Enron International and Kenetech Energy Systems Inc. will be nearly ready to take some of the output from Trinidad and Tobago's LNG export project when it comes on line late this decade.
A 50-50 joint venture of the Enron Corp. and Kenetech Corp. subsidiaries has closed financing on a $670 million construction project involving a liquefied natural gas terminal, cogeneration plant, and desalination unit on the southern coast of Puerto Rico. The project, called EcoEléctrica, will be built in the island's Peñu elas/Guayanilla area.
EcoEléctrica will include a 500-MW combined-cycle power plant fueled primarily by LNG imported from the 400 MMcfd Atlantic LNG project on the island of Trinidad.
EcoEléctrica will purchase LNG under a 20-year contract with Cabot Trinidad LNG Ltd.-a 10% owner of Atlantic LNG Co. (OGJ, Oct. 20, 1997, p. 52).
An Enron official told Oil & Gas Journal that the contract enables the JV to purchase as much as 88 MMcfd from Cabot.
Cabot Trinidad LNG's parent, Cabot Corp., will purchase 60% of the LNG produced at Atlantic LNG's Point Fortin, Trinidad, plant, beginning in second quarter 1999. Cabot will deliver a portion of that LNG to a receiving terminal being built by EcoEléctrica.
Project details
The LNG receiving terminal will include a pier, docking and unloading facilities, and a 1 million bbl LNG storage tank.The power plant will include a 2 million gpd water desalination unit that will utilize waste heat. Desalinized water not used in the power plant will supplement public water supplies in the area.
The terminal, power plant, and desalination unit are scheduled to start commercial operations in fourth quarter 1999.
Power sales
Power from the new plant will be sold to Puerto Rico Electric Power Authority (Prepa) under a 22-year purchase agreement. Enron said the project "will also be the first opportunity for natural gas-the cleanest of all fossil fuels-to be used to generate electricity in Puerto Rico, which presently uses oil for 98% of its power generation."Miguel Cordero, executive director of Prepa, said one of the agency's principal goals is diversification of electric power sources. And the closure of financing for the LNG/power project is a solid step toward reaching that goal.
"The construction of the EcoEléctrica project will not only provide our system with additional, highly reliable capacity to meet the increasing demands for the next century but will mark a historic moment in the development of our electrical system, which frees us of the dependency on oil," said Cordero.
Rebecca Mark, chairman and CEO of Enron International, said, "(The project) will provide a clean, reliable, and economically attractive power source for Puerto Rico and significantly reduce (emissions of) greenhouse gases and other pollutants on the island."
Project financing
The EcoEléctrica LNG/power project will be constructed by an Enron affiliate under a turnkey contract. As part of the financial closing, Kenetech Corp.'s CNF Industries subsidiary sold its 50% interest in the construction contract to Enron for $15 million plus accrued expenses.According to Enron, the project will be the first to combine a private power plant and an LNG terminal as part of the same project financing.
ABN AMRO Bank and Bank Paribas are underwriting about $600 million of non-recourse construction and permanent financing.
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