Malaga Inc. and Hidropesac, a joint venture between Malaga and its Swiss partners, Emerging Power Developers and Stucky S.A., announced that they will build a new hydroelectric power plant on Malaga's Pasto Bueno property in Peru. While initial capacity is expected to be 20 MW, given the area's watershed and water flow characteristics, as well as enhanced dam retention capacity, potential capacity could subsequently be increased up to 38 MW. The decision to build a new power source was based on Hidropesac's updated feasibility study on the construction of a hydroelectric power plant using the water resources of the Pelagatos and Plata rivers. Hidropesac has a temporary concession permit and is presently updating the environmental assessment and archeological artefacts study. When those studies are finished, it will then complete the generation and transmission technical specification, a feasibility study for the electromechanical equipment, engineering for the civil and electromechanical works, and engineering for the substations and transmission line in order to obtain the permanent concession. Malaga expects to obtain final approval early in the fourth quarter of 2012, which would allow building to begin the following quarter. Construction is expected to take 18 to 24 months, followed by a six-month commissioning period.