BP Amoco and partners sanction major 'wellhead to wire' integrated energy project

BP Amoco has sanctioned a multi-million dollar investment for the Atlantic Basin's first fully-integrated liquefied natural gas (LNG) power project, in northern Spain.

The Bahia de Bizkaia project, in which BP Amoco has a combined 25% interest, is the largest ever investment in the Basque country. The project consists of an 800-megawatt combined cycle gas turbine power plant, a 2.75 billion cubic meter a year (bcma) regasification facility, LNG import terminal and a total of 300,000 cubic meter storage capacity.

The three other partners in the project are Repsol YPF, Iberdrola and EVE, the Basque Energy Authority. Each has 25% equity in the groups that will develop the facilities—the Bahia de Bizkaia Gas group that will develop the regasification plant and the Bahia de Bizkaia Electricidad group that will develop the power station.

"This is a further commitment to Spain, an important energy market and one of the fastest growing natural gas markets in Europe. Over the next decade, natural gas consumption is expected to double to well over 30 bcma" according to Dr. Zin Smati, president of BP Amoco Global Power.

Bilbao-based contractor Babcock and Wilcox Espanola has been appointed to lead the construction consortium for the power plant. The contract is worth around $310 million. Spanish company Initec will lead the consortium to construct the regasification plant as part of a contract worth some $240 million. Construction is expected to begin towards the end of this year, with the power station due to begin generating by end 2002 and the regasification facility commissioned by mid 2003.

Of the regasification plant's output, 1.1 bcma will be supplied to the power plant, 1 bcma for Gas de Euskadi, the gas distributor for the Basque country, and 0.6 bcma supplied to Repsol. The facility will be designed for potential future expansion to 6 bcma.

Earlier this year, the Government of Trinidad and Tobago approved a two-train LNG expansion project for the Atlantic LNG facility in which BP Amoco and Repsol are shareholders. BP Amoco will supply just over 60% of the natural gas for the two trains. Some 60% of the output of the expanded plant will be sold to Spanish buyers including Repsol S.A. for use in the Spanish market.

Edited by David Nakamura