The Estreito Hydroelectric Power Station (UHE Estreito), an undertaking of the Estreito Power Consortium (CESTE), is being constructed on the Tocantins River, on the border between the states of Tocantins and Maranhão, and will produce 1,087 MW of energy. The investment, estimated at R$ 3 billion, will generate nearly 5,500 direct jobs and 15,500 indirect jobs during the implementation phase. 

The undertaking is following a timetable that is divided into three phases. Phase Zero included installation of the construction site, with lodgings for the workers, a canteen, a leisure area and offices. The site, which covers 1,300 hectares, is where the Estreito dam is going to be constructed; it should be ready to start generating in 39 months as from February, 2007.

Phase 1 covers the excavation and earth-moving works for constructing the coffer-dams and the spillway, which will make it possible to start concreting (Phase 2), which consists in construction of the actual dam and the power station.

At the same time that work is being done on the construction site, other services are taking place, such as buying up properties, resettling the local population and relocating the infrastructure in the area of the reservoir and the Estreito Hydroelectric Power Station, which includes building and raising bridges, relocating transmission lines, building roads and mooring points, in addition to services directed at dealing with the various environmental variables.

The forecast is that the reservoir will start being filled in May, 2010 and that in September of the same year the first of the eight power generating turbines will start operating. The Estreito Hydroelectric Power Station should be fully operational by November, 2011.

The Estreito project was presented and widely discussed in various public hearings that took place between 2001 and 2004 in all the local communities in the municipalities surrounding the Estreito power station and its reservoir. The public hearings indicated a series of improvements and a series of commitments were incorporated into the Environmental Impact Study, which resulted in the Prior License being obtained in April, 2005, a document that testifies to the project’s environmental feasibility.

At the end of 2006, the Basic Environmental Project was approved by IBAMA (Brazilian Institute of the Environment and Renewable Natural Resources), an agency linked to the Ministry of the Environment, and the Installation License for constructing the Estreito Hydroelectric Power Station was granted. 

Alcoa has a 25.49% participation in the Consortium. The other participants are Suez Energy South América Participações Ltda. (40.07%), Companhia Vale do Rio Doce (30%) and Camargo Correa Energia S.A (4.44%). The use concession for exploiting the power station was acquired at an auction, held by the National Electricity Agency (ANEEL) on July 12, 2002, in the Rio de Janeiro Stock Exchange. 

The power produced by the Estreito hydroelectric power station will feed into the North/Northeast and North/South/Southeast power grid systems and can be distributed throughout the whole of Brazil to industrial and residential consumers, including to those who live in the region where the power station is going to be built.