ALCOA Pushes for Massive Amazonia Exploitation

ALCOA Pushes for Massive Amazonia Exploitation

Just as the World Wide Fund for Nature (WWF) releases a critical report on the impacts of huge dams, the world's largest aluminium producer pledges its support for a massive hydro scheme in the heart of Braziian Amazonia.

ALCOA's interest in the Belo Monte construction

June 15th 2004

Source: O Estado de S.Paulo

The Brazilian subsidiary of ALCOA, the world's leading aluminium producer, is interested in the construction of the largest hydroelectric complex, now under study in Brazil. Called the Belo Monte Plant, located on the Xingu River in Para State, this will have capacity of 11,182 megawatts of energy. The plant could be the definitive push for the corporation's constructing a new aluminium factory in Brazil. Among other factors, this project depends upon the guarantee of electricity.

According to the company's Latin American president, Josmar Verillo, in addition to the US$ 1.4 billion dollar investment announced for the next 4 years, the company is in discussions with the government for the construction of a new aluminium factory in Brazil, which will require resources of US$ 3.2 billion dollars.

"Our interest in Belo Monte is associated with this new factory", argues Verilio. According to him, the company was questioned by the government and showed interest in the project, which could be conducted in partnership with other big companies.

The Belo Monte project, first presented in 1975, has suffered constant environmental pressures, but is among current proposals by the government which intends to start the bidding process at the end of the year. The project is critical, due to the fact that it would be in Amazonia, where obtaining environmental licenses has been difficult. Verillo believes that this will not necessarily be an impediment because, due to the new electrical sector model, bidding will only be conducted once the environmental license has been conceded.

In the energy sector, ALCOA is already participiating in the hydroelectric plants Machadinho (1.140 MW) and Barra Grande (708 MW). The latter will enter into operation in the second semester of 2005. In addition to this the company also has participation in three other projects: Pai Querê (292 MW), Estreito (1.087 MW) and Serra do Facão (210 MW).

All three are in the process of environmental licensing. According to Verillo, the investment in this sector is US$ 50 million dollars, because our "business is aluminium and not energy." The investment intention in energy is to guarantee self-sufficiency. Today the corporation's energy consumption is supplied by Eletronorte and Machadinho.

The proposed use of Belo Monte energy for aluminium production has not been well received by critics who say that hydroelectric energy, tending to be cheaper [than other sources] should be of benefit to the population.