Tenaga Nasional Bhd (TNB) does not expect to incur more than what has been accounted for after a dispute with Swiss investment bank UBS AG was settled out of court, said the company's chairman Datuk Awang Adek Hussain.
He said the amount TNB would pay to UBS to settle the dispute was less than the US$86.94mil it was sued for.
There will be no new financial impact, none that we have not taken into account,'' he said at a press conference in Kuala Lumpur yesterday.
Awang Adek, who declined to reveal details of the settlement, said terms were being kept confidential to avoid being manipulated by certain groups.''
Everyone is happy and we want to put this behind us and move forward, do better things than fighting each other in court.''
TNB through its lawyers released a statement late Thursday announcing that the dispute with UBS was resolved to their mutual satisfaction and, as a result, the High Court proceedings in London had been concluded.
UBS had sued TNB for US$86.94mil after the company terminated an options agreement that had been part of a US$500mil bond issued in 1997. TNB counter sued UBS for gross negligence and wilful misrepresentation.''
Meanwhile, Awang Adek said power consumption rose 7% for the first half to February due to hot weather. He expects growth in power consumption to reach 6% for the year to August 31. Demand is growing very well even during the SARS period. We had a new peak in June,'' he said.
Awang Adek was not too concerned over TNB's reserve margin of 40% compared with the industry average of 30%. With economic activity expected to pick up in the second half of this year, he sees the excess being absorbed quickly.
On the sale of its Kapar plant, Awang Adek was hopeful it would be concluded in October as the finer details were being finalised.
Yesterday, TNB took over the RM1.6bil 500kV transmission system phase 1 and 1A from Technology Transmission Sdn Bhd, a subsidiary of Malaysian Resources Corporation Bhd (MRCB).
Awang Adek said the 500kV transmission system was a critical infrastructure that would ensure reliable supply of electricity throughout the country.
The 500kV grid would eventually be connected to Thailand, Indonesia, Sabah, Sarawak and the Philippines as part of the Asean Power Grid.
With the grid, Awang Adek was hopeful there would be export of energy to Malaysia's neighbours. He disclosed that there were several inquiries via third parties but said the proposals were broad.
MRCB chairman Datuk Seri Syed Anwar Jamalullail said the company was now venturing into the international energy market.
(Our) expertise in the energy sector is a stepping stone to securing projects from overseas markets.''