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Key struggles to push Chilean investments

Saturday 09 Mar 2013 6:03p.m.

Key struggles to push Chilean investments

The Prime Minister's gruelling schedule on his South America trip appears to be getting to him. At a public event, John Key looked exhausted and struggled to keep his eyes open.

Even in Chile, Mr Key could not escape questions about the sale of Mighty River Power. It has a risky Chilean investment that is losing the company tens of millions of dollars.

Another day, another country, and another guard of honour – this afternoon, under the sizzling Chilean sun, the Prime Minister looked as if he was struggling.

The gruelling schedule – 15 flights in 10 days – appeared to be getting to him. But Mr Key kept going, today visiting the plush New Zealand ambassador's residence in Santiago.

“The residence here is beautiful,” says Mr Key. “If my treasury ever finds out we own it, they'll want to sell it.”

But what Treasury will actually be more concerned about in Chile is Mighty River Power's geothermal investments. The company, which is soon to be partially privatised, has invested tens of millions in Chile and is struggling.

At the geothermal plant in southern Chile, Mighty River Power has spent $250 million, but has just written off $89 million as the investments struggle.

“There is always risk,” says Mr Key.

Mighty River Power says the problems in Chile come from delays. It had the worst winter in 40 years. Only one of two wells is performing. Overall, it says the plant was less productive and more expensive than expected.

Mr Key certainly doesn't want to face fire over Mighty River Power at the moment. The Government is about to sell it.

So, Mr Key doesn't seem worried as his whirlwind tour continues. He still has seven flights to endure on this tour before arriving home next week.

3 News

 
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22-08-2014 12:00