Odebrecht, Furnas to Construct Hydroelectric Project in Brazil

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Researched by Industrial Info Resources (Sugar Land, Texas)--The federal power company Furnas, in a consortium led by engineering firm Odebrecht, has won the auction for the construction and operation of the 3,150-megawatt (MW) San Antonio project on the Madeira River in the western Amazon region of Brazil.

The San Antonio project and the 3,300-MW Jirau project are part of the $9.8 billion 6,450-MW Madeira hydroelectric complex in Rondonia, Brazil. Both projects are the basis for the Brazil-Bolivia-Peru hub of the Initiative for the Integration of the South American Infrastructure (IIRSA) and also part of PAC, Brazil's growth-acceleration program. Odebrecht and Furnas performed the EIS for the Jirau and San Antonio projects in which it invested $25 million. For details, see related May 3, 2007, article - Brazilian Engineering Company Camargo Correa to Participate in $9.8 Billion Madeira Hydroelectric Complex.

Federal power companies will have a minority participation in the project, so if a foreign company or consortium wins the San Antonio auction, a special-purpose company must be formed. It has been agreed that construction firms can hold up to 20% in consortiums planning to bid for this project. For more details, see related August 16, 2007, article - Brazil's MME to Bid Madeira's 3,150 MW San Antonio Hydroelectric Project in October 2007.

The main companies that participated in the auction for the construction and operation of the 3,150-MW San Antonio hydroelectric project were: Camargo Correa, in partnership with Brazil's federal company Chesf (Pernambuco, Brazil); the French power group Suez (Paris, France); Furnas, in a consortium led by Odebrecht; Eletronorte, which is the responsible for the generation and transmission in the Amazon region (Distrito Federal, Brazil); the state-owned transmission company Eletrosul (Santa Catarina, Brazil); and the Brazilian engineering company Alusa (Sao Paulo, Brazil). Odrebrecht, which carried out the feasibility studies in Rio Madeira, won the bidding process with Furnas with an offer of $44.57 per megawatt-hour (MWh), 35% less than the price estipulated by the government. The $5.7 billion San Antonio hydroelectric plant, considered essential by the Brazilian government in order to help the country meet power demand, is expected to be finished by 2012.

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