Yinson bags RM1.5b solar PV project in India
04 Mar 2021
Yinson Holdings Bhd’s indirect 80%-owned unit, Rising Sun Energy (K) Pte Ltd (RSEK), will develop a 190MW grid-connected solar photovoltaic (PV) power project at the Nokh Solar Park in Rajasthan, India, for NTPC Ltd worth RM1.5 billion.
The plant will be 30km away from Yinson’s existing 140MW Bhadla projects, which are currently operated by its 95%-owned subsidiary Rising Sun Energy Pte Ltd.
Following a letter of award (LoA), Yinson stated that RSEK will enter into a power purchase agreement (PPA) to supply 25 years of solar power-generated electricity to NTPC. The estimated aggregate value of the contract based on a fixed tariff of 2.25 Indian rupee/kWh is equivalent to 27.5 billion Indian rupee (RM1.5 billion), subject to the terms and conditions of the LoA and PPA to be executed, Yinson noted in a release yesterday.
Commercial operation of the plant is scheduled to commence in April 2022.
“Any extension of the PPA period beyond 25 years shall be through mutual agreement between NTPC and RSEK. The LoA represents a formal agreement and constitutes a binding document between the parties pending the execution of the PPA. “The PPA is expected to be executed after certain process formalities have been completed between the parties,” the company added. Risks affecting the contract include project execution risk such as schedule slippage and costs overrun.
It also includes operational execution risks such as being able to carry out timely maintenance of the plant to deliver the required level of power generation to NTPC. Yinson added that regulatory risks relate to compliance of all safety and environmental rules and regulations required by NTPC and relevant authorities.
Yinson’s shares closed up 0.38% at RM5.30 yesterday, giving it a market capitalisation of RM5.83 billion.
The group’s net profit in the third quarter ended Oct 31, 2020 (3Q21), surged 86.8% year-on-year to RM100.7 million contributed by engineering, procurement, construction, installation and commissioning (EPCIC) business activities and lower loss on foreign exchange of RM12.7 million.
Revenue for 3Q21 surged to RM2.3 billion from RM240.9 million posted a year ago on the back of contribution from EPCIC business activities relating to floating production storage and offloading (FPSO) Anna Nery and FPSO Abigail Joseph.
Source: The Malaysian Reserve