Peru Lng Inaugurates The First Natural Gas Liquefaction (lng) Plant In South America

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11th June 2010, 07:02am - Views: 668





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MEDIA RELEASE PR39962


PERU LNG Inaugurates the First Natural Gas Liquefaction (LNG) Plant in South America


MELCHORITA, Peru, June 11 /PRNewswire-AsiaNet/ --


          Peru becomes a leading player in the regional energy sector.


            The startup of the Melchorita Plant also incorporates the

          commissioning of a 408-km pipeline and a marine terminal.


    On June 10th the first natural gas liquefaction plant in South America

was officially inaugurated. At US$3.8 billion in investment, PERU LNG

represents the largest investment in one single project ever made in Peru.



    (Photo: http://www.newscom.com/cgi-bin/prnh/20100610/DA19134)


    President Alan García Pérez, several government authorities, political,

business and opinion leaders, along with the many Peruvians that work at the

Plant, attended the official opening of the Melchorita Plant, located at km.

170 of the South Pan American Highway.


    The start of operations at Melchorita launches Peru into a new era, one

in which the high level of investor confidence and legal and economic

stability act as a magnet for mega investment projects. The startup of PERU

LNG represents the opportunity to continue the current economic growth trend

and reassert the country's reputation as a thriving and safe destination for

investment.


    As a result of this project, Peru's gross domestic product expanded 2%

during the construction phase (2006-2010) and over 30,000 jobs were

generated. Looking forward, forecasts predict that the Peruvian State will

receive approximately US$310 million a year due to the Project.


    The Melchorita Plant will produce liquefied natural gas (LNG) through a

purification and cooling process which will reduce the gas volume by 600

times, which facilitates its storage and transport. The plant has a nominal

capacity of 4.4 million tons per year and will process 620 MMcfd of natural

gas.


    In addition, at the plant site are the two largest storage tanks in Peru

(each stores 130,000 m3 of LNG) and a marine terminal that stretches more

than 1 kilometer long and will receive tankers of 90,000 to 173,000 m3 each.


    The Melchorita Plant is the result of a decade of planning and

development, which includes the installation of important pipeline

infrastructure that will also serve the Peruvian market. Thanks to an

agreement signed with TGP and recently approved by the Ministry of Energy and

Mines, the PERU LNG pipeline will provide up to 550 MMcfd of transport

capacity for the Peruvian market, which will clear up the bottleneck of gas

transportation to bring more gas to power generation companies, industrial

companies, vehicles running on natural gas, and Peruvian homes using natural

gas for heat.


    The Consortium

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    Four world-class energy companies form the PERU LNG consortium: Hunt Oil

Company of the United States, with a 50% participating interest; SK Energy of

South Korea, with a 20% participating interest; Repsol of Spain, also with a

20% participating interest; and Marubeni Corporation of Japan, with a 10%

participating interest.


    This consortium was specifically set up to develop, build, and operate

the PERU LNG Project. Several experienced construction contractors were hired

to make this Project a reality: Chicago Bridge & Iron (CB&I) in charge of the

plant's engineering, procurement and construction (EPC); the CDB consortium

(Saipem, Jan de Nul and Odebrecht) in charge of the marine terminal

engineering, procurement and construction (EPC), and Techint responsible for

installation of the pipeline. Several Peruvian companies like Graña &

Montero, Cosapi, Translei, Minera San Martin, Cosmos, Aceros Arequipa,

Tecnicas Metalicas, Esmetal and Sima, among many others, have also

contributed to the project.


    The project received financing of US$2.25 billion in total, which

includes financing from highly reputed international entities, as well as

financing from the local Peruvian market. The international financing comes

from the Inter American Development Bank (IADB), the International Finance

Corporation (IFC) of the World Bank, the Export-Import Bank of the United

States, the Export-Import Bank of Korea, the Italian Credit Export Credit

Agency (SACE), Société Générale, BBVA, Crédit Agricole-CIB, Sumitomo, ING,

Mizuho, and the Bank of Tokyo-Mitsubishi. In addition, a successful US$200

million bond offering was made in the local market to secure more capital.

Banco de Credito del Peru and Scotiabank Peru provided a US$75 million

working capital facility and the partner companies made a US$1.6 billion

capital contribution.


    Social responsibility

    During the construction period (2006-2010), approximately US$20 million

was invested in social and environmental programs. The highest national and

international standards were implemented to ensure exemplary performance,

demonstrating the project's commitment to respect the environment and local

culture in all activities.


    More than 20,000 families have benefitted from the range of social

responsibility programs implemented by PERU LNG. Exemplary programs have been

implemented as part of this commitment, such as Allin Minkay, which promotes

agricultural and livestock competitiveness in the Andean highlands and

ForPyme, which strengthens small and medium size enterprises in the coastal

area.


    In addition, extensive environmental programs have been implemented along

the entire pipeline area and near the plant. These biodiversity and

conservation programs not only meet, but surpass, the highest national and

international environmental standards.


SOURCE: PERU LNG


    CONTACT: Jeanne Phillips, 

             Senior Vice President, 

             Corporate Affairs & International Relations,

             +1-469-231-3309, 

             for Hunt Consolidated, Inc.


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