100% to the government to win the bid. Expertshad previously estimated a cost of between USD 2bn-USD 2.5bn for the project.Those complaints were ignored, but even so in April 2012 Cristina Kirchnercanceled the contract without citing any specific reasons.Now theproject - renamed President Nestor Kirchner and Governor Jorge Cepernic - isbeing auctioned again and new players have come onto the scene. Five jointventures are bidding, with companies including Brazil's Queiroz Galvao,Construtora Norberto Odebrecht and IMPSA, which presented a new proposal.Brazil'scompanies were said to be well-positioned in the auction, but now the winningcards seem to be in the hands of Lazaro Baez, a businessman from Santa Cruz whopresented an offer together with China's Sinohydro. Baez became famous inArgentina for building an empire from nothing starting from the time NestorKirchner was first elected president in 2003. He was a low-ranked official atBanco de Santa Cruz when he first met Kirchner in the '90s. They became closefriends and continued to be for the following 20 years. During the yearsKirchner was president, Baez created a network of construction companies thatwere awarded 80% of all Santa Cruz's public works over the last 10 years. Baezexpressed his gratitude to Kirchner by building a gigantic mausoleum for theformer president in Santa Cruz's largest cemetery.Even if Baezis not awarded with the contract to build the dams, he has already securedprofit from the project. Starting in 2006, he bought over 180,000 hectares onthe right bank of the Santa Cruz river, paying around USD 7 per hectare. Thoselands will be flooded after the construction of the dams, and the government isexpected to pay compensation of over USD 100 per hectare to the owners. JorgeLanata's investigation showed that not only did Baez know in advance aboutKirchner's plans to build the dams, but he was given confidential informationon the project in 2010. Moreover, in 2012 Planning Minister Julio de Vidohimself joined Baez's men in a visit to China to get Sinohydro on board toparticipate in the new bid.Thehydroelectric works are now said to have an estimated cost of up to ARS 25bn(5bn), up from a first estimate of USD 2bn in 2007. In January 2013, SantaCruz's former governor, Sergio Acevedo, said that the project was being valuedin ARS so the cost of "premiums" could go up for many reasons."It could always be confused with inflation, in a country with a 20%annual raise in prices", Acevedo stated. The government is expected toannounce a winner for the bid at the end of May, according to our friends inthe know.In themeantime, even after these corruption accusations were made on live TV and withmillions of citizens watching, President Kirchner has not bothered to offer anexplanation or even deny the allegations. Kirchner's unconditional followershave tried to discredit Lanata's work, pointing out it has been broadcasted byone of Grupo Clarin (BA: GCLA)'s TV channels. Clarin is Argentina's largestmedia group and has long been in open conflict with the Kirchneradministration.But thescandal has hit the president's image: according to a poll by Ipsos-Mora yAraujo, Kirchner's negative image increased to 49%, from a former 40% beforeLanata's investigation was revealed. However, the investigation had