BUSINESS
The UK utility PowerGen has invested $62 million for a 49.9 per cent stake in the South Korean private sector power company LG Energy Co. LG Energy is developing a gas fired combined cycle power plant 120 km from Seoul. The 528 MWe development will cost $352 million to complete.
The plant is expected to start generating power in July 2000, when PowerGen predicts it will be the first of four scheduled IPPs in the country to start delivering electricity.
The project is being financed through an equity stake of 31 per cent and a debt burden of 69 per cent. PowerGen will guarantee around $150 million while commercial negotiations are concluded, sometime within the next 12 months.
South Korea is expected to enter a new round of bidding for IPP projects next year. There are plans for a total IPP generating capacity of 5.5 GWe by 2010. Current installed generating capacity in the country is 43 GWe.