December 30, 2015 / 7:32 PM / 5 years ago

Spain's Abengoa seeks to sell stalled Brazil projects

SAO PAULO, Dec 30 (Reuters) - Spain’s multinational Abengoa SA said on Wednesday it is seeking buyers to revive transmission-line and other construction projects in Brazil that the company had suspended after filing for creditor protection in Spanish courts.

The company, which owns energy, telecommunications, transportation and environment businesses, is looking for “a market solution” for projects it has been contracted to build and operate in Brazil, it said in response to questions from Reuters.

Abengoa is trying to reach an agreement with creditors before a March 28 legal deadline to avoid becoming the country’s biggest-ever bankruptcy. In early December, the company told Brazil’s national electricity regulator Aneel that it was stopping work on its Brazilian projects and had been in talks to sell or find partners for those projects.

“In Brazil, Abengoa is in permanent contact with local authorities to find a solution for our company’s projects that are in development in the country,” Abengoa said.

The work stoppages are expected to delay the completion of 1,700 kilometers (1,056 miles) of transmission lines needed to link the new Belo Monte hydroelectric project in Brazil’s Amazon with key parts of the national power grid.

As a result Belo Monte will be unable to generate as much power as expected, Aneel said in a recent report.

Brazil’s government is counting on Belo Monte, whose capacity of 11,200 megawatts is the world’s third largest, to boost the country’s electricity supply by about 10 percent. Average output from the dam will be about 4,500 megawatts.

This new power is needed to ease the pressure of growing demand during a drought that has sharply reduced hydroelectric output from non-Amazon dams in Brazil’s northeast and southeast regions. Brazil gets nearly two-thirds of its electricity from hydropower, but new projects are behind schedule.

Reporting by Luciano Costa; Writing by Jeb Blount; Editing by Richard Chang

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