Finnfund has provided a senior loan facility worth USD 20 million to Methax S.A. for building a power plant in Mendoza, Argentina. The project company Methax is owned by a power investor Grupo Galileo. The power plant is supplied by Wärtsilä.
The power plant will generate electricity from liquefied natural gas (LNG) which will be obtained as a by-product of oil production or from stranded gas wells using Grupo Galileo´s solution, the Cryobox-Trailer® LNG. A material portion of this natural gas would have otherwise been flared or vented, generating significant carbon dioxide emissions.
Finnfund’s funding is aimed at supporting the reduction of emission in the country, hence mitigating climate change. It is estimated that, once operational, the project will decrease emissions up to 300 tons of CO2eq a day compared to a situation where the natural gas would be flared. The reduction of emissions can grow up to 10 times, i.e. up to 3,000 tons of CO2eq per day, when compared to venting the same amount of natural gas. In addition, the project strengthens energy production and supports development of the energy sector in Argentina. Once ready, the power plant will generate electricity for approximately 15,000 households.
The project is based on a 10 year power purchase agreement with CAMMESA, the national grid system operator. Total investment in the project is over USD 80 million.
”This is an exciting project for Grupo Galileo. It will be the first power plant in the world operating with LNG produced directly at the wellhead through our innovative LNG Distributed Production model, which provides great flexibility to build power stations in strategic locations,” said Mr. Osvaldo Del Campo, President and CEO at Grupo Galileo.
“We are pleased to provide finance for Methax and contribute to the efforts to decrease carbon dioxide emissions in Argentina. Together with Wärtsilä, we can provide Finnish support and expertise for this important project,” says Mr. Jaakko Kangasniemi, Managing Director at Finnfund.
“Wärtsilä provides fast track delivery of this power plant on engineering, procurement and construction basis. Thanks to the innovative fuel supply arrangement developed by our customer Grupo Galileo and the very high efficiency of the Wärtsilä 34SG gas engines the project supports Argentina in its transition towards a more affordable and sustainable energy system,” says Mr. Kent Westergård, Sales Director at Wärtsilä.
For more information:
Finnfund: Jaakko Kangasniemi, CEO, tel. +358 40 577 7676, jaakko.kangasniemi(a)finnfund.fi
Finnfund (Finnish Fund for Industrial Cooperation Ltd) is a Finnish development finance institution, aiming to foster sustainable development by providing long-term risk capital for private projects in developing countries. Investment criteria include profitability, sustainability and positive development impacts. Since 1980 Finnfund has made nearly 370 investments in almost 70 countries. Currently, Finnfund has approximately 613 million euros invested in or committed to 167 projects in 34 countries. For more information, please visit www.finnfund.fi