Rurelec PLC, the electricity utility that owns and operates power generation capacity in Latin America, has announced a $600 million investment in the hydro industry in Peru.

Rurelec acquired a 50 percent interest in Cascade Hydro Limited, a newly formed hydroelectric power development company focused on run-of-river projects in December 2011. In addition to its existing 4 MW Canchayllo project, Cascade has now agreed to acquire the 255 MW Santa Rita run-of-river hydro development project for $10 million, plus an additional payment capped at $5 million in the event that certain performance targets are reached. The bulk of the consideration is payable when the project reaches financial close, which is expected to take place within six months of securing a power purchase agreement.

With a planned construction period of about 42 months post financing, the $600 million project is not expected to enter commercial operations until 2017.

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