Rio Bravo IV

completed

The Rio Bravo IV project is the construction and operation of a natural gas-fired combined cycle power plant of 500 MW (two Westinghouse 501 F combustion turbines of 180 MW and two heat recovery steam generators and one steam turbine generator of 187 MW nominal) to be located next to the Rio Bravo III plant. Rio Bravo IV has entered into a 25 year Power Purchase Agreement (PPA) to sell electricity exclusively to Comision Federal de Electricidad (CFE), Mexico''s state-owned electricity utility. Rio Bravo IV will contract with third parties for the supply and transport of gas to the plant. The long-term (until 2021) gas supply contract will be with a US gas company, Cinergy Marketing and Trading, LP, which will be providing gas from the USA. Two new open-access gas pipelines (one of 16 km in Texas, USA owned by Tennessee Gas Pipeline and the other of 52 km in Mexico owned by Gasoducto del Rio, a separate/independent company owned by EDFI) will be built to deliver US gas to the plant. Expected Commercial Operation Date for Rio Bravo IV is April 2005.Rio Bravo IV, together with Rio Bravo III, will help provide reliable and environmentally sound additional power generation capacity to Mexico at a very competitive price. These projects will help CFE meet energy demand growth which historically has been growing at more than 2% p.a. above the annual GDP growth.IFC''s involvement will be very critical in view of: (i) the recent slowdown in the implementation of the Mexican Independent Power Producer (IPP) program; (ii) the large amount of long-term financing that needs to be mobilized for the project in a short period of time; and (iii) the sector''s regulatory uncertainty. IFC will also ensure that the project will be developed in an environmentally sustainable manner.