Mining giant Vale shedding Belo Monte hydropower project shares

Belo Monte Hydropower Project

Brazilian power corporation Cemig Geracao e Transmissao SA has made a deal to acquire a 49% stake in the massive Belo Monte hydropower project from mining company Vale.

Vale approved a plan to buy into the 11,200 MW hydroelectric plant in May 2011, but said it is shedding the majority of its shares in this week's US$100 million deal, citing three years of slumping iron ore prices and a decreasing investment program.

Vale will retain a right to 9% of the energy produced by Belo Monte and a 4.59% share through a company subsidiary per a December 2013 accord, the company said. reported last September that steel and mining firm ArcelorMittal had committed to supplying 50,000 tons of steel for the project.

Budgeted at US$26 billion, Belo Monte is being built on the Xingu River in Brazil's northern Para State and will be the world's third largest hydroelectric complex when completed.

Belo Monte has a completion deadline of 2018, though developer Norte Energia filed a request for a construction extension this past June. A federal court rejected a request in July from from a public prosecutor to suspend work on the project because Norte Energia was accused of failing to consult properly with aboriginal groups potentially affected by Belo Monte.

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