Suez Energy International says it will appeal a court ruling ordering it to suspend construction work on the 1087 MW Estreito hydropower plant in Brazil.

Brazil’s federal court in Maranhão state passed the ruling following a complaint brought against the project developers by the Maranhão state government. The consortium building the plant will have to pay a $9 million fine if it fails to comply with the ruling, according to local reports.

Suez Energy International, the international business arm of the French energy group Suez, told MPS that it has not yet received official notification of the ruling and that it is not yet sure whether all construction work at the site would have to be completely suspended.

“We will ask the court to cancel the ruling on the grounds that suspending the project will affect the economic benefits that it will bring to the region in terms of employment and electricity,” a Suez spokesperson said.

Suez is building the plant on the Tocantins river along with partners Vale, Alcoa and Camargo Corrêa. The Estreito project straddles two states – Maranhão and Tocantins – and is due to start operating in 2010.

The federal court ruled that the impact area defined by the project’s environmental impact studies should be extended.

All the project’s environmental studies have been approved by IBAMA, Brazil’s federal environment agency, says Suez, which recently won the concession to construct a 3.3 GW hydropower plant on Brazil’s Madeira river. The company is also building the 243 MW Sao Salvador hydropower plant on the Tocantins river.

The EUR1.2 billion Estreito project is part of the Brazilian government’s Growth Acceleration Programme and is being partly financed by BNDES, Brazil’s development bank.