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AES Panama to receive maiden LNG cargo in May

10 Apr 2018 18:41 (+01:00 GMT)
AES Panama to receive maiden LNG cargo in May

Bogota, 10 April (Argus) — US utility AES will receive a commissioning cargo of LNG next month at its planned Costa Norte LNG terminal in Panama, company, government and maritime authorities tell Argus.

The Gaslog Seattle LNG tanker is scheduled to arrive in Panamanian waters tomorrow at 10am local time, according to the marine traffic division of the Panama Canal Authority.

The 155,000m3 Bermuda-flagged vessel, to be delivered by French energy company Engie, loaded its cargo last week at the Sabine Pass liquefaction complex in Louisiana.

"We are completing a few things at the jetty and as soon as they are ready the tanker will enter our installations," a senior project executive tells Argus.

The LNG will supply the 380MW AES Colon combined-cycle power plant that is the anchor for a 1.5mn t/yr regasification terminal featuring a 180,000m3 storage tank that is currently under construction. The total capital expenditures for the Costa Norte LNG-to-power project is $1.003bn, AES says.

Costa Norte, a 50:50 joint venture between AES Panama and Inversiones Bahia, is designed as a hub to supply small Central American markets through LNG reloads and trucking. The facility will also supply LNG for bunkering at the Atlantic mouth of the Panama Canal.

AES will use 25pc of the available regasification capacity at the facility, opening the remaining 75pc of capacity for other parties, potentially including two other gas-fired power projects in Panama.

In May 2017, AES and Engie signed an agreement to jointly market and sell LNG to third parties in Central America from Costa Norte. Engie agreed to supply 0.4mn t/yr of LNG to the Costa Norte power station starting in 2018. The company will provide up to another 0.7mn t/yr of LNG from Costa Norte to third parties, mainly from the Cameron liquefaction plant in Louisiana.

The agreement complements a separate 2016 agreement between AES and Engie to jointly market LNG to Caribbean markets from AES´ Andres regasification terminal in the Dominican Republic. The combined regasification capacity of Andrés and Costa Norte will be 3mn t/yr.

The two projects are aimed at meeting small-scale regional demand for gas that is replacing oil for power generation and industry. Costa Norte can load small cargoes starting at 3,000m3.

AES Colón says it will begin testing three steam recovery boilers at the new power station in Panama on 13 April, a process that will take around 30 days.

On April 4, AES said the power station is 98pc complete and will be inaugurated in August, while the LNG terminal is 81pc complete.