Preferred bidder for JPS power plant initiates possible bankruptcy proceedings

Abengoa, the Spanish company selected as the preferred bidder to build a major power plant in Jamaica, has initiated steps that could lead to a bankruptcy declaration. 

The filing for 'preliminary creditor protection', is an initial step that could lead to the largest bankruptcy case in Spain's history, the US-based Wall Street Journal reports.

It's reported that discussions started with creditors after another Spanish investment firm Gonvarri Corporación Financiera, cancelled a plan to inject around US$372.9 million into Abengoa.

Abengoa is a multinational corporation, which includes companies in energy, telecommunications, transportation, and the environment.

It is one of the world’s top builders of power lines transporting energy across Latin America.

Last week, the Jamaica Public Service Company Limited (JPS) announced Abengoa as the preferred bidder to build the 190 megawatt Combined Cycle plant in Old Harbour, St Catherine.

READ: JPS announces preferred bidder for Old Harbour Plant

The announcement followed the approval by the Electricity Sector Enterprise Team for the company to start negotiations with US-based New Fortress Energy for the supply of natural gas to the plant.

The JPS says once contracted, Abengoa will be responsible for the design, engineering and construction work on the plant.