EGAT signs power purchasing deal with Nam Theun II Power Co

Nov 11, 2003 01:00 AM

After a long delay, Thailand's state-run Electricity Generating Authority of Thailand (EGAT) signed a power purchase agreement with Laos' Nam Theun II Power Co to buy 995 MW from the planning giant power project over 25 years. Under the deal, starting in 2009, EGAT will pay 1.64 baht ($ 0.04) a kWh for the output from the Nam Theun II project, which has a capacity of 1,070 MW and can deliver 5,636 mm units of electricity to EGAT annually.
EGAT Governor Sitthiporn Rattanopas was quoted as saying that the purchase of power from Nam Theun II, the biggest power project in Indochina region, is outstanding as it will enhance the progress of the Association of Southeast Asian Nations (ASEAN) Power Grid and further reinforce the power systems of all ASEAN member countries. He added the project will also benefit both countries substantially.

For Thailand, the power from this environmentally clean project will be delivered at a reasonable price and will help to boost the power supply for the north-eastern region, where the demand for electricity rises continually.
Meanwhile, the purchase will contribute $ 230 mm a year to Laos. The signing was originally scheduled for July 18, but Electricite de France, the major shareholder with a 35 % stake, abruptly announced it was pulling out. After intense negotiations between Laos and France, the French utility finally agreed to stay on.

The joint venture partners of Nam Theun II are EGAT affiliate Electricity Generating (25 %), Electricity de France (35 %), Laos government (25 %) and Italian-Thai Development (15 %). The purchase also paved way for an agreement with the World Bank over loan guarantees.
The World Bank has not made its decision since it was not yet satisfied with the project's resettlement program and environmental protection plan. It is also waiting for the purchasing deal to go through. The primary construction work of the $ 1.2 bn dam is scheduled to begin next year and go into full commercial operation in 2008.

Source: Xinhua English Newswire
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