PETALING JAYA: Tenaga Nasional Bhd has awarded long-term contracts worth a combined US$537mil (RM2.3bil) to four local companies companies, including Malaysian Bulk Carriers Bhd, for shipment of coal from Indonesia.
“The long-term contract of affreightment (COA) allows TNB Fuel Service Sdn Bhd (TNBF) to diversify its freight contracts’ portfolio to 60% term COA, 20% spot contract and 20% long term COA, subject to market condition,” TNB said.
The companies that secured the deals are Malaysian Bulk Carriers for a 15-year contract valued at US$143.1mil, PNSL Bhd for two 10-year contracts valued at a combined US$194.4mil, Prima Shipping Sdn Bhd for a 10-year contract worth US$99mil, and Duta Marine Sdn Bhd for a 10-year contract worth US$100.5mil.
According to TNB, the long-term COA was planned for shipments of coal from Indonesia, as almost 60% of the coal procured by TNBF were from the country.
TNBF, which is the nominated coal and fuel supplier to TNB and local independent power producers that have power purchase agreements with TNB, would then send the imported coal from Indonesia to three discharge ports, namely Lekir Bulk Terminal in Manjung, Perak, Jimah Power Plant in Negri Sembilan and Tanjung Bin Power Plant in Johor.
“As the long-term COA commences, the total allocated 7.5 million tonne per annum (mtpa) is actually less than 30% of the total shipping services required by TNBF in 2016, that is, 27 mtpa.
“By 2019, when the coal requirement is anticipated to be around 40 mtpa, the long-term COA will contribute to about 18.75% of the total shipping services,” TNB said.