French multinational electric utility company ENGIE has acquired a 30-year greenfield concession project in Brazil through a tender process launched by Sterlite.
The project includes construction, operation and maintenance of an electric power transmission line, covering 1,800km, and a new substation, as well as the expansion of three additional substations located in northern Brazil.
The project will require an investment of €750m ($828m).
ENGIE CEO Isabelle Kocher said: “This transaction follows the acquisition in Brazil of the TAG gas transmission network, which represents 4,500km of gas pipelines or 47% of the country’s total gas infrastructure.
“We are accelerating the delivery of our strategy in Latin America where there is a strong need for new infrastructure to meet increasing energy demand”
Necessary licenses required for the construction of the project have been secured and the construction works will begin this year.
For ENGIE, this is the second transmission project in Brazil. Its first project was Gralha Azul project that the company won in December 2017 at ANEEL’s transmission auction.
The Gralha Azul project works included the construction of 1,000km of transmission lines, five new substations and the expansion of an additional five substations in the Paraná state. With an investment of €440m ($486m), the project construction is currently underway.
In another development, ENGIE signed an agreement with EDPR to create a co-controlled 50/50 joint-venture (JV) for fixed and floating offshore wind.
In May 2019, ENGIE and EDPR announced they will create a new entity that will act as an exclusive vehicle of investment for offshore wind opportunities across the world.
According to the agreement, ENGIE and EDPR will combine their offshore wind assets and project pipeline in the new business entity.
Initially, the new business entity will have a total of 1.5GW of projects under construction and 3.7GW under development.
The agreement is subject to certain conditions, including the European Commission regulatory approval. The JV is expected to start its operations by the first quarter of 2020.