Powergen
on target with two new Turbines
By
Raffique Shah
Trinidad
Express
Port
Spain
Petroleumworld.com
07 23 06
IN
preparation for increased demand for electricity
based on new heavy industries and thousands of new
houses coming on stream, Powergen, the country's
main electricity generating company, is currently
installing two additional gas turbines. The Siemens
simple cycle turbines, each with a capacity of 105
megawatts, are expected to become operational by
March 2007. Located at the Point Lisas plant, they
will take Powergen's installed capacity from 1,157
megawatts to 1,367 megawatts. Current demand for
electricity stands at around 1,000 megawatts. The
smaller Inncogen plant generates 225 megawatts.
Both power companies sell their electricity to T&TEC
on a contract basis.
Speaking to Business Express last
week, Powergen's CEO, Garth Chatoor, said his company
won the right to build and operate the new turbines
on competitive international tendering. "Government
invited bids from power companies worldwide, and
we won," he said. "I should add that the
project is within budget and on time. The turbines
are 501D 5A simple cycle from the reputable Siemens
company.
We have encountered no problems
in construction and installation, so we expect to
deliver on time. By March next year, the country
will have more than adequate power generated to
meet not only our current requirements, but exceed
it." Chatoor pointed out, though, that with
new plants and massive housing estates coming on
stream over the next two-to-three years, there will
be increased demand for electricity.
Even as Chatoor spoke with Business
Express, Mirant Corporation, the US-based power-giant
that holds a 39 per cent shareholding in Powergen,
announced it was offering 43 million shares of that
company's common stock for sale. Mirant chairman
and CEO, Edward Muller, said in Atlanta last Wednesday
that his company would launch immediately "a
modified Dutch Auction tender offer for up to 43
million shares for an aggregate price of up to US$1.2
billion." Simultaneously, Muller announced
the commencement of an auction process to sell its
Caribbean and Philippines businesses. He added:
"Our strategic plan reflects our commitment
to enhance shareholder value, both through the return
of cash to our shareholders and through our continuing
US business." The "Dutch Auction"
went on the market last Thursday and will expire
on August 21.
Mirant's net ownership interest
in the Caribbean power businesses comprises 1,050MW.
The company has an 80 per cent interest in the Jamaica
Public Service Company Limited and a 55 per cent
interest in Grand Bahama Power Company. In Powergen,
it has a 39 per cent stake, and a 25 per cent interest
in Curacao Utilities Company. Mirant told prospective
buyers its Caribbean businesses contributed US$156
million in adjusted earnings before taxation and
other deductibles (EBITDA). What does this mean
for Powergen?
According to one source, the agreement
among Powergen's shareholders, of which T&TEC
has majority shareholding, is that the distributor
will have first preference in any such sale. "And
I have no doubt that T&TEC, through government,
will exercise this right," said the source.
"Whatever it costs, government will want to
ensure that a strategic element to our development
like power generation remains under state or local
control. Besides, the Government has the money to
make the purchase.
If anything, Mirant's departure
will mean greater local control." Leroy Meyers,
Permanent Secretary at the Ministry of Energy, said
he was aware of the
Mirant sell-off. But he had no word
on what Government would do. "We learned of
this only a few days ago as far as I know, the issue
has not yet been addressed."
Chatoor meanwhile said while his
company has not yet discussed the projected demands
of some of the mega-industrial-plants that are expected
to be established here, Powergen was ready and willing
to bid, construct and operate the power plants required
by these companies.
Chief among them is the Alcoa aluminium
smelter, which, if it crosses the hurdles of the
environmental lobby against it, will require around
650MW of power. Alutrint, which is smaller and slated
for Union Estate in La Brea, will require a 300MW
plant. "From what we understand, these types
of plants will want the power generating units on
their premises," Chatoor added.
"The main reason for this is
they demand high reliability of supply. There cannot
be failures during their operations. If, for example,
power goes while the smelter is in operation, molten
aluminium solidifies, and there is serious damage
to their carbon pots. Several challenges arise from
these needs. There will be a back-up-power requirement,
which the company will have to establish. They will
also need on-site security, and 100 per cent reliability."
The power company's CEO said nothing
has yet been discussed about these two power plants,
which will have to be built and be commissioned
when the aluminium plants come on stream. "It's
early days yet," he said. "As you know,
there are several hurdles both companies are facing.
But if and when they get the go-ahead, Powergen
will be in a position to bid for those plants as
well.
I have the greatest confidence we
can win these contracts, and that we have the capability
to build and operate such plants. That will take
power generation in this country to levels unforeseen
a few years ago.
We
are talking here of moving from 1,000MW to 1,600MW
by the time our two new turbines come on stream
next year, and later, if these plants become operational,
2,850MW. Who will have dreamt of this two years
ago? But it's almost at our doorstep, and I can
tell you Powergen is ready to meet the challenge."
Trinidad Express
Wednesday, July 19th 2006
Copyright
©2006 Trinidad Express . All Rights Reserved.
