GIIG says it controls Bakun project now


  • Business
  • Saturday, 22 Nov 2003

BY ELAINE ANG

GULF International Investment Group (GIIG) Capital has confirmed that it is proceeding to take control of the Bakun hydroelectric power project through its proposed 60% stake in Sarawak Hidro Sdn Bhd. 

GIIG Capital vice-president of projects, Shahrir Shariff, said in a statement yesterday that the company was committing equity investment of RM945mil, representing 60% of the enlarged share capital of Sarawak Hidro. 

Shahrir confirmed that GIIG Capital had paid 10% of its total equity investment in Sarawak Hidro to the government – RM9.45mil on Aug 30 and RM85.05mil on Oct 13.  

“With the first payment of RM9.45mil paid to the Finance Ministry, a shareholders' and subscription agreement was signed, setting out the terms of participation. It also authorised GIIG Capital to conduct due diligence studies on the project. 

“Upon completion of the due diligence studies, the balance 10% equity payment of RM85.05mil was submitted to the Finance Ministry with the project documentation confirming our equity participation in the Bakun project,” he said, adding that as an equity investor, the company had satisfied the pre-conditions precedent to its participation. 

Shahrir said steps were being taken to proceed with the site purchase for the RM7.6bil aluminium smelter in Similajau, Sarawak, of which GIIG would be the principal driver. 

“Sarawak Hidro requires a concession agreement, setting out the terms of the concession, permitting it to make applications for approvals, permits and statutory licences,” he said, adding that the concession agreement would also permit Sarawak Hidro to set out project parameters, establish risk provisions and provide for remedies. 

Shahrir said once the terms of the concession agreement were defined and formalised, the next step would include the formalisation of the statutory licences required under Sarawak state law. 

“Upon securing these licences Sarawak Hidro will be able to enter debt funding commitments, and permit the finalisation of power purchase and off-take agreements,” he said. 

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