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Toronto-based Brazilian Resources has raised financing to acquire three operating government-owned hydro plants in Brazil, through the privatisation tender process.

The three plants have a combined capacity of 16.5MW, which Brazilian Resources plans to expand to 34MW. The company also plans to develop another 32MW site, for which it has the rights. A feasibility study for this plant is complete and final design is in progress.

Over the past year, Brazilian has raised US$1.95M of bridge financing to fund design, development and acquisition of hydroelectric assets. Legal and engineering work has been increasing the quality of the sites to a level considered to be acceptable for long term project financing.

Brazilian Resources is currently negotiating terms for up to US$2.5M of further financing with US-based investment bankers. The debt is planned to be converted into long-term project debt — US$80-90M, depending on the results of feasibility studies.

The most recent borrowings will be used to complete the land acquisition required for the 32MW site, complete legal work and complete power purchase agreements. Of the US$550,000 obtained, US$400,000 was brokered by Acadia Bay Energy, an energy development company with offices in Freeport and Boston.

•A Brazilian mining company has commissioned the US$65M Sobragi hydro power plant. It is anticipated that the plant’s cheap energy will save US$1M in monthly production costs at the company’s zinc smelter. Excess energy will be sold to Minas Geraois state.