Puerto Plata Barge-Mounted Power Plant

Active

The project consisted in a 185-MW residual oil and gas power plant. The power plant is mounted on two 300 foot-long ocean-going barges. The project is a joint venture between Enron Development Corp. and Smith Cogeneration International. The total cost of the project is estimated at $205 million. The developers have a power purchase agreement with Corporacion Dominicana de Electricidad (CDE), the state-owned utility. Under the agreement CDE pays $6.5 cents/kWh to the joint venture. The power plant started commercial operation in 1995. The plant suspended operation during the first-quarter 1996 because CDE could not pay for the electricity and owed the joint venture $4.5 million. After a contract renegotiation allowing the utility to make flexible payments, operations were restarted in second-quarter 1996. In 2003, Prisma Energy International Inc. was created as a holding company to, through its subsidiary Prisma Energy International Services LLC, provide management and operational support for the remaining major international assets owned by the bankrupt Enron, including Puerto Plata. The company was created after Enron's board and creditors decided the Enron estate would raise more revenues from ongoing operations than through individual asset sales. Once the Enron bankruptcy is concluded, Prisma was to be owned by Enron's creditors. They were likely to sell their positions as soon as market conditions allow. As of 2005, Enron still had a stake of 85% through Prisma. By mid 2003, the Dominican Republic was facing a power shortage. Distributors were not making power purchase payments because of the depreciation of the Dominican peso against the US dollar and the high price of oil. Smith-Enron claimed that government distributors owed them significant amounts of money. By end 2003, power production at Puerto Plata had ceased completely and the company was threatening to take their plants out of operation unless the government cleared its debt with them. San Felipe appealed the ruling to the Dominican Republic Supreme Court and the Supreme Court issued its final ruling upholding the appeal court ruling. The Company had accrued $11 million for this claim. In April 2009, San Felipe reached a settlement with the plaintiff for an amount not materially in excess of this accrual and the settlement was paid in May 2009. As of 2005, Enron was in the midst of liquidating its operations and distributing its assets to its creditors. http://www.prismaenergy.com/businesses/map/americas.html http://www.enron.com/corp/pressroom/icoassets.html