Guest guest Posted April 1, 2003 Report Share Posted April 1, 2003 This message was forwarded to you by yitzeling. Comment from sender: This article is from thestar.com.my URL: http://biz.thestar.com.my/news/story.asp?file=/2003/3/29/business/kpbakun & sec=bu\ siness ________________________ Saturday, March 29, 2003 Bakun in major power sale deal BY K.P. LEE in Putrajaya THE Bakun Hydroelectric dam project would be selling more than a third of its 2,400-MW power generating capacity to the massive US$2bil aluminium smelting plant near Bintulu, under the terms of a memorandum of understanding (MoU) signed yesterday. Second Finance Minister Datuk Jamaludin Jarjis, who witnessed the MoU signing in Putrajaya, described the event as “an important milestone” for the recently revived and controversial Bakun project, which is scheduled to begin commercial operations in the fourth quarter 2007. The MoU between government-owned Bakun developer Sarawak Hidro Sdn Bhd and Smelter Asia Sdn Bhd, a joint-venture company established by Middle East investors Dubai Aluminium Co Ltd (Dubal) and Gulf International Investment Group (GIIC) to develop the proposed aluminium plant, paves the way for a power purchase agreement for the supply of up to 900 MW of electricity to the plant by 2012. Dubal is a United Arab Emirates industrial giant and one of the world & #8217;s top aluminium producers. This investment represents its first major foray into the Far East. The Dubai government-owned company already has investments in Iran and Qatar, apart from its home base. The GIIC, meanwhile, is the Malaysian investment arm of several Gulf investors, consisting of individuals and organisations based principally in Dubai and Bahrain. Jamaludin said the significant investment by Dubal and GIIC demonstrated that Malaysia was still an attractive destination for foreign direct investment (FDI) despite the current geopolitical uncertainties, adding that yesterday's signing “reaffirmed their commitment” to this investment. He said the purchase price for the electricity had been determined, but declined to reveal the rates that had been agreed upon by the parties. “We have to be competitive?and they are pleased with the rates,” he said. Jamaludin also said the proposed plant would generate substantial downstream aluminium-related industries and benefit the country & #8217;s economic development in the long term. The aluminium smelter will be the single largest foreign investment in Sarawak and is expected to provide some 3,000 new jobs in the Bintulu area. Smelter Asia chairman Mohamed Ali Alabbar said the decision to select Malaysia was made against stiff competition from other countries and he had been encouraged by the good relationships established here. “We need a government and partner that welcomes and works with you,” said Alabbar, who is also the vice-chairman of Dubal. Alabbar said the proposed plant on a 250ha site in Similajau would supply the local as well as Far Eastern markets, such as Japan and China. He said he expected approximately 60% & #8211;65% of the plant & #8217;s eventual annual production of 500,000 tonnes of aluminium ingots to be exported. Malaysia's current annual demand for aluminium was 250,000 tonnes, he said. According to Smelter Asia, construction of the plant would begin by year's end and the first phase of production of 250,000 tonnes of aluminium ingots is targeted to start in 2005. The amount of electricity to be purchased under this phase would be 450 MW, increasing to 900 MW in phase 2, when production capacity is doubled to 500,000 tonnes in 2012. On environmental protection, the company said it was undertaking an Environmental Impact Assessment (EIA) study of the project. Alabbar said Smelter Asia planned to install the latest computerised control and fume treatment systems, which he said would be the safest in the world. Fears had recently been raised in Sarawak that the establishment of such a large aluminium plant could cause environmental damage. The Borneo Resources Institute, an environmental watchdog group, earlier told The Star that it was concerned that such “high risk” projects were not handled with sufficient environmental assessment. Alabbar stressed that the plant would employ the best health, safety and environmental practices from the very beginning, adding that its operations in Sarawak would be similar to its Dubai plant, located 2km from the city and where “we study the quality of our emissions on a daily basis.” On Malaysia's economy, Jamaludin said the government was studying the impact of various scenarios which could emerge from the war in Iraq and their implications for the global and local economies. He said these factors would be “in-built” in the measures to pump prime the economy, to be announced by the Prime Minister next month. The government would take a holistic view of the economy and look at a broad range of specific actions and strategies, he said. <p> ________________________ Your one-stop information portal: The Star Online http://thestar.com.my http://biz.thestar.com.my http://classifieds.thestar.com.my http://cards.thestar.com.my http://search.thestar.com.my http://star-motoring.com http://star-space.com http://star-jobs.com http://star-ecentral.com http://star-techcentral.com 1995-2002 Star Publications (Malaysia) Bhd. All rights reserved. Reproduction in whole or in part in any form or medium without express written permission of Star Publications is prohibited. Quote Link to comment Share on other sites More sharing options...
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