According to the MOU signed between the companies, Vale and its partners intend to develop studies to determine the attractiveness of the project, and assess the conditions for participation in the bidding process.
Brazil’s environmental regulator Ibama issued a preliminary licence for the project earlier this month, subject to conditions covering issues relating to water quality, wildlife, sanitation, resettlement, compensation and rehabilitation of degraded areas.
Granting of the preliminary licence allows the auction for construction of the project to go ahead – although the licence does include 40 conditions that must be met by future developers of the project.
The project, on the Xingu River, will help the South American country help meet soaring demand for electricity once developed, but it has been mired in controversy with environmental groups claiming the scheme will damage the ecosystem and threaten wildlife in the region.
