BW Group said a $128.3 million financial package has been arranged with IDB Invest, the private arm of the Inter-American Development Bank, to help fund a converted floating storage and regasification unit (FSRU) as part of a gas-for-power project in the Latin American nation of El Salvador.
The financial package has a 15-year contractual term. The funds provide resources for the purchase and conversion of the “BW Tatiana” LNG carrier to an FSRU.
This is the region's first FSRU, which will be permanently moored at the Port of Acajutla in El Salvador.
A BW Group subsidiary, BW LNG, is developing the project with Invenergy, a multinational power generation and operations company.
“The power project’s use of natural gas will reduce the country's reliance on imported diesel and heavy fuel oil-fired generation, resulting in significant environmental benefits,” said the developers.
Invenergy and BW LNG will jointly commission, operate and maintain the FSRU.
“BW is grateful for the opportunity to bring clean, affordable energy to the region, with the support of Invenergy and IDB Invest,” said Jessica Cheung, Vice President for Treasury and Corporate Finance at BW Group, the Singapore-based shipping and oil and gas projects company with a fleet of around 420 tankers and ships, including 190 LNG and liquefied petroleum gas (LPG) vessels.
“Besides enhancing this project's competitiveness, we hope this financing encourages the development of many more LNG-to-power projects in the region,” added Cheung.
BW LNG said a key part of the El Salvador project was the FSRU, which will have regasification capacity of 280 million standard cubic feet a day and storage capacity of 137,000 cubic metres.
Regasified LNG will be transported via a subsea pipeline to the onshore 378-megawatts natural gas-fired power plant.
The El Salvador project is scheduled to be completed in 2022 and is expected to meet about 30 percent of El Salvador's energy demand.
“The close of financing for the FSRU represents a significant step forward in the completion of the transformational project, the foundation for El Salvador's clean energy future,” said Meghan Schultz, Senior Vice President, Finance and Capital Markets at Invenergy.
“This multi-component project is only made possible through the collaboration and support of our incredible partners, BW LNG and IDB Invest,” added Schultz.
