15 Jan 2002 – Singapore’s Keppel Fels Energy the utilities services business arm of the Keppel Corporation, has clinched a contract to supply electricity to northeastern Brazil. The power purchase agreement [PPA] was signed by Nordeste Generation Ltda, Keppel Fels Energy’s wholly-owned Brazilian subsidiary, and Commercializadora Brasileira de Energia Emergencial [CBEE] on January 10.
Based on estimated contract capacities, the total revenue for the contract period is expected to exceed $400m. The Brazilian government will guarantee all obligations of CBEE under the PPA.
Under the PPA, Nordeste Generation Ltda will install and operate a 190 MW barge mounted power plant at the port of Aratu, Salvador in northeastern Brazil. Commercial operations will commence by June 2002 and end by December 2004.
Brazil has traditionally depended on hydroelectric power plants for over 90 per cent of the country’s generation capacity. Low rainfall due to climate changes has resulted in severe capacity shortage in northeastern Brazil. CBEE is the co-ordinating agency specially established by the Brazilian authorities to resolve this electricity crisis.
Mr Choo Chiau Beng, executive director of Keppel Corporations said in a press statement, “This PPA is a significant milestone in the delivery of Keppel’s announced strategy of growing infrastructure as one of its three key businesses. With this contract in hand, we are well on our way to meeting our growth targets for the Infrastructure division”.