Norwegian energy company Equinor announced the acquisition of Brazilian onshore renewables company Rio Energy from energy transition investment firm Denham Capital.

The agreement includes the sale of the Rio Energy trade name, management team platform, and a project portfolio including the 0.2 GW Serra da Babilônia 1 onshore wind farm, a 0.6 GW pre-construction solar PV portfolio, and a project pipeline of approximately 1.2 GW.

Sarah Lane, Managing Director, Denham Sustainable Infrastructure said:

“The sale of these Rio Energy assets demonstrates Denham’s proven equity investment strategy, delivering sustainable growth alongside value creation in the middle market, and has positioned Rio Energy management for their next phase of expansion to deliver sustainable energy in Brazil.”

Founded in 2012, Rio de Janeiro-based Rio Energy develops, constructs, and operates renewable energy projects, including onshore wind and solar projects in Brazil. Denham will retain 1.1 GW of Rio’s assets.

According to Equinor, the acquisition aligns with its strategy, which includes the acquisition of local companies with high quality teams and pipelines to grow its onshore renewables business. Equinor launched its transition strategy in 2021, with plans to invest around $23 billion through 2026 in renewables, and to reach renewable energy installed capacity of 12 – 16 GW by 2030.  

Equinor stated that it expects the project portfolio to deliver within Equinor’s expected range of 4-8% real base project return for renewables projects, including the acquisition price.

Pål Eitrheim, Equinor’s Executive Vice President for Renewables, said:

“Through Rio Energy, Equinor will take a leading position in the rapidly growing Brazilian renewables industry. It accelerates production and cash flow, gives us a strong platform for growth, and adds capabilities and an attractive project pipeline.”

Marcos Meireles, CEO and co-founder of Rio Energy, added:

“We are delighted with the success we have achieved in partnership with Denham, to develop critical power generation for Brazil, and ensure positive socioeconomic impacts locally.

“We believe that now is the right time to move forward with Equinor, as we strive to deliver on our commitment to bring about a more sustainable future for Brazil.”