Mining companies in the north of country will call for bids for at least 1,200 MW while power supply offers are scarce
03-Jul-2012 Diario Financiero – News
BHP and Collahuasi are in the process of contracting about 600 MW and 680 MW energy blocks each
Mining companies in the north of country will call for bids for at least 1,200 MW while power supply offers are scarce
Only two plants are currently offering power supply: Cochrane and Infraestructura Energética, however Cochrane is about to close a deal
The two most important mining companies in the north of country are developing two calls for bids for energy supply. On one side BHP Billiton will be quoting 680 MW – although some sources state it could even reach 800 MW-, while on the other side Collahuasi –linked to Anglo American and Xstrata- has already called for bids for 600 MW to supply its Cordillera Expansion and Patache Ports facilities. Both shall then total about 1,200 MW to be added to the energy demand of SING system to be served during the forthcoming years.
In the meantime, other mining companies that are also preparing similar call for bids for this period are Quebrada Blanca 2 – owned by Teck-Canada, Sierra Gorda – Quadra Mining, and a somehow fresher, Zaldívar expansion – Barrick, and North Division of Codelco for Chuquicamata Underground and Ministro Hales projects.
However, the problem here is that there are no generation sources available this time to serve those contracts. The only base plants approved by SING are Infraestructura Energética (E-CL) with 750 MW capacity, and AES Gener’s thermoelectric power plant, Cochrane, with approximately 560 MW capacity. Thus, available offer is for 1.310 MW. However, even if it would be enough to cover both contracts it is not completely certain that the power plant throughput would be completely and exclusively assigned to satisfy these contracts’ requirements.
Either way, each generation project continues its course. At the same time Infraestructura Energética is looking for partners it is also in the process of awarding the power plant. The Spanish Cobra may be mentioned amongst participants. Besides they are also defining their strategy for energy contracting. On the other side, Cochrane is also going through the same process although somehow ahead as regards to supply negotiations. As informed by some sources in the industry, AES Gener would be about to close a deal with Quadra Mining for the Sierra Gorda project.
Thus, BHP and Collahuasi are only left E-CL power plant to cover their power supply needs. And although both of them consider an amount of NCRE – approx. 300 MW for Collahuasi and an amount still to be defined for BHP – power requirement is high when considering a single power plant supply.
Thus and due to the difficultness in finding offers, BHP is proposing, along with its company group, to have the awarded company build the Kelar power plant the mining has in its projects folder and which has already been approved by the environmental authorities. The power plant would provide about 500 MW. However, it seems the offer is not quite attractive to everyone, some years ago it was declined by the constructor to whom it had been awarded.
A chance for GasAtacama
Dilemma is falling over other mining projects. GasAtacama could be a potential winner as from the 760 MW capacity it has, about 600 MW are uncommitted, as stated by Francisco Aguirre from Electroconsultores. Besides, this being an already built power plant it would also be more likely to opportunely meet the committed delivery terms. However, other experts consider the dilemma resides in the company finding a gas supplier with a long-term contract which seems hard to find nowadays, particularly because of the company current situation where partners are going through an arbitration process that might even take years.
