UK-based power generator Rurelec has agreed with Independent Power Corporation (IPC) to buy 50% stake in Central Illapa, a Chilean firm developing a 250MW gas-fired peaking plant in the Mejillones city.

An international mining group has shortlisted Central Illapa in a tender to provide 500MW of power to their operations in northern Chile.

If a power purchase agreement is awarded then Rurelec will build, own and operate the LNG-fired combined cycle gas turbine (CCGT) plant operating in tandem with the 250MW Illapa peaking facility.

Both IPC and Rurelec have been short-listed for another 500MW CCGT project to be built in northern Chile. The plant will run on LNG with capacity to be contracted to another mining company.

"Rurelec is acquiring the shares in Central Illapa for zero premium and refunding a portion of its third party project costs to date," a company statement noted.