T-Power Partners Find Financing for 420-Megawatt Belgian Project

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Researched by Industrial Info Resources (Sugar Land, Texas)--Announcing secure long-term financing for the 420-megawatt Tessenderlo Chemie (Brussels, Belgium) industrial park power project in eastern Belgium, the CEO of International Power plc (OTC:IPRPY) (London, United Kingdom), Philip Cox, said that the development and successful financing of the project in challenging market conditions, was another demonstration that non-recourse finance was still available for high quality projects.

International Power's partners in the T-Power combined-cycle gas turbine project are Siemens Project Ventures GmbH, a subsidiary of Siemens AG (NYSE:SI) (Munich, Germany), and Tessenderlo Chemie. Each of the partners will have a 33% stake in the project, which will be constructed by Siemens under a full engineering, procurement and construction contract. Siemens will supply the single shaft SGT-40000 F turbine, which claims a thermal efficiency level of more than 57%. Tessenderlo Chemie is one of Belgium's leading chemical companies with more than 105 branches in 21 countries. The project will contribute to the competitiveness of Tessenderlo Chemie's operations.

After the commissioning of the plant in 2011, the power output will be sold to the Essent Trading International, a subsidiary of Essent NV (Arnhem, Netherlands), under a 15-year tolling agreement with the option of a five-year extension to the agreement. Essent is the Netherlands' largest energy supplier with 2.7 million private and business customers for electricity, gas and heat. Under the T-Power tolling agreement Essent will supply the natural-gas feed.

International Power, an independent electricity-generating company, will make a $31.5 million direct equity investment into the projects. International Power acquired its share from Advanced Power (Zug, Switzerland), the previous lead project developer. The company will operate the plant under a 15-year operations and maintenance agreement. Total project cost is estimated to be about $600 million and will be funded with 85:15 ratio of debt to equity.

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