bids.
– The form of transfer agreement states that payment shall be made within three (3) days following the publication or notification of the award to the successful bidder, whichever occurs first.
Taking of possession
It will take place on the date provided for in each transfer agreement and will include, inter alia:
– the transfer of the shares to the awardees and the constitution of a share pledge on the class “A” shares in favor of the Federal State (see details below);
– the delivery to the respective Hydropower Company of the concession assets (on an as-if, where is basis); and
– the corresponding board of directors and shareholders meeting minutes shall be signed covering the appointment of the new authorities, the ratification of the concession contracts and other documentation provided for in the Bidding Terms, the approval of the performance of the resigning authorities, the acceptance of the concession assets and the ratification of the obligations set forth under the transfer agreement.
Transition Period
A transition period is foreseen between the execution of the transfer agreement and the taking of possession during which the awardees and the current concessionaires must define certain issues, such as the transfer of personnel and the assignment of other contracts. The Bidding Terms and the transfer agreement provide specific rules regarding these assignments.
Limitations on the Transfer and Encumbrance of Class A Shares
Temporal limitations are established on the transfer of, and constitution of liens on, the class “A” shares, but not with respect to the class “B” and “C” shares, which may be freely transferred even through public offering mechanisms.
In the of participation in the Hydropower Companies through an investment company, temporary restrictions shall apply in terms of change of control in the investment company.
Share pledge
The awardee must pledge in favor of the Federal State its class “A” shares in the corresponding Hydropower Company in guarantee of the fulfillment of the Hydropower Company’s obligations under the concession contract.
Provincial oversight
The Provinces of Río Negro and Neuquén shall have the right to appoint an overseer in each Hydropower Company which shall participate in the board of directors’ meetings, with voice but without vote.
Some relevant considerations of the form of concession contract
-Term: 30 years
– Remuneration: monthly payments for available capacity and associated energy, in accordance with the calculation formulas provided for in the form of contract.
– A percentage of the energy generated will be marketed in accordance with the prices of the concession contract, while the remaining percentage will be freely marketable by the Hydropower Company through freely agreed term contracts or in the spot market. These percentages are set at 95% and 5%, respectively during the first two years. Subsequently, the percentages shall be annually and gradually reduced and increased until they reach 100% freely marketable energy from concession year 21 onwards.
– Section 15, Law N° 15,336 canon: 2% of the mounts considered for the calculation of the royalty.
– Royalty: 12% of the sale price of the energy generated, calculated in accordance with the terms of the concession contract.
– Provincial fee for the use of water resources: 2% (shared between both provinces) of the total income from the aggregate capacity and energy remuneration
– Performance Guarantee: USD 75,000 per MW, to be adjusted in accordance with the US PPI.
– Assignment of contractual position subject to prior authorization.
– The concession contract regulates the cases of termination due to the State’s default and the amount to be paid to the concessionaire in such a case, the imposition of penalties to the concessionaire for the breach of specific obligations and the termination of the concession due to concessionaire’s default and its consequences.
– Applicable law: Argentina
– Jurisdiction: Federal Administrative Courts of the City of Buenos Aires.
Please let us know in case you have any question on these matters.
Sincerely,