BPZ Energy Awards EPC Contract For Its Peru Power Plant
Provides Operations Update for Z-1 Block Development
Houston, TX — BPZ Energy, Inc. announced today that it has awarded the turnkey contract for the engineering, procurement and construction (EPC) of its power plant project in northwest Peru to BTEC Turbines LP of Houston. The contract was awarded following a comprehensive six-month bidding process that included field visits by all of the bidders. Under the EPC contract, the final terms of which are being negotiated, BTEC will supply two General Electric Frame 7 simple-cycle gas-fired turbines. BTEC will also act as the main contractor for the transportation of all equipment, construction, startup and commissioning of the power plant, which is to be located at Caleta Cruz, approximately 10 miles southwest of the city of Tumbes, Peru. First power generation from the BPZ Energy power plant is planned for July 2006.
The turnkey EPC contact calls for both turbines to be fully tested in the United States before being shipped to Peru in three major components for alignment and reassembly on site. BTEC's contract will also include a two- year maintenance and operations program, a ten-year service agreement for long-term maintenance and a one-year warranty on the equipment.
"Selecting the right contractor to handle the EPC contract for our power plant project is a critical step in keeping the project on schedule and on budget to produce power by mid-next year," stated Manolo Zuniga, President and Chief Executive Officer of BPZ Energy, Inc. "We are impressed with BTEC's reputation for providing superior turnkey services. We also like the operating flexibility and redundancy of using two smaller turbines versus one large unit to generate electricity. The General Electric Frame 7 units are known to be workhorse machines that are simple to operate and maintain," continued Mr. Zuniga.
Operations Update
BPZ has also made significant progress this summer on the engineering and
construction projects necessary to develop, produce and transport gas from the
Z-1 Block, located 10 miles offshore from the power plant in northwest Peru.
In May 2005, the Company received the required environmental permit from the Ministry of Energy and Mines in Peru to refurbish the CX-11X platform at the Corvina Field in the Z-1 Block. The platform refurbishment program is underway and is expected to be completed by year-end. In addition, BPZ Energy has identified several drilling rigs and contractors with experience working in the area and is currently negotiating to secure a rig for its drilling program. The drilling plan will rehabilitate and test the currently shut-in C-16X well and anticipates the drilling of six new wells in the Corvina Field.
BPZ Energy has awarded the front end engineering and design contract for the Corvina gas field development project to Upstream Engineering LLC, a Houston-based engineering firm which specializes in the design of platforms, production facilities and pipelines. Under the terms of the contract, Upstream Engineering is designing offshore and onshore gas processing facilities capable of handling up to 200 MMCF/D of gas from BPZ Energy's offshore gas fields in its initial phase. They are also designing the 10 mile offshore pipeline to deliver gas to the BPZ Energy power plant as well as the 40 mile onshore pipeline dedicated to delivering gas for third party sales at the city of Arenillas, Ecuador.
Upstream Engineering has already completed a preliminary engineering study that confirmed the previously held cost estimates for the project as well as the timeline for first gas production, currently scheduled for July 2006. Procurement and construction are expected to commence in September 2005. Upstream Engineering's reputation and experience is renowned worldwide through participation in projects in the Gulf of Mexico, West Africa, Mexico, and South America.
SOURCE: BPZ Energy, Inc.