Brazil: £10bn Amazonian dam approved

Brazil's environment agency gave definitive approval yesterday for construction of the Belo Monte hydroelectric dam, a controversial $17bn (£10.3bn) project in the Amazon that has been criticised by native Indians and conservationists.

The regulator, Ibama, issued licences to the consortium in charge of Belo Monte to build the dam on the Xingu River, an Amazon tributary. The government saysthe 11,200-megawatt project, due to start producing electricity in 2015, is crucial to provide power to Brazil's economy.

It will be the world's third-biggest hydroelectric dam, after China's Three Gorges and Itaipu on the border of Brazil and Paraguay. In January, Ibama issued a preliminary licence allowing the construction site to be set up. Since then the project has been halted and resumed several times due to court injunctions obtained by environmentalists and native Indians opposing the dam.

Conceived 30 years ago, progress on Belo Monte has been slowed over the years by protests, including a 2009 incident when Kayapo Indians attacked a state electricity official.

Critics of the dam include singer Sting, Hollywood director James Cameron and environmental group Greenpeace. The 3.75-mile dam will displace 30,000 river dwellers, partially dry up a 62-mile stretch of the Xingu river, and flood large areas of forest and grass land.