Left: Petrojam boss Winston Watson says there is no decision yet on on how the deal will be structured. Right: Damian Obiglio, JPS president, says the plant is expected to supply 20 per cent of the power company's output. - File photos

Susan Gordon, Business Reporter

Petrojam and Jamaica Public Service Company Limited (JPS) are in early talks about a likely partnership on the construction of a 120-megawatt cogeneration plant at the refinery's Kingston base.

Sources tell Wednesday Business the plan would fall within a phase two programme under the ongoing $512 million refinery upgrade to end in 2012, and would be a supply source for both electricity and steam for JPS.

But according to Petrojam's Managing Director, Winston Watson, the discussions are in the very 'formative' stages, with no decision yet on the nature of the partnership and how costs associated with the project would be shared.

Petroleum Corporation of Jamaica consultant Dr. Raymond Wright said the cogeneration plant is to be run on petcoke produced by Petrojam, a byproduct of petroleum crude.

"This plant which is going to be built should supply 20 per cent of the total output on JPS," President and Chief Executive Officer, Damion Obiglio, told with Wednesday Business on the margins of the company's annual general meeting on May 31.

JPS has a generating capacity of 817MW, some of which is provided by contracted private power suppliers and cogeneration partners.

Watson was more reserved.

"It's an option we are looking into," he told Wednesday Business. "We are still looking into what is to be done."

Outlining tha the idea seems novel to Jamaica, Dr. Wright said the practice of using petcoke for the generation of electricity is done in other parts of the world.

Wednesday Business was unable to ascertain how much cheaper it is to use petcoke instead of petroleum, but understands that petcoke is generally 30 per cent cheaper than coal, the other solid fuel used to produce electricity.

susan.gordon@gleanerjm.com