Venezuelan president Hugo Chavez's sudden commitment to wind power is part of a bid to to reduce the country's 70% dependency on hydropower for its electricity.
A national emergency was declared on February 8 after a drought severely affected water levels at the Guri Lake, home to Venezuela's largest dam.
The 100MW 'Paraguaná' development is located in the municipality of Taques, on Falcon's Paraguaná peninsula. Gamesa was unable to comment on the reports.
The project belongs to Gamesa's developer-client, Petróleos de Venezuela S.A (PDVSA), the country's biggest energy group, which operates an oil refinery close by.
Lugo confirmed the plant will me made up of 1.3MW wind turbines. That ties in with a contract with PDVSA Gamesa announced to Madrid's stock market regulator, CNMV, in December 2008, for 76 MADE AE61-1.3MW machines, a brand Gamesa acquired in 2002 from compatriot utility Endesa.
Gamesa had said the machines would go to the Paraguaná wind project, then envisaging installation to begin in "the last quarter of 2009". The company also confirmed the contract-including supply, installation supervision and commissioning, as well as two years operation and maintenance services-was worth "approximately €116 million".
Drought allegedly caused by the El Niño weather phenomenon has highlighted the risk of such dependency. Chavez promised specific planning to usher in large scale wind development. Meanwhile, Portuguese oil firm Galp, says it is developing four wind plants totalling 72MW across the Venezuelan islands of Chacopata, Isla de Coche, La Guajira and Isla Margarita.