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Cochabamba Water Dispute Settled

January 19, 2006 The Government of Bolivia and the international shareholders of Aguas del Tunari S.A. (“Aguas del Tunari”) have settled their dispute over the concession for the supply of water services and related contracts to the city of Cochabamba.

The Government of Bolivia and the international shareholders of Aguas del Tunari declare that the concession was terminated only because of the civil unrest and the state of emergency in Cochabamba and not because of any act done or not done by the international shareholders of Aguas del Tunari (Bechtel, Befesa, Abengoa and Edison).

As a result of the settlement, the claims against Bolivia currently before the International Centre for Settlement of Investment Disputes will be withdrawn. There will be no compensation paid by the Government of Bolivia or Aguas del Tunari for the termination of the concession and the withdrawal of the claim.

The concession agreement dates from 3 September 1999, when the Government of Bolivia approved Aguas del Tunari as the concessionaire to provide water services to the city of Cochabamba. On 10 April 2000, the concession was terminated for the above stated reasons, giving rise to a dispute between Bolivia and Aguas del Tunari.