TCRLA_Public/031217.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                   L A T I N   A M E R I C A

          Wednesday, December 17, 2003, Vol. 4, Issue 249

                          Headlines

A R G E N T I N A

ACINDAR: Majority of Creditors Approve APE
ADDAR: Court Declares Company Bankrupt
AGEA: Debt Offer Gets Much-Needed Backing From Creditors
AMEXA: Enters Bankruptcy on Court Orders
BROOKER: Receiver Verifies Claims in Bankruptcy

CAMMESA: To Use A Portion of Salex Funds to Settle $350M in Debt
CLINICA CRUZ AZUL: Court Approves Reorganization Petition
DENT SUR: Receiver Verifies Claims in Bankruptcy
EASA: $200M of Bonds Get Default Ratings From Fitch
EDEMSA: Argentine Fitch Rates $150M of Bonds `D(arg)'

EDENOR: Argentine Fitch Issues Default Ratings on $600M of Bonds
EDESUR: $450M of Bonds Get `B(arg)+' from Local Fitch
EDITORIAL AGEDIT: Court Orders Bankruptcy
FAINGOLD CAVALLERA: Seeks Court's OK on Reorganization Plans
FRIGORIFICO INDUSTRIAL: Enters Bankruptcy on Court Orders

IMAGEN POSTAL: Receiver Oversees Bankruptcy Proceedings
MOLDES 1716: Court Assigns Receiver for Reorganization
PRODUCCIONES GRAFICAS: Files "Concurso Preventivo" Motion
RECICLADOS ECOLOGICOS: Leaves Bankruptcy, to Reorganize Instead
TELECOM ARGENTINA: Nortel Shareholders To Make Cap Contribution


B R A Z I L

CEMIG: To Be Split Into Three Due To New Power Sector Rules
EL PASO CORPORATION: Announces Long-Range Plan
TCP: Extends Conversion Period to Its Preferred Shareholders
TELEMAR: Board Authorizes Payment of Interest on Capital
TELEMAR: Board Authorizes Accrual of IOC

* IMF OK's $6.6B Augmentation of Brazil's Stand-By Loan


C H I L E

AES GENER: Gets Necessary Consents To Proceed With Bond Buyback


M E X I C O

AXTEL: To Invest Part of Funds Raised From Recent Debt Issue
DESC: Begins Administrative Restructuring


N I C A R A G U A

ENITEL: Govt. To Hold Second Round of Bidding Today


P A R A G U A Y

* IMF Approves $73M Stand-By Arrangement for Paraguay

     -  -  -  -  -  -  -  -

=================
A R G E N T I N A
=================

ACINDAR: Majority of Creditors Approve APE
------------------------------------------
Argentine steel company Acindar Industria Argentina de Aceros SA
announced Monday it has received approval from two thirds of
creditors for its offer to restructure some US$230 million in
debt.

In a filing to the Buenos Aires stock exchange, the company
stated that creditors representing over 66% of its debt approved
an out-of-court agreement, or APE. The APE will be submitted for
court approval.

An APE is an extrajudicial accord on a debt restructuring that
needs two-thirds creditor approval to proceed. Once the APE has
legal approval, it applies to all creditors.

The proposed debt restructuring contemplates the repayment of the
debt within 9 years. Acindar will maintain the original amount of
the indebtedness and will pay a 4% interest rate in 2004, Libor +
2% in 2005, Libor + 2.5% in 2006 and Libor + 3% from 2007 to
2012.

In the report issued Monday, the Company said that under the
terms of the agreement it will make an advanced payment if its
cash position permits it to do so.

Creditors will have the chance to choose between four
alternatives for the settlement of their credits:

- Dollar-denominated notes ruled by foreign legislation;

- Participation in a restructured syndicated loan contract
denominated in US dollars, also ruled by foreign laws;

- Restructured non-syndicated loan contract, denominated in
Argentine pesos and governed by Argentine legislation;

- Restructured non-syndicated loan contract, denominated in US
dollars and governed by foreign laws.


ADDAR: Court Declares Company Bankrupt
--------------------------------------
Buenos Aires Court No. 7 declared local company Addar S.A.
"Quiebra", placing the Company under bankruptcy protection. Clerk
No. 13 assists the court on the case, which will close with the
liquidation of the Company's assets to reimburse creditors.

The court-appointed receiver, Mr. Manuel Cibeira, will validate
claims and prepare the individual and general reports. Infobae,
however, did not indicate whether the court has set the schedule
for the bankruptcy process.

CONTACT:  Addar S.A.
          Blanco Enaclada 2377
          Buenos Aires

          Manuel Cibeira
          Ave Cordoba 1247
          Buenos Aires


AGEA: Debt Offer Gets Much-Needed Backing From Creditors
--------------------------------------------------------
Argentine media group Arte Grafico Editorial Argentino SA (AGEA)
revealed in a filing to the Buenos Aires stock exchange that it
received strong backing from creditors for its offer to
restructure some US$400 million in debt.

Citing Friday's filing, Dow Jones reports that the Company
obtained the backing of creditors holding 87.3% of its financial
debt and 74% of its US$250 million bond issue, which is currently
in default.

At the same time, the group's subsidiary Artes Graficas
Rioplateneses SA received the backing of creditors representing
74% of its debts of some US$50 million, adds Dow Jones.

The group needs creditor participation representing just 66% of
each type of debt in order to get the formal approval of an
Argentine judge. The subscription period for the debt offer runs
from Dec. 3 to Dec. 16.

Creditors have three options to choose from:

One option is a par bond, whose maturity would be extended for 10
years. Those who opted for this before Dec. 11 will get an
additional 2% on the nominal value of the bond.

A second option is a debt repurchase. The group demanded a 68%
nominal haircut on those who signed up for this by Dec. 11 and a
72% haircut on those who did so thereafter.

Option three is to give creditors US$520 in new seven-year bonds
for every US$1,000 offered for restructuring. In addition,
creditors will get US$120 in cash. If the creditor agreed to
participate after Dec. 11, they will receive US$480 in bonds and
US$80 in cash.

The Company says it will not settle unpaid interest.

AGEA's creditors include the local unit of Fleet Boston Financial
Corp SA (FBF), the Argentine unit of Citigroup Inc. (C), BBVA
Banco Frances SA (BFR.BA), local bank Banco de Galicia y Buenos
Aires SA (GAL.BA) and the Export-Import Bank of the United States
of America.

AGEA holds leading Argentine daily Clarin and cable channel
Multicanal SA.


AMEXA: Enters Bankruptcy on Court Orders
----------------------------------------
Amexa S.A., based in Buenos Aires, entered bankruptcy on orders
from the city's Court No. 23. A report by local news portal
Infobae relates that the city's Clerk No. 45 assists the court on
the case.

The court assigned Mr. Salomon S. Wilhelm as the Company's
receiver with instructions to verify creditors' claims until
December 30 this year. The receiver is also required to prepare
the individual reports, due on March 11 next year; and the
general report due on April 27.

The Company's assets will then be liquidated to reimburse
creditors. Payments will be based on the results of the
verification process.

CONTACT:  Salomon S. Wilhelm
          Lavalle 1290
          Buenos Aires


BROOKER: Receiver Verifies Claims in Bankruptcy
-----------------------------------------------
Ms. Susana Manrique, receiver for Brooker S.A., is verifying
creditors' claims for the Company's bankruptcy process. Argentine
news source Infobae reported that the verification period ends on
February 26 next year.

Buenos Aires Court No. 5 issued the bankruptcy order earlier this
year, and assigned the receiver. Clerk No. 9 assists the court on
the case.

The court ordered the receiver to hand in the individual reports
on April 14, 2004. These are to be prepared after the credit
verification process is completed. After these reports are
processed at court, the receiver will prepare a general report
consolidating the information in the individual reports. The
court requires the receiver to submit the general report on May
27 next year.

CONTACT:  Susana Manrique
          Lavalle 1675
          Buenos Aires


CAMMESA: To Use A Portion of Salex Funds to Settle $350M in Debt
----------------------------------------------------------------
Compania Administradora del Mercado Mayorista El‚ctrico (Cammesa)
will use part of the Salex funds -- to be used for financing
electrical infrastructure between the places of Comahue and Cuyo
-- to pay US$350 million in debt owed to various hydroelectrical
entities, among them the Entidad Binacional Yacyreta (EBY).
Cammesa is in charge of administrating the Major Electrical
Market.


CLINICA CRUZ AZUL: Court Approves Reorganization Petition
---------------------------------------------------------
Clinica Cruz Azul S.A., based in Salta, will undergo
reorganization after Court No. 2 of the province's Civil and
Commercial Tribunal approved its motion for "Concurso
Preventivo".

Infobae related that the receiver assigned to the case is Mr.
Gustavo Daniel Segura. The source did not mention the deadline
for the claims validation period. The individual reports on the
results of the verification process are due for filing on
December 26 this year.

The receiver is also required to prepare a general report after
the individual reports are processed at court. Infobae did not
indicate whether the court has set the filing deadline for this
report.

CONTACT:  Clinica Cruz Azul S.A.
          Alberdi 359
          Salta

          Gustavo Daniel Segura
          20 de Febrero 1245
          Salta


DENT SUR: Receiver Verifies Claims in Bankruptcy
------------------------------------------------
Creditors of Buenos Aires' Dent Sur S.A. must have their claims
authenticated by the Company's receiver before April 6 next year.
The receiver, Ms. Sara Maria Rey de Lavolpe, will prepare the
individual reports afterwards.

Argentine news source Infobae indicates that the city's Court No.
8 issued the bankruptcy order. Clerk No. 15 works with the court
on the case. Infobae, however, did not mention whether the court
has set the schedule for the bankruptcy process.

CONTACT:  Dent Sur S.A.
          Hidalgo 857
          Buenos Aires

          Sara Maria Rey de Lavolpe
          Cerrito 1136
          Buenos Aires


EASA: $200M of Bonds Get Default Ratings From Fitch
---------------------------------------------------
A total of US$200 million worth of Electricidad Argentina S.A.
corporate bonds were rated `D(arg)' by Fitch Argentina
Calificadora de Riesgo S.A. on Thursday.

The default ratings applies to bonds called "obligaciones
negociables", relates the country's securities regulator, the
Comision Nacional de Valores. The bonds were classified under
"Simple issue".

Fitch said that the given rating is assigned to financial
commitments that are currently in default. The rating assigned as
based on the Company's finances as of the end of September this
year.


EDEMSA: Argentine Fitch Rates $150M of Bonds `D(arg)'
-----------------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. rated bonds issued by
Empresa Distribuidora de Electricidad de Mendoza S.A. `D(arg)' on
Thursday. The rating was based on the Company's finances as of
the end of September this year.

The affected bonds were described as "Programa de emisi¢n de
Obligaciones Negociables simples". Argentina's securities
regulator, the Comision Nacional de Valores relates that the
bonds, worth a total of US$150M, will mature on April 13, 2005.

Fitch said that the given rating is assigned to bonds that are
currently in default.


EDENOR: Argentine Fitch Issues Default Ratings on $600M of Bonds
----------------------------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. assigned Thursday
default ratings to corporate bonds issued by Edenor S.A.,
according to the Commision Nacional de Valores, Argentina's
securities regulator. The `D(arg)' rating, based on the Company's
finances as of the end of September this year, is assigned to
financial commitments that are currently in default, the ratings
agency said.

The affected bonds are described as "obligaciones negociables",
with undisclosed maturity date. The bonds, worth a total of
US$600 million, are classified under "Program", the CNV adds.


EDESUR: $450M of Bonds Get `B(arg)+' from Local Fitch
-----------------------------------------------------
A total of US$450 million worth of corporate bonds issued by
Argentine utility Edesur S.A. received `B(arg)+' ratings from
Fitch Argentina Calificadora de Riesgo S.A. on Thursday.

The Comision Nacional de Valores indicated that the rating
affects bonds called "Programa de Obligaciones Negociables". The
bonds, with undisclosed maturity date, are classified under
"Program".

Fitch said that the rating denotes a significantly weak credit
risk relative to other issuers in Argentina. Financial
commitments are currently being met but a limited margin of
safety remains and capacity for continued timely payments is
contingent upon a sustained, favorable business and economic
environment.


EDITORIAL AGEDIT: Court Orders Bankruptcy
-----------------------------------------
Buenos Aires Court No. 2 declared local company Editorial Agedit
S.A. bankrupt. Working with Clerk No. 4, the court assigned Mr.
Raul Horacio Trejo as receiver for the bankruptcy proceedings.

Infobae reported creditors are given until February 13, 2004, to
have their claims authenticated by the receiver. Verifications
are done to determine the nature and amount of the Company's
debts, as well as to set a measure for the distribution of
payments after the Company's assets are liquidated.

The individual reports are due at the court on April 9, followed
by the general report on May 21. The individual reports contain
the results of the verification process, while the general report
is a summary of the individual reports.

CONTACT:  Raul Horacio Trejo
          Montevideo 205
          Buenos Aires


FAINGOLD CAVALLERA: Seeks Court's OK on Reorganization Plans
------------------------------------------------------------
Argentina's Faingold Cavallera S.R.L. sought court permission to
undergo reorganization. The Company has filed a motion for
"Concurso Preventivo" at Buenos Aires Court No. 21, related
Infobae. Clerk No. 42 works with the court on the case.

CONTACT:  Faingold Cavallera S.R.L.
          Avenida Cordoba 836
          Buenos Aires


FRIGORIFICO INDUSTRIAL: Enters Bankruptcy on Court Orders
---------------------------------------------------------
Court No. 9 of the Civil and Commercial Tribunal of Mar del Plata
in Argentina ordered the bankruptcy of local company Frigorifico
Industrial Marplatense S.A., reported Infobae. Ms. Angelica
Beatriz Ercoreca will oversee the bankruptcy process as the
court-appointed receiver.

The credit verification period will end on February 12 next year.
Creditors must have their claims authenticated by the receiver
before the said date in order to qualify for payments to be made
after the Company's assets are liquidated at the end of the
process.

The receiver's duties cover the preparation of the individual and
general reports on the case. However, the source did not mention
whether the court has set the reports' deadlines for submission.

CONTACT:  Frigorifico Industrial Marplatense S.A.
          25 de Mayo 2837
          Mar del Plata

          Angelica Beatiz Ercoreca
          Corrientes 1847
          Mar del Plata


IMAGEN POSTAL: Receiver Oversees Bankruptcy Proceedings
-------------------------------------------------------
Silvia Beatriz Cusel will oversee the bankruptcy process of
Argentine company Imagen Postal S.R.L., according to local news
portal Infobae. She is verifying creditors' claims until February
13 next year and will prepare the requisite reports.

Buenos Aires Court No. 14, which handles the Company's case,
requires the receiver to file the individual reports on March 24,
2004. These reports contain the results of the verification
process. The general report, due at court on May 10, is prepared
after the individual reports are processed at court.

The Company's assets will be liquidated at the end of the
process. Proceeds will be used to repay creditors based on the
results of the verification process.

CONTACT:  Silvia Beatriz Cusel
          Manuel Trelles 2350
          Buenos Aires


MOLDES 1716: Court Assigns Receiver for Reorganization
------------------------------------------------------
Buenos Aires Court No. 6 assigned local accountant Juan Vilanova
as receiver for the reorganization of Moldes 1716 S.R.L., related
Argentine news portal Infobae. Clerk No. 11 aids the court on the
case, the source adds.

Creditors must file their claims before April 6, 2004. The
receiver will examine and authenticate claims to determine the
nature and amount of the Company's debts. The receiver is also
required to prepare the individual and general reports on the
case, but the source did not mention whether the court has set
the filing deadlines for these reports.

CONTACT:  Moldes 1716 S.R.L.
          Moldes 1716
          Buenos Aires

          Juan Vilanova
          Hipolito Yrigoyen 1349
          Buenos Aires


PRODUCCIONES GRAFICAS: Files "Concurso Preventivo" Motion
---------------------------------------------------------
Producciones Graficas Condor S.A., based in Buenos Aires, filed
its motion for "Concurso Preventivo" at the city's Court No. 24,
according to Argentine news portal Infobae. The Company will
undergo reorganization if the court approves the petition. Clerk
No. 48 assists the court on the case, Infobae adds. However, it
did not mention whether the court is likely to approve the motion
or not.

CONTACT:  Producciones Graficas Condor S.A.
          Condor 2752
          Buenos Aires


RECICLADOS ECOLOGICOS: Leaves Bankruptcy, to Reorganize Instead
---------------------------------------------------------------
Reciclados Ecologicos S.R.L., which was undergoing the bankruptcy
process, will now reorganize, reported Argentine news source
Infobae. Buenos Aires Court No. 5 handles the Company's case with
assistance from Clerk No. 10.

The credit verification process will close on February 24 next
year. Creditors must present their proofs of claims to the
receiver, Mr. Norberto Jose Perrone, for verification before the
said date.

The individual reports on the results of the verifications are
due at the court on April 7, 2004, followed by the general report
on May 21. The receiver will prepare the general report after the
individual reports are processed at court.

The informative assembly will be held on November 17 next year,
as ordered by the court. This signals the conclusion of the
reorganization process.

CONTACT:  Reciclados Ecologicos S.R.L.
          Parana 26
          Buenos Aires

          Norberto Jose Perrone
          Constitucion 2894
          Buenos Aires


TELECOM ARGENTINA: Nortel Shareholders To Make Cap Contribution
---------------------------------------------------------------
Pedro Insussarry, Market Relations officer at Telecom Argentina
STET-France Telecom S.A., sent a letter to the Buenos Aires Stock
Exchange to provide the bourse information about the article 3ø
of Chapter XXI of the Rules. Below are the contents of the letter
dated December 12, 2003:

I am writing you as Responsible for Market Relations of Telecom
Argentina STET-France Telecom S.A. ("the Company") to inform you
that yesterday "the Company" was notified by the Secretariat of
Communications that it has issued Resolution Nø 111 dated
December 10, 2003 pursuant to which it has authorized:

1. the shareholders of the Company's holding company Nortel
Inversora S.A. ("Nortel") to make a capital contribution with all
of their ordinary Class A and B shares of Nortel to Sofora
Telecomunicaciones S.A. ("Sofora");

2. France Cables et Radio y Atlas Belgium Services S.A. to
transfer its ownership interest in 48% of the total share capital
of Sofora to W de Argentina - Inversiones S.L.;

3. Telecom Italia Group to be the exclusive operator of Telecom
Argentina STET-France Telecom S.A, and

4. Telecom Argentina STET-France Telecom S.A to change its name
to Telecom Argentina S.A.

The authorization of the Commission for the Defense of
Competition (Comision Nacional de Defensa de la Competencia) is
still pending.

CONTACT:  TELECOM ARGENTINA STET - FRANCE TELECOM SA(TELECOM)
          Alicia Moreau de Justo 50, 10th Floor
          Capital Federal (1107) Repoblica Argentina
          Phone: +54 11 4968 4000
          Home Page: http://www.telecom.com.ar

          CONTACTS:
          Pedro Insussarry, Investor Relations Manager
          Alberto J. Ricciardi, Chief Financial Officer
          Elvira Lazzati, Finance Director
          Phone: (5411) 4968-3626/3627
          Fax: (5411) 4313-5842/3109
          Email: inversores@intersrv.telecom.com.ar



===========
B R A Z I L
===========

CEMIG: To Be Split Into Three Due To New Power Sector Rules
-----------------------------------------------------------
In order to comply with the new power sector rules in Brazil,
Minas Gerais state-controlled power company Cemig (NYSE: CIG)
will have to be split into three different companies.

According to local newspaper Valor Economico, Cemig will be split
into a generation, a transmission and a distribution company. The
Company is looking to speed up the split to be able to sell
energy from new generation projects it is completing, said CFO
Flavio Decat.

However, Cemig will negotiate with the government over
compensation for the expected BRL20-million (US$6.8 million)
increase in tax expenses as a result of the split.

CONTACT:  COMPANHIA ENERGETICA DE MINAS GERAIS
          Luiz Fernando Rolla, Investor Relations
          Phone:  + 011-5531-299-3930
          Fax: + 011-5531-299-3933
          E-mail: lrolla@cemig.com.br


EL PASO CORPORATION: Announces Long-Range Plan
----------------------------------------------
El Paso Corporation (NYSE: EP) announced Monday a long-range plan
that defines the company's future businesses, targets significant
debt reduction, establishes specific financial goals, and closely
aligns compensation with shareholder interests.

"The plan is the roadmap for the future of El Paso," said Doug
Foshee, president and chief executive officer of El Paso
Corporation. "It provides the details of how El Paso will reduce
debt to $15 billion by the end of 2005, identifies the long-term
businesses of the company, details a corporate reorganization
that will result in significant cost savings, and establishes a
new strategic direction for El Paso's exploration and production
business. The plan is clear, achievable, and is the first step to
making El Paso a strong natural gas provider that generates long-
term value for our shareholders. It establishes specific
performance objectives and clear milestones so that our
shareholders can measure our progress."

                         PLAN HIGHLIGHTS

*  El Paso's core businesses will be natural gas pipelines in the
United States and Mexico, oil and natural gas production
operations in the United States and Brazil, and a marketing and
physical trading group focused primarily on El Paso's natural gas
and oil production.

*  The company will streamline its operations into a new
corporate structure organized around regulated and unregulated
businesses.

*  The regulated businesses will consist of the company's three
pipeline divisions-Southern Pipelines, Western Pipelines, and
Eastern Pipelines (which includes joint ventures and operations
in Mexico).

*  The unregulated businesses will consist of production and
processing; the company's Brazilian integrated business; Asian
power operations; domestic, European, and Central American power
operations; marketing and trading; the company's ownership in
GulfTerra Energy Partners, L.P. (NYSE: GTM); El Paso Global
Networks, the company's telecom business; and discontinued
operations.

*  GulfTerra and Enterprise Products Partners, L.P. (NYSE: EPD)
announced Monday their plan to merge and become the industry's
leading midstream company.  As a part of this transaction, El
Paso will sell a 50-percent interest in the general partner of
GulfTerra, approximately 14 million GulfTerra common units, and
certain processing assets, and will realize approximately $1
billion of cash that will accelerate El Paso's debt restructuring
program.  The company will retain a significant ownership in a
new midstream company with unequaled opportunities.  Investors
should read the press release on this transaction for more
details.

*  The long-range plan is designed to reduce the company's total
debt (net of cash) to approximately $15 billion at year-end 2005
from approximately $22 billion at September 30, 2003.  This will
be achieved primarily through $3.3 billion to $3.9 billion of
additional asset sales, the sale of restructured power contracts,
the recovery of $500 million to $600 million in working capital,
the conversion of the company's 9.00% equity security units ($575
million), free cash flow generation, and actions already taken in
the fourth quarter of 2003.

*  The company expects that the majority of its plan will be
complete by year-end 2005.  El Paso's financial targets for 2006
include:

  --  $500 million to $725 million of net income, or earnings
      per share of $0.75 to $1.10;
  --  Cash flow from operations of $1.9 billion to $2.2 billion;
  --  Free cash flow after capital expenditures and dividends of
      $200 million to $400 million;
  --  Annual growth and maintenance capital of $1.6 billion to
      $1.7 billion; and
  --  $150 million in cost reductions in addition to the $445
      million already identified.

*  El Paso expects to maintain significant liquidity through
2005, based upon operating cash flow generation, $2.1 billion of
available cash and lines of credit on November 30, 2003 and the
completion of planned asset sales.

*  The company identified potential sources of earnings
volatility over the next several years.  These include the impact
of natural gas prices, discount rates utilized in its trading and
restructured power contract portfolios, movement of the Euro
relative to the dollar, the impact of commodity prices on its
trading portfolio and possible changes in natural gas and liquids
reserve estimates, which could cause ceiling test charges.  In
addition, the company identified areas where its restructuring
activities may have an impact on earnings. These include
severance and restructuring costs, asset impairments, and gains
and losses on asset sales.

BUSINESS UNIT OBJECTIVES

Pipelines

El Paso's Pipeline Group comprises the largest and most
geographically balanced set of natural gas pipelines in North
America and is poised to benefit from the regional supply and
demand growth that is anticipated over the next several years. El
Paso expects this segment to generate stable earnings and cash
flow with average earnings growth of 2 to 5 percent annually.

The Pipeline Group's annual capital budget will be approximately
$800 million to $900 million over the next five years. Key
business drivers will include major pipeline expansions, cost
control, and continued success in capacity recontracting efforts.

Exploration & Production

El Paso will change the focus of its exploration and production
business from production growth to managing for returns on
invested capital. The company will focus its future operations on
several growth areas: the deep shelf of the Gulf of Mexico, coal
bed methane development, onshore Texas (primarily Vicksburg and
Wilcox trends), and central operations (north Louisiana and east
Texas). Capital expenditures will be approximately $850 million
per year; however the company expects to achieve incremental
benefits from third-party capital as it brings in partners on a
promoted basis. The combined capital is expected to generate a
production rate of approximately 1 billion cubic feet equivalent
per day in 2006. The company plans to divest its international
holdings in Canada (other than Nova Scotia), Hungary, and
Indonesia.

The following table shows natural gas production volumes that El
Paso Production has hedged for 2004 through 2006:

                          2004            2005          2006
Volume (TBtu)               75             130            84
Price ($/MMBtu)          $2.55           $3.22         $3.28
Expected Production
   (TBtu)            288 to 311      304 to 326    333 to 356

Marketing, Trading, and Global Power

El Paso plans to liquidate the majority of its existing trading
positions by the end of 2004 with the goal of maximizing return
of cash. The long-range plan includes a marketing and physical
trading group that will continue to manage the marketing of El
Paso Production Company's natural gas production and certain of
its existing contractual positions as part of the company's
going-forward operations.

El Paso expects to sell the majority of its domestic power
business by mid 2004. Over the next three to five years, the
company intends to operate its international power assets to
maximize cash flow and value.

Compensation and Governance

El Paso's new performance management system will be designed to
link compensation with metrics tied directly to shareholder value
created by the business units, as well as total shareholder
return relative to its peer companies.

With 10 of 12 independent directors on its board, separate
chairman and CEO positions, no staggered board and no poison
pill, El Paso continues to demonstrate its commitment to strong
corporate governance. In addition, the company has added five new
directors in 2003, all of whom have extensive backgrounds in the
production business.

"We are creating a 'fit-for-purpose' organization designed to
provide natural gas in a safe, efficient, dependable manner,"
said Foshee. "We have a great group of employees and directors,
and I'm confident we can deliver on the commitments in the plan."


TCP: Extends Conversion Period to Its Preferred Shareholders
------------------------------------------------------------
Telesp Celular Participacoes S.A. -- "TCP" (NYSE:TCP) (BOVESPA:
TSPP3 (Common), TSPP4 (Preferred)), the largest company of the
group of companies that comprise the joint venture wholly owned
by Portugal Telecom and Telefonica Moviles, which operates under
the brand VIVO, announced on Dec. 11, 2003, that it extended
until 2:00 p.m., New York time, on Jan. 6, 2004 its offer to
convert preferred shares, no par value, for common shares, no par
value, of TCP at a ratio of one-to-one, up to a limit of
78,752,717,772 in the aggregate for all shareholders.

Holders of American Depositary Shares ("ADSs") of TCP may
participate in the offer to convert if they first withdraw the
preferred shares underlying those ADSs from TCP's ADS program and
pay the applicable fees of the depositary and any taxes and
governmental charges.

Questions about withdrawing preferred shares underlying ADSs in
order to participate in the offer may be directed to:

       The Bank of New York
       101 Barclay Street
       New York, NY 10286
       Telephone: 1-888-BNY-ADRS

CONTACT: Telesp Celular Participacoes S.A.
         Fernando Abella Garcia
         Av. Roque Petroni Jr.
         1464, Sao Paulo, SP
         Brazil 04707-000
         Telephone: 55-11-5105-1182


TELEMAR: Board Authorizes Payment of Interest on Capital
--------------------------------------------------------
The Board of Directors of Tele Norte Leste authorized the payment
of BRL458.1 million as Interest on Capital ("IOC"), to be
distributed along with the mandatory dividends to be declared for
2003, to be credited to the positions held on December 30, 2003.
Such payments shall be proposed and determined until April 30,
2004, according to the terms described below:

1. Amounts Payable: To holders of common shares (TNLP3),
preferred shares (TNLP4) and Depositary Receipts (TNE) on
December 30, 2003, the amount of BRL1.20 per thousand shares
(BRL1.20 per ADR) will be paid as IOC, which represents BRL1.02
net of withholding taxes;

2. Remuneration: the principal amount of IOC determined above
shall bear interest based on the Taxa Referencial (TR) for the
period from January 01, 2004 until the initial payment date.

3. Payment: The payment dates will be determined by the Company
and proposed for approval until April 30, 2004;

4. Taxes: The principal amount of the IOC (item 1) and the
accrued interest (item 2) will be subject to witholding tax, as
determined by Brazilian law. Tax-exempt shareholders or legal
representatives should prove such condition by presenting the
appropriate documents at Banco do Brasil branches until December
26, 2003;

5. "Ex-Date": The shares will start trading "ex-IOC" in Brazil as
of January 02, 2004.


TELEMAR: Board Authorizes Accrual of IOC
----------------------------------------
Telemar Norte Leste S/A (Bovespa: TMAR3, TMAR 5 and TMAR6)
announce that the Company's Board of Directors authorized the
accrual of Interest on Capital (IOC) in the amount of BRL336.8
million to be credited to Company's shareholders based upon their
holdings as of December 30, 2003.

The Company will propose the following payment details for
approval until April 30, 2004:

1. Amounts to be credited: Holders on December 30, 2003 of Common
Shares (TMAR3) will be allocated IOC in the gross amount, of
BRL1.329 per thousand shares, which amounts to BRL1.130 net of
withholding tax. Holders of Class "A" Preferred Shares (TMAR5)
will be allocated IOC in the gross amount of BRL1.463 per
thousand shares, which amounts to BRL1.244 net of withholding tax
(per thousand shares). Holders of Class "B" Preferred Shares
(TMAR6) will be allocated IOC in the gross amount of BRL0.860 per
thousand shares, which amounts to BRL0.731 net of withholding tax
(per thousand shares), pursuant to item "4" below. Any additional
amounts paid as IOC or dividends will be communicated and
credited in due time, according to the rights attached to each
type and class of shares in the Company By-laws;

2. Remuneration of allocated IOC: The amounts above will bear
interest from January 1, 2004 through the initial date of
payment, at the TR rate ("Taxa Referencial);

3. Payment: Payment dates will be those established by the
Company, as reviewed for approval until April 30, 2004;

4. Taxation: The amounts in "1" and "2" above are subject to IRRF
(withholding tax). Tax-exempt shareholders must file due
documentation at Banco do Brasil until December 26, 2003;

5. Trading Date "ex-IOC": Shares will be traded "ex-Interest on
Capital" as of January 2, 2004, based on their equity position as
of December 30, 2003.

6. IOC previously declared: the amount now declared complement
the amounts declared in previous notices, in accordance with the
amount of up to BRL870 million approved by the Board of Directors
on September 25, 2003. Holders of Company's shares as of
September 30, 2003, October 28, 2003 and November 28, 2003, were
allocated IOC in the total amounts of BRL150.4 million, BRL300.9
million, and BRL80 million, respectively, as announced in the
company's Notices to Shareholders of September 25, 2003, October
23, 2003 and November 26, 2003.


* IMF OK's $6.6B Augmentation of Brazil's Stand-By Loan
-------------------------------------------------------
The Executive Board of the International Monetary Fund (IMF) has
approved an extension for 15 months and an augmentation by SDR
4.5 billion (about US$6.6 billion) of Brazil's stand-by credit,
originally approved on September 6, 2002 (see Press Release No.
02/40). The Board also approved the authorities' request for a
shift of repurchases expectations in the credit tranches of an
amount SDR 4 billion (about US$5.8 billion) into an obligations
basis in each 2005 and 2006.

The Board's decision was taken simultaneously with the completion
of the fifth and last scheduled review of the original program,
which made SDR 5.6 billion (about US$8.2 billion) immediately
available to Brazil. However, in light of improvements in
Brazil's balance of payments, the authorities have indicated that
they do not intend to make further drawings.

Following the Executive Board's discussion of Brazil on December
12, 2003, Horst K”hler, Managing Director and Chairman of the
Board, stated:

"Brazil's performance under the Stand-By Arrangement approved on
September 6, 2002 remains exemplary. All performance criteria and
structural benchmarks associated with the fifth review were met.

"Supported by the commitment of significant Fund resources,
Brazil has come a long way since last year's financial market
volatility. The response of the new administration to financial
pressures has been both ambitious and courageous, balancing
fiscal and monetary policy discipline with the resolute pursuit
of key social goals to relieve poverty and strengthen the social
safety net. To allay concerns over debt sustainability, the
government increased the primary surplus target. The central bank
responded proactively to guide inflation back to the government's
targets. Moreover, early in its tenure, the administration took
the difficult political step of seeking approval of key
structural measures-including pension and tax reform-that will
deepen the foundations for sustainable and equitable growth of
output and employment.

"The successful implementation of these policies has resulted in
a rapid restoration of confidence, which is being clearly
reflected in the performance of financial market variables.
Improved market sentiment, in part reflected in those variables,
is driving an emerging recovery of economic activity, and demand
growth should continue to accelerate in the coming year. Ensuring
that all members of Brazilian society participate in the
country's vast potential will be the government's key challenge
for the coming years.

"To support the government's efforts to put Brazil firmly on a
path to sustained growth with improved equity, the Fund's
Executive Board has approved an extension and augmentation of the
Stand-By Arrangement. The Fund regards this step as an important
component of the government's strategy for a smooth exit from
Fund financial support. The Fund will also assist Brazil in
smoothing its schedule of external commitments by shifting some
Fund repurchases from an expectations to an obligations basis in
2005 and 2006. The authorities' stated intention to treat the
arrangement as precautionary, given the absence of a balance of
payments need, is welcome.

"Prudent monetary and fiscal policies will remain at the core of
the Fund arrangement. At the same time, the program also provides
support for essential spending to help achieve the government's
social objectives. The maintenance of a strong primary fiscal
position, along with continued further improvements in Brazil's
debt structure, will be key to ensuring medium-term
sustainability and promoting favorable investment decisions. The
program also features important structural measures that will
both support and sustain dynamic growth in Brazil in which the
private sector will continue to play the major role. These
include steps to reduce banking spreads, increase financial
intermediation, and improve the business environment, while also
undertaking the preparatory work towards increasing the
flexibility of the budget. These policies will help nurture the
recovery now underway in Brazil and sustain investment and
economic growth into the medium term," Mr. K”hler stated.

ANNEX

Recent Economic Developments

Brazil's monetary and fiscal policies have remained disciplined,
actual and expected inflation have declined steadily, and market
forecasts put end-2004 inflation solidly within the official
target range. In addition, the external adjustment remains
impressive, with record trade surpluses and the current account
moving into surplus.

Both the public and private sectors have regained access to
international capital markets, and country risk has dropped to
levels not seen since 1998. The real has appreciated by 30
percent in nominal terms from its weakest point during the
crisis, and, in real terms, is now close to its January 2002
level. Important progress has also been made in moving forward
the government's structural reform agenda, and this has been a
key driver of market sentiment.

This strong performance has laid the foundation for a resumption
of growth. Following disappointing performance earlier this year,
there are now clear signs that domestic demand has begun to
recover. Due to the slow start this year, output is unlikely to
rise by more than 0.6 percent, but growth is forecasted at 3.5
percent in 2004, with consumption and investment both rising
solidly.

Program summary

Despite the recent successes, Brazil remains vulnerable to
negative shifts in market sentiment. The authorities have
therefore committed to a policy program for 2004 that will
continue making progress in addressing core vulnerabilities, such
as the large external borrowing requirement, and relatively low
net reserves, currently at about US$17 billion. The extension for
15 months of the current Stand-By credit, and the shifting of
some repayments to the Fund, are also part of the authorities'
strategy to reduce vulnerabilities and to exit from Fund
assistance.

The program calls for a continued healthy public sector primary
surplus in 2004. The budget for 2004 is consistent with a primary
surplus target of 4.25 percent of GDP.

The authorities plan to continue to build on recent progress in
improving the composition of the domestic debt, further reducing
another important vulnerability. Details of their public debt
management plan for 2004 are still being finalized, and will be
published in January. The authorities' overall goals will be
identical to those in 2003: to further reduce the share of debt
that is indexed to the exchange rate or is at floating rates,
while increasing the share of fixed rate and inflation-linked
debt.

The central bank's proactive conduct of monetary policy has
ensured the credibility of the inflation targeting regime over
the past year. As a result, the central bank has been able to
ease policy steadily over the last several months as inflation
expectations have continued converging to the government's
targets.

The authorities' structural reform agenda for 2004 is another
element in the effort to address vulnerabilities and stimulate
growth. Key priorities include increasing financial
intermediation, reducing bank lending spreads, and improving the
business environment. In addition, the authorities will work to
implement the tax and pension reforms currently before congress.

Significant reforms are also under way to reduce bureaucratic
barriers to international trade.

Enhancements to the regulatory framework are an important element
of the authorities' strategy to improve the environment for
private investment. They include a new regulatory model for the
energy sector and the removal of tax and regulatory
inefficiencies, including the conversion of the COFINS
contribution to a value-added-type basis, to reduce the
distortions arising from its current cascading format. Following
the recent experience with streamlining export regulations, the
government will undertake a study to identify measures to
simplify, integrate, and reduce registration requirements for
businesses.

The authorities are also continuing to introduce reforms to
improve the delivery of social services, which they see as
central to their policy platform. In addition to the creation of
the Fome Zero (Zero Hunger) program, the government has
consolidated existing social assistance under the umbrella Bolsa
Familia (Family Stipend) program. The authorities believe that
improvements in infrastructure spending in this area have the
potential for large social returns.

Brazil is an original member of the IMF; its quota is SDR 3.04
billion (about US$4.4 billion). Brazil's outstanding use of IMF
credit currently totals SDR 23.19 billion (about US$33.86
billion).

CONTACT:  INTERNATIONAL MONETARY FUND
          700 19th Street, NW
          Washington, D.C. 20431 USA

          IMF EXTERNAL RELATIONS DEPARTMENT
          Public Affairs
          Phone: 202-623-7300
          Fax: 202-623-6278

          Media Relations
          Phone: 202-623-7100
          Fax: 202-623-6772



=========
C H I L E
=========

AES GENER: Gets Necessary Consents To Proceed With Bond Buyback
---------------------------------------------------------------
AES Gener, a Chilean unit of U.S. based energy group AES Corp.,
received the necessary consents from holders of Yankee notes and
US senior convertible bonds by the December 5 deadline to make
certain amendments to the notes, reports Business News Americas.

In a statement Friday, the Company revealed creditors holding
US$140.2 million (70.1%) of the Yankee bonds and US$49.8 million
(67.34%) of the convertible bonds placed in the USA gave their
approval.

AES Gener needs the bondholders' consent so it can proceed with
its tender offers to buy back the notes. Deutsche Bank Securities
is managing the tender offers.

However, AES Gener has postponed its refinancing plan until early
2004 because bondholders of US$403 million in Chilean convertible
bonds due 2005, who also met on December 5, requested more
information.

AES Gener plans to finance its tender offers by issuing US$400
million in new bonds on international markets, increasing capital
by up to US$80 million, and receiving the repayment of a US$290-
million loan from parent AES.

CONTACT:  AES GENER S.A.
          Mariano Sanchez Fontecilla 310 Piso 3
          Santiago de Chile
          Phone: (56-2) 6868900
          Fax: (56-2) 6868991
          Home Page: www.gener.com
          Contact:
          Robert Morgan, Chief Executive
          Laurence Golborne Riveros, Chief Financial Officer



===========
M E X I C O
===========

AXTEL: To Invest Part of Funds Raised From Recent Debt Issue
------------------------------------------------------------
Axtel S.A. de C.V., a privately held Mexican competitive local
exchange carrier, plans to invest US$68 million of the US$175
million raised in last weeks' debt placement, Business News
Americas reports, citing a company source.

While it didn't reveal where the money will be invested in, the
source said that the balance will be used to pay down the
Company's debts including a loan of US$75 million from Mexican
bank Banorte, US$24 million for equipment vendor Nortel Networks
(NYSE: NT), and US$8 million to Bell Canada International.

Once those payments are made, Axtel's net debt will stabilize at
about US$100 million, the source said.

Last week, Axtel sold US$175 million of 10-year senior notes in
the 144a private placement market. The size of the deal was
increased from an originally planned US$150 million. Credit
Suisse First Boston was the sole lead manager for the sale.

Axtel provides local, long distance and data services in six
cities and has about 332,500 lines in service. Mexican investors
own 58% of the Company, with the other 42% divided between
international investors that include AIG-GE Capital Latin
American Infrastructure Fund and the Blackstone Group.


DESC: Begins Administrative Restructuring
-----------------------------------------
DESC, S.A. de C.V. (NYSE: DES; BMV: DESC) announced Monday that
Luis Tellez will resign as Executive Vice President of Desc
effective December 31, 2003.

Tellez has accepted a position at an investment fund beginning
January of 2004. Fernando Senderos, Chief Executive Officer and
Chairman of the Board of Desc, appreciates his contributions and
acknowledges his performance within the Company's Executive
Committee.

Luis Tellez will remain a member of the Board of Directors.

Fernando Senderos M. has decided that due to this resignation,
and as part of the Company's cost-reduction program, a
replacement for the position of Executive Vice President will not
be named.

Mr. Senderos will perform the duties of the Executive Vice
President and will propose eliminating the Executive Committee at
the next Shareholders' Meeting.

In the next few days, the Company will announce a new
administrative and operating structure that will allow Desc to be
a more efficient, competitive and flexible company according to
the current business environment.

Mr. Senderos stated, "These are challenging years and we are
certain that with these measures we will be able to successfully
face and achieve the Company's main objectives, which are to have
a profitable company and to give value to our shareholders. With
respect to Luis' decision, I wish him great success in his new
position, and I am certain that we will continue to work together
within Desc's Board in creating value for its shareholders."

Desc, S.A. de C.V. is one of Mexico's largest industrial groups
with sales of approximately US$ 2 billion during 2002, and over
16,000 employees. Through its subsidiaries, the Company is a
leading operator in the Autoparts, Chemical, Food and Real Estate
Sectors.

CONTACTS:  Arturo D'Acosta Ruiz
           Alejandro de la Barreda
           Phone: (5255) 5261-8037
           alejandro.delabarreda@desc.com.mx

           Melanie Carpenter
           Tel: 212-406-3693
           mcarpenter@i-advize.com



=================
N I C A R A G U A
=================

ENITEL: Govt. To Hold Second Round of Bidding Today
---------------------------------------------------
The Dec. 12 deadline for offers to buy the Nicaraguan
government's 49% stake in fixed line incumbent Enitel failed to
see a winning bid, reports Business News Americas.

In this light, the government's Enitel holding unit Uretel will
hold a second round of bidding today, Dec. 17. This time around,
the government revealed a base price of US$49.5 million for the
49% stake.

Uretel head Carlos Fernandez revealed that Mexico's America Movil
(NYSE: AMX) and Swedish-Honduran group Megatel had placed initial
bids on Dec. 12, but as part of the process, had not been
informed of the minimum price and neither bid made the mark,
prompting them to request for another round of bidding.

Megatel already owns 40% of Enitel and is also present in
Honduras, where it recently launched a mobile operation. Enitel
employees hold the remaining 11% of the company.



===============
P A R A G U A Y
===============

* IMF Approves $73M Stand-By Arrangement for Paraguay
-----------------------------------------------------
The Executive Board of the International Monetary Fund (IMF)
approved Monday a 15-month SDR 50 million (about US$73 million)
Stand-By Arrangement for Paraguay to support the country's
economic program. The approval opens the way for the immediate
release of SDR 30 million (about US$44 million). The authorities
have indicated their intention to treat the arrangement as
precautionary.

Following the Executive Board discussion, Shigemitsu Sugisaki,
Deputy Managing Director and Acting Chairman, said:

"Paraguay has launched an ambitious reform program to stabilize
the economy and begin a process of structural reform to raise
growth, reduce poverty, and improve governance. The government
has actively sought broad consensus from political parties and
civil society for the key elements of its reform program, and
this participatory approach should enhance prospects for
successful program implementation.

"The stabilization effort is anchored on an ambitious fiscal
agenda. The authorities are committed to eliminating the fiscal
deficit in 2004, undertaking lasting reform of the institutions
of the public sector, restructuring and reducing debt, and
clearing all payment arrears.

"Strengthening revenues is a critical component of the program,
and will be achieved through increasing key excise tax rates,
broadening the base of the value-added tax and the income tax,
implementing a new vehicles tax, and strengthening tax and
customs administration.

"Efforts at fiscal consolidation will include spending austerity,
redirecting spending to the social sectors and public investment,
reforming the public employees' pension plan, and containing the
losses of public enterprises through efficiency enhancement and
adequate pricing policy for fuel and utilities. Expenditure
management will benefit from the implementation of the recently
approved Public Procurement Law, and the undertaking of external
audits of public institutions.

"To ensure successful medium-term fiscal consolidation, the
authorities intend to continue working on normalizing relations
with external and domestic creditors, and to prepare reforms of
the civil service, the social security system, and public
enterprises.

"Paraguay's monetary policy will be geared to controlling
inflation and allowing a freely floating exchange rate. The
central bank will undertake institutional reforms to improve its
ability to conduct an independent monetary policy. The
authorities will also take important steps to improve the
financial system. These measures include restructuring the public
banks, strengthening the bank resolution framework, strengthening
regulation and supervision of financial entities, including
cooperatives, and requiring independent credit ratings of banks.

"With resolute implementation of the policies contemplated in the
program and sustained efforts to improve transparency and
governance, Paraguay should move into a period of greater
economic stability and more robust growth. This, in turn, will
contribute to reducing poverty and providing resources to address
the country's social challenges," Mr. Sugisaki stated.

CONTACT:  INTERNATIONAL MONETARY FUND
          700 19th Street, NW
          Washington, D.C. 20431 USA

          IMF EXTERNAL RELATIONS DEPARTMENT
          Public Affairs
          Phone: 202-623-7300
          Fax: 202-623-6278

          Media Relations
          Phone: 202-623-7100
          Fax: 202-623-6772




               ***********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter - Latin America is a daily newsletter
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Copyright 2003.  All rights reserved.  ISSN 1529-2746.

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