The relocation responds to sustained pressure from Entre Ríos Governor Rogelio Frigerio, who has lobbied for more than a year to move the project over concerns about visual and environmental impacts on Colón’s tourism-dependent economy. Frigerio cited fears of repeating the bilateral tensions that arose from the Botnia pulp mill dispute decades earlier. The original location sparked immediate alarm on the Argentine coast, with local authorities demanding relocation to protect regional economic activities.
Paysandú Mayor Nicolás Olivera publicly disclosed that authorities are considering a 48-hectare site in Nuevo Paysandú owned by state oil company Ancap. This alternative location offers closer access to rail, national highways, and energy infrastructure while remaining categorized for industrial use. Olivera stated the site sits nearer to biogenic CO2 sources and falls outside Argentina’s area of concern. He emphasized the relocation idea originated from internal analysis showing superior conditions rather than solely from Argentine demands.
The joint communiqué issued by both foreign ministries indicated Quirno expressed satisfaction with Uruguay’s sovereign analysis of alternative locations, which considers Argentine interests in preventing harm to riverside communities dependent on optimal river usage. Lubetkin confirmed Uruguay will submit notification to the CARU bilateral river commission once location and environmental assessment decisions are finalized, activating consultation mechanisms established under Articles 7-13 of the Uruguay River Statute from the 1960s.
HIF Global declined to comment following the announcement. The company signed a memorandum of understanding with Uruguay and submitted environmental impact study terms of reference currently under evaluation by Uruguay’s Environment Ministry. A critical unresolved issue remains energy pricing, with HIF Global seeking $40 per megawatt-hour while Uruguay’s energy ministry considers this figure unacceptable. The government and company agreed to another deadline extension in early April to resolve the pricing bottleneck.
The facility is designed to produce 880,000 tons of synthetic e-fuels annually, with first exports targeted for 2029 to Asian and European markets. The Uruguayan government is working to ensure the HIF project can coexist with Ancap’s portland cement plant operations in the department.
This article was curated and published as part of our South American energy market coverage.
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