Odebrecht quits Peruvian dam project

25 November 2011

Brazilian construction company Odebrecht has dropped plans to build a 1278 MW dam on the Tambo River in the Peruvian Amazon.

The project, known as Tambo-40, has been halted because of objections from the local population. Building the dam would have affected around 14000 indigenous people along the Tambo and Ene Rivers.

Odebrecht said it had informed the Peruvian Ministry of Energy & Mines of its decision to withdraw from the project after preliminary studies revealed the strong opposition of the Ashaninka indigenous population.

Tambo-40 is one of five hydroelectric projects prioritised by energy agreements between Brazil and Peru signed in 2010 that commits Peru to supplying more than 6000 MW of power to Brazil, most of which is expected to come from hydropower in the Peruvian Amazon.

The other priority projects in the region are the 2000 MW Inambari project, the 2000 MW Paquitzapango project, the 607 MW Mainique project and the 579 MW Tambo 60 project.

Controversy

Tambo-40 is not the first hydroelectric project on the Amazon to cause controversy. The Belo Monte hydroelectric dam on the Xingu River in the Brazilian Amazon, for example, has faced many hurdles since the idea was first proposed as far back as 1975.

The project has been redesigned over the years, but in June last year, a Brazilian federal court judge suspended bidding for the construction and operation of the 11200 MW project. The US$ 17 billion contract was eventually awarded to the Norte Energia consortium, which is led by state-run utility Eletrobras Chesf (49%), and the project was approved by the Brazilian government on 1 June, 2011.

However, construction of the 3.8 mile (6.1 km) wide dam was again blocked by a federal judge on 18 September. This decision was again overturned on 10 November, when another Brazilian court ruled that construction on the dam could continue without additional consultation with indigenous communities.