South Jamaica Power Company (SJPC) will commence site preparation this month for the 360 megawatt (MW) liquefied natural gas plant on which construction is scheduled to begin in the second quarter of 2013.
The project aims to slash US$217 million (J$19.7b) in oil imports from the balance of payments, according to SJPC in its Environment Impact Assessment (EIA) offered to government agency, National Environment and Planning Agency (NEPA).
Jamaica has already imported US$1.2 billion in mineral fuels between January and June 2012, according to Bank of Jamaica data.
The plant will take two years to develop, according to the environmental report.
The project will cost over US$614 million based on previous statements by Jamaica Public Service Company (JPS).
SJPC to build plant
SJPC, which was incorporated in Jamaica in January 2012, will build, own and operate the 360 MW-combined cycle-power plant to be developed on a 300-acre property in Old Harbour.
The new company is owned 40 per cent by Marubeni Japan; 40 per cent by Korea East West Power; and 20 per cent by JPS. Its directors include Valentine Fagan, Kim Chi Wan and Seiji Kawamura.
SJPC will sell power to JPS under an independent power-producer agreement. The environmental report said SJPC will secure the LNG to power the plant as the Jamaican Government has opted out of such an arrangement.
When the plant becomes operational, it will replace the 41-year-old steam units at Old Harbour, which produce 223.5 MW and the 36-year-old B6 unit at Hunts Bay at 68.5 MW.
"The introduction of LNG expects to bring 30-40 per cent reduction in overall cost of electricity to Jamaica. Based on an analysis done by JPS, the new plant will help achieve a 30-per cent reduction in the system heat rates by 2015 when operating natural gas," stated SJPC in its EIA.
"It is estimated that implementation of this project could result in an annual reduction of around US$217 million in the cost of imported fuel thereby bringing significant improvements in the country's balance of payments situation."
The project construction will provide 1,200 jobs of which 800 will go to skilled workers.
steven.jackson@gleanerjm.com
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