BB eyes US$57mn investments in hydro projects

Brazil's Banco do Brasil (BB) is contemplating financing of around 200mn reais (US$57.3mn) for 15 hydroelectric projects, BB energy division manager Eugenio Dias told BNamericas. The rough estimate represents BB's share of investments, and the overall value of the projects is much higher, Dias explained, adding that there is no timetable for closing the deals. This week, BB and partners closed a project-financing package with Queiroz Galvao Energetica for the 110MW Jauru hydroelectric plant in Mato Grosso state, the bank said in a statement. BB will contribute 30mn reais in funds from the Center West Fund (FCO) of Brazil's national development bank BNDES, and will also act as the guarantees administrator. BB works closely with BNDES, acting as the financial agent for repassing BNDES loans or loans from the FCO, he said. BB has financed a total of five large and small-scale hydroelectric projects since it moved into this area in 2000, Dias said. The bank's decision to enter the segment is for purely commercial reasons, to meet the financing demands of the sector, he explained. The bank tends to act as arranger or financier for projects, although it can also leading a consortium of banks or manage guarantees, depending on the project in question, Dias said.