Total Thermal Power Plant

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The Brazilian company Total Agroindustria Canavieira S.A. was granted an authorization to build a 40-MW thermal power plant located in the state of Minas Gerais (municipality of Bambui). The cogeneration power plant was set to use sugar cane residues as fuel. Besides the cogeneration unit, the industrial complex owned by the company also had a sugar-cane pressing facility and ethanol producing plant, which commenced operations in 2006. In July 2008, Total Agroindustria Canavieira S.A. signed a 30-year contract with the regulatory agency ANEEL allowing the company to operate in the electricity market as a independent producer. This authorization granted the sponsor with the right to sell electricity in the Brazilian wholesale market. Of the 48 MW in total capacity, 38.5 MW was to be sold in the wholesale market (half of this share had already been sold to the grid through competitive bidding). In December 2009, the ownership structure of the company changed and all shares were transferred to Turdus Participacoes S.A. In March 2010, Turdus sold 40% of its shares in the project company to the state-owned company Petrobras (the sale of the shares was done through a capital increase of BRL 150 million). In September 2008, the company was granted a US$ 58.3 million (BRL 106.7 million) syndicated loan contract from BNDES, a state-owned development bank. The resources from the loan was directed both to the construction of the ethanol producing unit and to the cogeneration facility, which comprised a total investment of US$ 109.3 million (BRL 200 million). Investment commitment solely to the cogeneration plant was not available. Construction works on this plant were concluded in 2008.