Alcoa Aluminio, the Brazilian affiliate of Alcoa, Pittsburgh, has increased its stake in the Estreito hydropower project in Northern Brazil from 19.08% to 25.49% by purchasing a 6.40% share from BHP Billiton, which is exiting the project. Terms of the deal were not disclosed.
Estreito is Alcoa Aluminio's third power generating project in Brazil, preceded by Machadinho (capacity of 1,140 MW), which has been running since 2002, and Barra Grande (708 MW capacity), which began operating in late 2005.
The 6.40% share entitles Alcoa Aluminio to an additional 38 megawatts of hydropower, bringing a total of 149 megawatts of assured power to supply Alcoa Aluminio's Alumar aluminum smelter in Sao Luis, Brazil. Construction of the 1,087-megawatt Estreito hydropower facility is expected to begin in June 2006, following necessary government regulatory and environmental approvals. Startup of the power plant is set for 2011.
Other partners in Estreito are Suez Energy South America, CVRD and Camargo Correa Energia SA. Alcoa exerted its preemptive rights in accordance with the shareholding agreement between the consortium for the construction of the Estreito hydroelectric power plant.
As a result of the sale to Alcoa, plus the sale of a 10.07% share to Suez Energy South America, BHP Billiton has excited the project.
Alcoa Aluminio, headquartered in Sao Paulo, Brazil, produces primary aluminum, fabricated aluminum, and packaging products for a variety of internal and external customers worldwide.