IPOs gather momentum in Latin America’s energy markets

Initial Public Offerings (IPOs) in Latin America are becoming ever-more important as a funding mechanism for the development of the region’s electricity and wider energy sectors, which are key to its continuing economic growth.

Brazil, for example, is one Latin America nation where IPOs have become an important tool in financing energy projects.

Most recently, Light Energia, a subsidiary of Brazilian company Light, requested permission from the Comision de Valores Mobiliarios de Brasil (CVM) to quote on the stock market.

Light Energia currently operates five hydropower plants with an estimated capacity of 853 MW. The plants are located in Rio de Janeiro, Sao Paulo and Minas Gerais states.

Meanwhile in Mexico, Cementos Mexicanos or CEMEX has confirmed its participation in a renewable energy fund that has been established to finance several wind power projects, and thereby capitalising on the country’s significant wind potential.

According to Diario Crítico, the fund is expected to bring in $300 million through a public offering of Capital Development Certificates on Mexico’s stock market.

The certificates were first introduced in 2009 as part of an initiative to help finance infrastructure projects in the country, and they continue to attract a lot of attention from retirement pensions, known as Afores.

CEMEX’s chief officer confirmed that the multinational would be providing the necessary technical support to the fund's renewable energy activities and to every such project included in the fund.

This will include CEMEX managing and advising on the fund's work and supplying a professional team trained in energy project implementation. In addition, the multinational will provide a network of contacts that can advise the fund during the negotiation processes needed to establish the wind farms.

Within the wider energy market, i.e. oil and gas, in Latin America, Argentina is also using IPOs as a way to generate project funding.

Earlier this year, Gas y Petroleo del Neuquen launched an IPO in Buenos Aires and subsequently on the New York and Toronto stock markets to help finance investment in one of the region’s major hydrocarbon deposits.

Vaca Muerta, which is located in Neuquen territory, is a vast hydrocarbon field containing large reserves of both unconventional oil and gas. It has been estimated that its exploitation will enable Argentina to double its hydrocarbon production within ten years.

In late October, work to drill the first shaft got underway. It is located in Aguada del Chanar Occidental. According to the Neuquen government, within the first 30 days the shaft will reach a depth of 2950 metres.

The extraction of unconventional hydrocarbons, however, is more complicated than with conventional resources, and therefore more expensive. Thus IPOs are gradually becoming recognised as an efficient way to raise funds to finance such high-CAPEX energy projects such as the one in Argentina.

IPOs are also being seen as an important way to fund the much-needed power generation capacity expansion and T&D infrastructure build in both Central and South America.

For more Latin America news.

Follow Power Engineering International on Twitter




Related Articles

Alstom wins $110m Brazilian windfarm connection deal

Alstom has been awarded a turnkey contract worth around €100m ($110m) to integrate wind farms into Brazil’s transmission grid.

China windpower capacity to treble by 2025

China’s installed wind capacity will treble from 115.6 GW this year to an estimated 347.2 GW by 2025, according to a new report.

Latest Articles
Hinkley Point C graphic info

EDF announces £1.3bn worth of contracts for Hinkley Point

EDF has announced a number of contracts for the development of the Hinkley Point C nuclear power project in southwest England.

Abbott

Fresh blow for wind power in Australia

Another blow has been dealt to the wind power industry in Australia with the news that a Senate committee has advocated new limits to the subsidisation of the technology.

Semirara Mining & Power

1100 MW of new coal-fired power plants planned for Philippines

Semirara Mining & Power is looking to expand its generation portfolio through the building of at least two large coal-fired power plants over the next three to four years.


Editor's Picks

EU flag

Luxembourg government working on Hinkley Point C legal objection

As promised earlier this year, the Luxembourg government intends to file a lawsuit against the European Commission decisio...
David Cameron and Werner Faymann

Nuclear chief says Austrian legal action ‘damaging to efforts to address climate change’

The Austrian government has finally filed its legal challenge against the deal that facilitates subsidies for a nuclear po...
 Schleswig-Holstein Climate Minister Robert Habeck

Federal states applying pressure on Merkel government over subsidies to nuclear

States with green party representation in Germany are calling on the German government to take action against the prospect...
Mike Baston of Euracoal

Future global power generation mix – the coal-fired power perspective

In our inaugural PEi Google Hangout, Mike Bostan, Policy Officer at Euracoal tells Power Engineering International's Diarm...
Faymann

Austrian PM confirms lawsuit against Hinkley decision ready in weeks

Austrian Chancellor Werner Faymann has confirmed that his country will be registering its lawsuit against the European Com...

Editorial Guides

Lubrication Challenges for the Biogas Industry in 2015

The biogas industry is growing in importance as the world continues to look for alternative, clean energy sources. However...

Maximising Power Plant Efficiency

The need for power plants to operate at maximum efficiency and flexibility while cutting emissions is greater than ever be...

How to cut your OPEX

How to cut your OPEX In a constantly evolving electricity market, factors such as over capacity and low coal costs can pu...

Buyers Guide Companies

ComRent International LLC

Offers rentals, sales, and services of load banks for testing generators...

Advanced Energy

Advanced Energy is a global leader in innovative power and control techn...

ACOEM AB

ACOEM is a supplier of Fixturlaser's innovative and user-friendly equipm...

Fluid Energy Controls Inc

CCI Thermal Technologies Inc

A leader in the development and manufacturing of industrial heating and ...

Buyers Guide Products

Fixturlaser NXA Pro

This laser alignment system features many ...

Bore Measurement

Typical applications are full bore measure...

Exhaust Systems

Leader in Exhaust Bypass, Simple Cycle, Ex...

RETROFIT

Braden's retrofit strengths are divided in...

Air Filtration

Braden filtration offers a wide range of f...

Power Engineering International

Whitepapers

Bridging the Power Gap in Africa: Testing options to manage constrained short to medium term system operations

Around the world, existing power systems face increasingly constrained operations in the short to medium term with available ageing generation capacity.  In this paper, PLEXOS® has been used t...

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New challenges and opportunities are continually appearing thanks to dramatic developments in technology...

The bottom line: engine oil impact on engine reliability

A reliable and well-maintained gas-powered engine performs consistently and continuously, which can lead to a healthier bottom line for plant operators. There is a raised awareness around the need ...

Understanding Moisture Dynamics in Power Transformers

In this webinar recording "Moisture Dynamics in Power Transformers" (held originally in September 23, 2014) you will have a chance to learn about the phenomena and its importance to your ...

Latest Digital Edition

  Power
  Engineering
  International
Look Inside >
Cover
Current Issue

Article Archives for Power Engineering International Magazine