JPS Old Harbour LNG project start awaits drawdown of financing
Clean-up work at the site and construction of an access road is under way as part of the preliminary work for the construction of the 190-megawatt gas-fired power plant at Old Harbour Bay, St Catherine.
Power utility Jamaica Public Service Company (JPS) said all major contracts for the plant have now been finalised and the necessary regulatory approvals obtained from the Electricity Sector Enterprise Team and Office of Utilities Regulation.
Those include the contract with the equipment supplier; the engineering, procurement and construction contract; the 20-year power purchase agreement between South Jamaica Power Company (SJPC) and JPS; and the gas supply agreement with New Fortress Energy. Under the power purchase agreement, SJPC will sell the power generated by the plant to JPS.
The light and power supplier has not said what are now the timelines for construction and commissioning of the plant, given that the expected start-up date was set for the second quarter of last year, with finalisation of the project scheduled for July 2018.
The company has conceded, however, that given the delay, the plant might not be completed in time to meet the mid-2018 commissioning timeline.
"We are currently completing the final legal due diligence and technical review process to access funding from the banks," JPS said via email.
"We anticipate spending more than US$90 million in equity to fully develop this project over the next two years, with more than US$10 million being spent to date."
The project is expected to cost approximately US$300 million. Financing of approximately US$230 million is being provided by a syndicate of local banks and financial institutions led by National Commercial Bank.
JPS said the two primary environmental permits for the power plant and gas facility project have been secured from the National Environment and Planning Agency.
The company, through its subsidiary SJPC, has started clean-up work on the site as well as the construction of an access road.
Like the company's power plant at Bogue in St James, the Old Harbour Bay facility will be based on combined-cycle technology which is capable of burning both natural gas and automotive diesel oil.
Natural gas will be supplied through an offshore LNG terminal, or floating storage regasification unit, to be provided by New Fortress Energy, which will be selling the product to SJPC under a 20-year agreement.
Automotive diesel oil will be supplied from an onshore storage tank facility which will be built by SJPC's contractor.
Engineering procurement and construction company Power China has been contracted to build the plant.