Two Brazilian power projects to be fuelled by B-to-B pipeline

July 16, 1997 El Paso Energy International Company it has signed a joint development agreement with Furnas Centrais Eletricas S.A. (Furnas), BHP of Brazil Energy, (BHP), Centrais Electricas Brasileiras S.A. (Electrobras), and British Gas of Brazil, to build a 450 MW gas fired power plant in the north of the state of Rio de Janeiro, Brazil.
The thermal power plant, located in the region of Macae, is one of the first to be fuelled by natural gas in the country and will include a 21.7 mile (35 km) electrical transmission line which will tie into Brazil's Interconnected Electric System. The companies involved expect to begin construction in the fourth quarter of 1997, with initial operations in 1999 and full commercial operations in the year 2000.
Furnas, a subsidiary of Electrobras, is the largest generator and transmitter of electric energy in the south-east and midwest of Brazil. Furnas holds a 10 % stake in the project while the other 4 partners equally share the remaining 90 % interest.

Earlier this month, El Paso International was named the low bidder on a project to build, own and operate a 150 MW power plant in the state of Mato Grosso do Sul in Western Brazil. The facility, to be located in Columbia, will be the first independent power project fuelled by natural gas in the region. Construction on the Mato Grosso do Sul power plant will begin in the fourth quarter of this year and be built in two stages. The first phase will provide 75 MW in simple cycle approximately one year after signing the power purchase agreement with Eletrosul, a subsidiary of the Brazilian utility Electrobras. The second phase of the project will provide an additional 75 MW in combined cycle by July 1, 1999. It is anticipated that the plant will be expanded to include an additional 150 MW in the year 2000. The Mato Grosso combined cycle power plant will be fuelled with natural gas from the Bolivia to Brazil pipeline, a project that is being jointly developed by El Paso Energy, British Gas, and BHP Petroleum (operating as the BTB consortium), and Petrobras, the Brazilian oil and gas company. Ultimately, the Furnas power project will be fuelled by the same pipeline. The 2,000-mile pipeline, the largest energy infrastructure project in the hemisphere, will connect Bolivian gas reserves with markets in southern and south-eastern Brazil. El Paso has a one-third stake in the BTB consortium.