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PetroCaribe Fund invests in JPS's new Old Harbour power plant

Published:Wednesday | June 20, 2018 | 12:00 AMEdmond Campbell/Senior Staff Reporter

The PetroCaribe Development Fund has invested in the 190-megawatt power plant in Old Harbour, St Catherine, which is to be constructed at a cost of US$330 million.

With the Government of Jamaica holding 20 per cent shares in the Jamaica Public Service (JPS), it had the option of investing in the plant as a shareholder. However, chief executive officer of the fund Dr Wesley Hughes said that Cabinet, the Ministry of Finance, and the board of the fund instructed the public body to purchase shares in the joint venture arrangement between Marubeni, South Jamaica Power Company, and the JPS.

"The Government of Jamaica asked PetroCaribe to invest on its behalf given its 20 per cent share in JPS. We obliged and took up that option and invested in the power plant," Hughes added.

The JPS reported earlier this year that the 190-megawatt power plant was more than 40 per cent complete. The new plant is scheduled to be commissioned in June 2019.

As part of its mandate, the fund also provides loans to self-financing public bodies. Hughes noted that the loans provided to public bodies such as the Jamaica Urban Transit Company Limited, the Airports Authority, and the Sugar Company of Jamaica were being serviced and were current.

Further, the fund has provided loans to the Development Bank of Jamaica, which is the main provider of investment funds to the business process outsourcing sector. The PetroCaribe Develop-ment Fund does not lend directly to private entities.

The fund manages the proceeds that accrue to Jamaica under the PetroCaribe Energy Cooperation Agreement. Under the agreement, the Government of Venezuela agreed to convert a portion of each payment due for petroleum products supplied to PetroJam, the state-owned refinery, into a long-term concessionary loan.

The inflows that accrue to Jamaica under the arrangement are managed by the fund and are used to provide loans to self-financing public bodies for critical development projects.