Cost of Kemper plant dropped $1.8 million in May

meperez@sunherald.comJuly 1, 2014 

Mississippi Power reported in its monthly filing to the Public Service Commission on Tuesday the total cost of the Kemper County lignite plant dropped by $1.8 million in May and the plant remains on target to begin commercial operation in the first half of 2015.

An 8-K report also was filed with the Securities and Exchange Commission.

Savings came from the categories of startup fuel and energy costs and scheduled risk costs, which more than offset increases in contingency and other areas.

The total cost remains at $5.55 billion, with a cap of more than $4.4 billion imposed by the PSC and a $1.56 billion loss to covered by Southern Company, parent company of Mississippi Power.

The original projected cost for the plant and lignite mine was of $2.8 billion.

Several milestones were reached in the construction of the plant in the last two months, said Natalie Campen, media relations manager for Mississippi Power.

The purchase of the site is completed, along with construction of the nitrogen plant, water plant, water storage lake, administrative and electrical buildings and the lignite storage dome. The development costs of the mine through May were $229.6 million, less than the $235 million estimated cost at this point.

"Lignite is being successfully mined and readied for use in the Kemper gasifiers when the facility begins commercial operation," Campen said.

Another sign of progress is the successful completion pneumatic tests on gasifiers to look for leaks and to see if the gasifiers can take the pressure.

This is an important step before the next milestone, said Campen, which is the gasifier heat-up later this summer.

The company also reported 1,105 construction jobs on the project in May. About 45 of the 508 Mississippi companies that have worked on the Kemper plant are from South Mississippi.

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