Golar Power has made final investment decision for the proposed 1.5GW Porto de Sergipe combined cycle power plant project in Brazil.
The project company CELSE will now prepare to sign turn-key engineering and construction (EPC) agreement with General Electric (GE) to build, maintain and operate the combined cycle power plant near Aracaju, Sergipe.
The power station, which will supplement hydro power during dry seasons and meet growing regional demand for electricity, will be the largest thermal power station in South America upon completion, the company said.
Golar Power CEO Eduardo Antonello said: "The project shows very solid economics and provides a strong financial foundation for Golar Power.
“Through this project, Golar Power is developing a very robust and replicable structure to enable the most comprehensive, cost-efficient and flexible integrated gas-to-power solutions globally.
“We see a huge market to develop cheaper and cleaner energy solutions."
The power generated from the facility will be delivered to 26 committed offtakers for 25 years starting from 2025.
Golar Power has also signed an agreement to charter the Floating Storage Regasification Unit (FSRU) Golar Nanook for 25 years, starting from 2017.
Equally owned by Golar LNG and Stonepeak Infrastructure Partners, Golar Power will own 50% stake in the Sergipe project and 100% of the associated FSRU.
Golar Power expects the cost for the development of the power station and the terminal including taxes and financing costs to be $1.3bn.