AMEC backs away from Brazil

DESPITE Brazil being considered a major growth market, London-based engineering firm AMEC will leave the country by the end of the year.
AMEC backs away from Brazil AMEC backs away from Brazil AMEC backs away from Brazil AMEC backs away from Brazil AMEC backs away from Brazil

According to sister publication Mining News Brazil (Noticias de Mineracao), AMEC will close its Belo Horizonte office next month.

The company's office in Belo Horizonte has about 30 employees, but had as many as 150 early last year, a source familiar with the matter said.

The lack of contracts in the mining sector in Brazil and broader Latin America was the main reason for the closure, according to the source who asked not to be identified.

An AMEC spokeswoman confirmed the closure, but said the company remained committed to Brazil.

"AMEC has decided to close its Belo Horizonte office due to the downturn in the mining market in Brazil (particularly for EPCM projects), but we remain committed to the mining market in Brazil and over the short term will serve clients from our other global operations," the spokeswoman said.

"In the future, when the mining market returns to growth in Brazil, we expect to rebuild our in-country capability to deliver EPCM services to our customers. AMEC remains fully committed to all of its other offices in South America."

The office in Belo Horizonte was opened in 2005 by Australia's GRD Minproc, which was acquired by AMEC in 2009.

The company recently opened an office in Rio de Janeiro, which services the growing oil and gas projects, and the spokeswoman said it was expanding rapidly.

AMEC chief financial officer Ian McHoul acknowledged a slowdown in Brazil when the company released its results earlier this month.

"Demand in that market has fallen, the activity has fallen, so the revenues aren't there. And when the revenues aren't there then the fixed costs come through," he said.

"We're obviously hoping very much with the news around Brazil and investment in Brazil starting to look a little bit more rosy than it did. We hope that situation turns around. And obviously that's the plan."

AMEC has offices in 44 countries and employs about 29,000 people.

Mining News Brazil contacted AMEC about the closure, but the company could not be reached.


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