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Paraguay's Troche Distillery Project Stalled Amid Legal Battles and Financial Losses
🇵🇾 Paraguay /Economy & Trade

Paraguay's Troche Distillery Project Stalled Amid Legal Battles and Financial Losses

From ABC Color · (8m ago) Spanish Critical tone

Translated from Spanish, summarized and contextualized by DistantNews.

TLDR

  • The construction of a grinding mill for the Mauricio José Troche distillery in Paraguay remains stalled due to legal disputes over a terminated contract with EISA.
  • Petropar, the state-owned oil company, acknowledges significant operational losses and high production costs at the existing distillery.
  • The company is seeking a Supreme Court ruling to lift a preliminary injunction that prevents it from pursuing new solutions for the project.

The Mauricio José Troche distillery, a key state-owned enterprise, finds itself in a prolonged crisis, with its ambitious grinding mill project paralyzed and the existing alcohol plant operating at a substantial deficit. The legal entanglement stems from the termination of a contract with the firm EISA in 2024, following allegations of over-invoicing. However, EISA's successful challenge, securing a preliminary injunction from the Court of Accounts, has effectively frozen Petropar's ability to move forward, whether by renegotiating with EISA or seeking alternative solutions.

The administrative resolution that rescinded the contract is currently suspended.

— Iván FilártigaLegal Director of Petropar, explaining the impact of the court's injunction.

Petropar's president, William Wilka, and his legal team presented a stark picture to the Senate's Directive Board. The current operational reality is dire: producing a liter of alcohol costs approximately 11,000 guaraníes, while Petropar can purchase the same amount from the private sector for nearly 6,000 guaraníes. This unsustainable cost structure, coupled with minimal production that covers only 15-20% of the company's needs, highlights the urgent need for resolution. The company has appealed the injunction to the Supreme Court, hoping to untangle this legal knot and allow for progress.

We requested that the precautionary measure be lifted and that Petropar can proceed, either with a new process or with other alternatives.

— Iván FilártigaStating Petropar's objective in appealing to the Supreme Court.

The situation is further complicated by the relatively low bond EISA posted (around 500 million guaraníes) in the ongoing legal battle, especially when contrasted with the original contract value of approximately US$ 30 million and an advance payment nearing US$ 7 million. This disparity raises questions about the fairness and efficiency of the legal process in resolving such significant infrastructure disputes. From our perspective at ABC Color, this saga underscores a critical need for greater transparency and efficiency in public contracts and project management, ensuring that vital state assets are not held hostage by protracted legal battles that drain public resources and hinder national development.

They were approximately 500 million guaraníes.

— Iván FilártigaRevealing the amount of the bond posted by the contractor EISA.
DistantNews Editorial

Originally published by ABC Color in Spanish. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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