China’s State Power Investment Corp wins state hydro concession in Brazil

28 September 2017

China’s state power group State Power Investment Corp. will start operations at the São Simão hydroelectric plant, the largest of a set of four put up for auction by Brazil’s federal government, with an offer of 7.18 billion reais (US$2.4 billion), according to official information.

The federal government secured 12.1 billion reais from the concession auction of the four hydroelectric plants hitherto operated by Companhia Energética de Minas Gerais (Cemig), with new contracts valid for a period of 30 years.

French group Engie secured two plants – Jaguara and Miranda – paying 3.53 billion reais (US$1.1 billion) and Italian group Enel won the auction for the Volta Grande plant with an offer of 1.41 billion reais (US$440 million).

Gustavo Labanca, an Engie senior official, said the group is expected to issue debt in Brazil, specifically commercial paper, in order to pay for the new licenses.

The four hydroelectric plants have a combined production capacity of 2,922 megawatts.

Also on Wednesday, 10 Brazilian and seven foreign companies paid a total of US$1.2 billion to prospect and extract oil and natural gas in 37 of 287 blocks auctioned by the National Agency for Petroleum, Natural Gas and Biofuels.

A consortium made up of US groups ExxonMobil and Brazil’s state-owned Petrobras secured six blocks in the Campos basin, for which they paid US$425 million.

Other groups and companies that secured blocks include US company Murphy Oil Corp and the China National Offshore Oil Corporation, Australia’s Karoon and Spain’s Repsol. (macauhub)

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