BRAZIL (SeeNews) -- Brazilian cellulose firm Eldorado Brasil will develop a biomass project in Mato Grosso do Sul with the capacity to produce 50 MWh, local media reported on Wednesday.

Named Onca Pintada, the plant will generate energy using wood chips from eucalyptus stumps and roots as raw material. The company will invest about BRL 300 million (USD 84.6m/EUR 74.2m) in the project, secured during last week's energy auction.

The facility will start supplying power in January 2021, as established in the auction, for a price of BRL 243.2 per MWh under a contract with a total value of BRL 2.5 billion and a 25-year term.

The company can build six more plants of the same size, providing more than 300 MWh of energy to the national grid, said Jose Carlos Grubisich, president of Eldorado Brazil, as quoted by local media.

(BRL 1 = USD 0.282/EUR 0.248)