Renewables company Scatec has signed a power purchase agreement (PPA) with alumina supplier Alunorte for its Mendibum solar project in Brazil.
Located in the state of Rio Grande do Norte, the independent power producer (IPP) has also started construction of the 531MW solar PV project in partnership with energy companies Equinor and Hydro Rein, placing orders for key components and preparing activities at the site.
The companies have signed a 20-year USD-denominated PPA with Alunorte for 60% of the expected production capacity of Mendibum. The remaining power would be sold on the Brazilian power market.
Capital expenditure for the project has been estimated at US$430 million and will be financed through a mix of project debt and equity from the project’s partners who expect to achieve financial close by the end of the year.
This is the second project in Brazil for the renewables company and is part of a growing pipeline in the Latin America region with more than 2GW.
The investments marks a “key milestone” in Scatec’s strategy and will strengthen its position in a renewable growing market, said Terje Pilskog, Scatec’s CEO.
The Norwegian company has also been actively building its green hydrogen and ammonia pipeline since the beginning of the year with projects in Egypt and another one in Oman that has received the first green hydrogen certification from TÜV Rheinland.