Houston-based power company Ceiba Energy announces the successful bid of its Portocem project for a 15-year power purchase agreement for a new 1.6 GW LNG-to-power plant in Brazil.

Founded in 2015, Ceiba Energy is an owner, developer, and operator of power generation assets in Latin America. It is backed by Denham Capital, a global sustainable infrastructure and energy investment firm.

Ceiba Energy’s Portocem project won 30 per cent of the total demand offered by ANEEL and the Ministry of Energy in this first-of-its-kind capacity auction. The auction took place on 21 December 2021.

The Portocem LNG-to-Power Project will be installed in the Pecém industrial and port complex, in Ceará in northeast Brazil. It will include four, gas-fired, simple cycle units with a capacity of 1.6 gigawatts. In addition, it will have an associated Floating Storage and Regasification Unit (FSRU).

Moreover, the FSRU will open up possibilities to bring gas to the region supporting industrial growth and energy transition. Portocem is ideally located to connect to the existing gas pipelines and possible new gas infrastructure development. Additionally, the existing nearby electrical transmission infrastructure makes the location even more attractive.

Portocem’s capacity will go to the Brazilian market as a reserve contract, minimizing the risk of system-wide blackouts in low hydrology years, the firm says.

The project also has strong support from Ceará’s state government and others.

The project has a total investment of BRL 4.2 billion ($ 750 million). This will be financed from Denham Capital’s equity funds and debt to be raised from local sources.

Emilio Vicens, CEO of Ceiba Energy, said: “This fully integrated LNG-to-power Portocem project has the strong support of world-class industry players and local Brazilian institutions.”

Saurabh Anand from Denham added: “Brazil is a key market for Denham Capital where our investments help drive economic growth. Our significant investment in the Portocem project reaffirms our place at the forefront of financing the country’s energy sector and complements our investment in Rio Energy platform that currently owns 1.1GW of operating and under or near construction renewable energy projects.”