Language
5th November 2008
Rurelec PLC (AIM: RUR), the power plant developer and owner-operator of power generation assets in Latin America, announces today that it has signed an agreement, subject to the satisfaction of conditions precedent, for a forward sale of CERs expected to be generated by its wholly-owned subsidiary Energia del Sur ("EdS") from the end of this year through to December 2012.
This forward sale benefits from a fixed price and on the basis of expected CERs to be generated, is valued at Euro 9 million (approximately £7.3 million). This amount will be paid by a large European utility on the basis of total CERs verified and delivered by EdS each year, from 2009 until 2013. A right of first refusal to acquire CERs generated subsequent to 2012 has also been negotiated.
EdS is the owner of the existing 76 MW gas fired open cycle power plant in Patagonia, Argentina.It has nearly completed expansion of the plant by adding 60 MW of steam turbine capacity and converting to combined cycle operation in Comodoro Rivadavia, one of the principal gas producing zones of Argentina. The CCGT capacity is due to enter commercial operation in November 2008 and will help alleviate some of the power shortages which have been forecast in Argentina.
Under the combined cycle conversion, the waste heat from the two existing General Electric 6B gas turbines is channelled through two new heat recovery steam generators ("HRSGs") which have been installed on site. Instead of being released directly into the atmosphere, the waste heat from the existing power plant is captured by the HRSGs. This in turn allows electricity to be produced by a single steam turbine synchronised to the two original gas turbines from the same consumption of natural gas as is currently used to fire the open cycle gas turbines.
EdS expects to generate approximately 40 per cent. more electricity in combined cycle, compared to the current production in open cycle, without any increase in gas usage. This significant reduction in gas consumption per MW generated reduces the new CCGT unit's emissions of CO2 for every MW hour of electricity generated.
For further information, please contact:
Peter Earl
Managing Director Tel. 020 7793 5610
Paul Shackleton/ Stewart Dick
Daniel Stewart & Company Tel. 020 7776 6550
Leah Kramer
Parkgreen Communications Tel. 020 7933 8780