Mitsubishi Corporation

Press Room

September 26, 2012

Signing of Power Purchase Agreement for New IPP Project in Jordan

Mitsubishi Corporation (head office: Tokyo, “MC”), together with Korea Electric Power Corporation (head office: Seoul, “KEPCO”) and Wärtsilä Development & Financial Services Oy (head office: Helsinki, “WDFS”), has signed a 25-year long-term power purchase agreement (“PPA”) with National Electric Power Company (“NEPCO”) of the Hashemite Kingdom of Jordan (“Jordan”).
 
The KEPCO-MC-WDFS consortium was awarded the project following an international tender issued by NEPCO last year. The consortium will construct and operate a diesel engine power plant in the eastern part of Amman, the capital of Jordan (about 30km from the center of the city), , at a total project cost of approximately US$800 million. The maximum output of the power plant will be 600MW, making it the largest reciprocating engine technology power plant in the world, and is expected to commence electricity sale in 2014.  
 
Facing a growing electricity demand of 4-10% per annum due to steady economic growth, the Government of Jordan enacted a new electricity law in 2002 to enhance electricity generation capacity by promoting the privatization of electric power and the implementation of Independent Power Producer (IPP) projects. This is the third IPP project since the enactment of the new electricity law. Whilst the first and second IPP projects are gas fired, this third IPP project will run on heavy fuel oil or natural gas as a means of contributing to the diversification of the country’s fuel sources.
 
Under its Midterm Corporate Strategy 2012 which was announced in July 2010, MC has designated global environment business as a strategic domain and is actively promoting the power generation business, including renewable energy. MC is aiming to expand its power generation capacity from the current operational level of 4.5 GW to 6GW (with 1GW coming from renewable energy sources and 5GW from thermal power) by 2015.
 
【Project Location】


 
〔Reference〕
1. Jordan IPP3 Power Project
(1) Total Project Cost           : approximately US$800 Million
(2) Total Output                   : approximately 600MW
(3) Shareholders                  : KEPCO 60%, MC 35%, WDFS 5%
(4) Electricity Buyer             : NEPCO
(5) Start of Generation         : February 2014
 
2.Korea Electric Power Corporation
(1) Head office                   : Seoul, Korea
(2) Year of establishment     : 1982
(3) Business                        : Transmission and distribution of electricity in Korea, holding of domestic generation subsidiaries, and development and operation of overseas power plants.
(4) Sales                             : USD 37.6 billion (2011)
(5) Number of employees : 19,623 (as of December 2011)
(6) Representative               : Kim Joong-Kyum,
 
3. Wärtsilä Development & Financial Services Oy
(1) Head office                    : Helsinki, Finland
(2) Business                        : Development of IPP projects based on Wärtsilä engines (the total capacity of projects developed by. WDFS: 3GW).
(3)Remarks                        : Wholly-owned Subsidiary of Wärtsilä Corporation, Finland
 
4. Mitsubishi Corporation
(1) Head office                    : 3-1, Marunouchi 2-Chome, Chiyoda-ku, Tokyo, 100-8086, Japan
(2) Year of establishment     : 1950
(3) Capital                           : JPY 204 billion
(4) Main business activities : Mitsubishi Corporation (MC) is a global integrated business enterprise that develops and operates businesses across virtually every industry including industrial finance, energy, metals, machinery, chemicals, foods, and environmental business. MC's current activities are expanding far beyond its traditional trading operations as its diverse business ranges from natural resources development to investment in retail business, infrastructure, financial products and manufacturing of industrial goods.
(5) Sales                             : JPY20,126 billion
(6) Number of employees    : 63,058 (as of March 31, 2012)
(7) Representative               : Ken Kobayashi, President and Chief Executive Officer
 
5. National Electric Power Company
(1) Head office                   : Amman, Jordan
(2) Year of establishment     : 1996
(3) Business                        : Operation of the transmission network and the dispatch centers.
(4) Sales                             : JD 636 million (2009)
(5) Number of employees : 1,345 (as of December 2010)
(6) Representative               : Dr. Ghaleb Ma’abreh, Managing Director

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