TNB, Widad to build 2,100MW power plant in Selangor
21 Oct 2022
Tenaga Nasional Bhd (TNB) has received a letter of Intent (LoI) from the Ministry of Energy and Natural Resources for the development of a 2,100 megawatt (mw) combined cycle power plant project in Kapar, Selangor.
The LoI was received through its wholly-owned subsidiary TNB Power Generation Sdn Bhd (TPGSB).
In a filing with Bursa Malaysia today, TNB said the greenfield project will be constructed on TPGSB’s own land located north of the existing Sultan Salahuddin Abdul Aziz Power Station and will be carried out in collaboration with Widad Business Group Sdn Bhd (WBG).
The project is scheduled for a commercial operation date in 2031.
“The project is aligned with TNB’s Net Zero Emissions Aspiration by 2050, which also forms part of TPGSB’s initiative in supporting the government’s Low Carbon Aspiration 2040 under the National Energy Policy and the government’s commitment to achieving carbon neutrality by 2050,” TNB said.
The power plant is also expected to be earnings accretive to TNB upon commissioning of the project.
“This project will not have any material effect on TNB’s consolidated net assets per share prior to commissioning.
“The transaction will not have any effect on the issued and paid-up share capital and the substantial shareholders’ shareholdings of TNB,” it said.
In a separate statement, TNB president and chief executive officer Datuk Baharin Din said the project has an estimated investment of RM9.5 billion and is projected to deliver earnings before interest and tax of approximately RM400 million per annum.
“We are also looking at embracing new green technologies where new gas-fired power plants will be developed with future hydrogen technology as alternate fuel to gas,” he said.
WBG founder and group executive chairman Tan Sri Muhammad Ikmal Opat Abdullah (pix) said the project would be carried out through a joint venture between TNB and WBG with the former holding a 60 per cent stake and the latter holding a 40 per cent stake.
In another development, Master Tec Wire and Cable Sdn Bhd will be supplying low-voltage power cables to TNB wholly-owned subsidiary, Tenaga Cable Industries Sdn Bhd, worth RM12 million following their long-term original equipment manufacturing agreement.
The volume of low-voltage cables to be supplied over the next one year would depend on the demand from Tenaga Cable Industries, it said in a statement today.
“Given our experience in supplying necessary cables for renewable energy (RE) facilities, Master Tec Wire and Cable is also well-positioned to capture more opportunities in the segment as the government accelerates its efforts to achieve carbon neutrality by 2050,” director Datuk Lau Kim San said.