SAO PAULO, April 22 (Reuters) - Brazilian regulator Ibama suspended on Friday an environmental license for the Sao Luiz do Tapajos dam in the Amazon after a study by indigenous affairs department Funai said local tribes in the area made it inviable.
With installed capacity of about 6.1 gigawatts, the project on the Tapajos River would be one of Brazil's biggest hydroelectric dams if built. It has also been a constant source of conflict with environmentalists and indigenous tribes.
The 30 billion reais ($8.3 billion) Tapajos dam would flood 376 square kilometers of forest that is home to some 12,000 Munduruku Indians, according to Greenpeace.
The suspension comes days after an even larger and better known dam, Belo Monte on the Xingu River, started operations. Belo Monte's first turbine started on Wednesday, exactly six years after an operating license was awarded to what is expected to be the world's third-largest dam.
A letter from Ibama's president to state-run power utility Eletrobras said the Tapajos license would not be approved unless Funai gives it a green light.
Brazil gets around three quarters of its power from hydro-electric dams, which President Dilma Rousseff calls a clean source of energy.
$1 = 3.6 reais Reporting by Luciano Costa and Caroline Stauffer; Editing by Bernard Orr