The Suez Energy International-led joint venture developing the 1087MW hydro power project plans to lodge an appeal against the court ruling. The JV concessionaire - Consorcio Estreito Energia (Ceste) - is liaising with Brazil's electricity authority (Aneel) and environmental authority (Ibama) to lodge the appeal.
Opposition to the river diversion works has come from the Federal Public Ministry in Maranhao state, which brought the legal complaint against Ceste's development of the scheme. Ibama granted an environmental licence to the project, but the Ministry wants the entire Tocantins river basin to be assessed and not only the project-related area.
The Ministry has also asked for a suspension to the validity of the project's installation licence, without which the plant cannot operate.
Estreito is under construction on the Tocantins river, between the states of Tocantins and Maranhao, in north Brazil. The project requires construction of a 60m high by 540m long concrete dam. Last year, a JV of Impregilo and OAS won the civil works contract for the project, and the contract is scheduled to be completed in the second half of 2010.
Last year, the project was troubled by legal opposition which saw a court block the scheme on behalf of agencies arguing for provisions for indigenous people. The federal government's legal agency AGU suspended the legal block, allowing the project to proceed and contracts were awarded in the months afterward.
In April this year, the national development bank (BNDES) signed a major loan covering approximately a third of the investment cost of the Estreito project.
Estreito is the biggest major hydro power scheme in advanced construction in Brazil. However, it is much smaller than the two projects - San Antonio and Jirau - that recently saw concessions awarded, and are the two key parts of the 6450MW Madeira scheme in west Brazil, at the border with Bolivia.
