Enap, Mitsui to bid for LNG-based power contracts

OREANDA-NEWS. December 25, 2015. Chile state-owned oil company Enap and Japan?s Mitsui signed a framework agreement to develop to two LNG-based power plants with a total capacity of nearly 1,200MW.

Mitsui will partner with Enap to develop the 760MW combined-cycle Luz Minera project in northern Chile and 510MW CCGT Nueva ERA in Concon on the central coast.

Enap and Mitsui will participate with the projects in tenders for long-term supply that will take place in 2016-18, Enap said. A major tender will be conducted in April 2016.

Luz Minera would use regasified LNG imported through the Mejillones terminal in the north. Nueva ERA would use gas from LNG imported through the Quintero terminal in the central region of Valparaiso. Enap owns 20pc of Quintero and is one of its three original offtakers.

Enap is expanding into the power sector to help stimulate investment and bring in newcomers to a sector that is dominated by a handful of generators. Critics have said its participation is unnecessary and tilts the playing field, because it is part of the government.

Enap chose Mitsui as its strategic partner in a competitive process which drew 16 groups in the pre-qualification stage, Enap said.

The criteria for selection included electricity market experience and access to LNG.

Enap and Mitsui did not indicate the level of shareholder interest each will hold in the projects.