Sempra starts rest of 1,250 MW Arizona powerplant
Wednesday November 12, 1:51 pm ET
SAN FRANCISCO, Nov 12 (Reuters) - Sempra Energy's power generation unit on Wednesday said the remaining 625 megawatts (MW) of power from its $500 million power plant in Arizona began commercial service today.
The power plant, Sempra Energy Resources' largest, will provide electricity to fast-growing cities throughout the U.S. Southwest. The first phase of the facility, consisting of 625 megawatts, started operating this summer.
Mike Niggli, president of Sempra Energy Resources, said about 85 percent of the power generated by the plant, about 40 miles (64 km) west of Phoenix, is under contracts running from three to five years.
The balance of the generation produced will be sold into wholesale markets. Gas for the power plant will be taken off El Paso Corp.'s big Southwest pipeline system and be bought on a day-ahead and month-ahead basis, Niggli said.
The power plant was financed through cash flow and not through debt or equity issuance, he added.
The 1,250 MW facility will use roughly 210 million cubic feet of gas per day.
Sempra's Arizona plant is part of a growing fleet of gas-fired plants in the Western United States that have triggered plans for a host of regional gas supply projects, including liquefied natural gas facilities in Mexico.
Some of those LNG projects in Mexico are planned to be built with adjacent pipelines that will extend into the United States where the gas will be used by power plants in California and the Southwest.
This past summer, Sempra Energy Resources completed 600 MW, wholly owned power plant near Mexicali, Baja California, Mexico, and a 550 MW, jointly owned facility near Bakersfield, California.
Dow Jones Business News
Sempra:1,250 MW Mesquite Plant in Ariz Fully Operational
Wednesday November 12, 1:33 pm ET
LOS ANGELES (Dow Jones)--Sempra Energy unit Sempra Energy Resources' 1, 250 megawatt, $500 million Mesquite Power Plant near Phoenix, Ariz. is now fully operational, said company spokesman Art Larson Wednesday.
The first of the Mesquite plant's two 625-megawatt units joined the grid in June 2003. The plant, the largest in Sempra Energy Resources' fleet, is about 40 miles west of Phoenix.
Mesquite is the third plant Sempra Energy Resources has finished building this year in the Southwest. The 600 MW Termoelectrica de Mexicali plant near Mexicali in Baja California, Mexico, and the 550 MW Elk Hills plant near Bakersfield, Calif., joined the grid this summer.
The three plants represent a combined investment exceeding $1 billion, the company said in a release.
All three natural gas-fired plants were completed on time and under budget, said Donald Felsinger, group president of Sempra Energy Global Enterprises, in a statement.
"The Pacific Southwest continues to grow and electricity produced by Mesquite Power will help fuel the region's expansion," said Michael Niggli, president of Sempra Energy Resources, in a statement.
Sempra Energy Resources has about 85% of all its generation hedged through 2005, and about 82% hedged through 2008, said Stephen Baum, Sempra's chairman, president and chief executive last week on a conference call with analysts.
With the addition of the final Mesquite unit, the generation subsidiary has more than 2,625 megawatts of electricity in operation currently. The company has a contract to provide up to 1,900 megawatts to California's power-buying agency, the Department of Water Resources.