Brazil Potash has signed a non-binding memorandum of understanding with Gera Center for a proposed 28-year Build, Own, Operate and Transfer (BOOT) power arrangement at the Potássio Autazes Project in Amazonas. The proposed modular diesel facility would supply electricity during construction of two mine shafts before becoming an emergency backup system during the first 23 years of mine operations.
#Proposed power system for construction and operations
Under the terms outlined by Brazil Potash, Gera Center would supply, install, operate and maintain 63 containerised modular diesel generator sets with a maximum capacity of 20 MW.
The installation would be introduced in stages, beginning at 10 MW and reaching 20 MW during the first year. Because conventional grid power is not available at the site during the implementation phase, the plant would provide the main electricity supply for civil works and shaft excavation.
Once the mine begins operating, the facility would be used as emergency backup for 23 years if the planned 500 kV transmission line connecting the project to the Sistema Interligado Nacional (SIN) is interrupted. The proposed contract includes minimum operational availability of 98% during the backup period and a maximum response time of two hours for critical incidents.
#BOOT structure and proposed financial effect
Brazil Potash said the BOOT model would move approximately US$ 33 million in initial power-generation investment out of the project's construction budget and into operating costs distributed over 28 years.
The company also estimates net savings of about US$ 10 million over the life of the proposed contract compared with the figures in the project's Pre-Feasibility Study. These figures are company estimates and relate to an arrangement that has not yet been formalised through definitive contracts.
At the end of the proposed 28-year contract, the generation infrastructure would be transferred to Brazil Potash.
#Competitive selection process
Brazil Potash said Gera Center was chosen through a formal competitive process involving 12 companies with experience in the Amazon region. Eight companies submitted formal proposals, while four advanced to the final evaluation stage.
The proposals underwent technical and commercial review before Gera Center received the highest assessment over the proposed 28-year contract period, according to Brazil Potash.
#Definitive agreements remain outstanding
The first power supply could begin within 120 days after the definitive contract is signed. Brazil Potash said the parties will work towards final agreements in the coming months, with the intended installation schedule aligned with the planned excavation of the mine shafts.
However, the MOU is non-binding. Brazil Potash said there is no guarantee that definitive contracts will be signed or that the transaction will be completed on the terms currently contemplated.
#Project and company context
The Potássio Autazes Project is being developed by Brazil Potash through its wholly owned subsidiary Potássio do Brasil. The company says the project is intended to expand domestic fertiliser supply, with production planned for the Brazilian market.
Gera Center, based in Manaus, provides modular diesel-generation services for industrial, mining, agribusiness, infrastructure and construction operations. For the Autazes project, the company plans a modular facility with 20 MW of capacity. The project is expected to generate approximately 200 direct and indirect jobs during its implementation and operation phases.
#Key Takeaways
- Brazil Potash and Gera Center have signed a non-binding MOU for a proposed 28-year BOOT power contract.
- The proposed 20 MW diesel plant would support construction of two mine shafts before providing emergency backup for 23 years.
- The system would comprise 63 generator sets, scale from 10 MW to 20 MW during the first year and carry proposed backup availability of 98%.
- Brazil Potash estimates approximately US$ 33 million in investment would move into operating costs, alongside about US$ 10 million in estimated savings versus the Pre-Feasibility Study.
- Definitive contracts have not been signed, and completion on the currently proposed terms is not guaranteed.
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