PETALING JAYA: Cypark Resources Bhd will submit its bid for the largest solar energy capacity allowed for each player under the RM2bil large-scale solar three (LSS3) scheme, a move that is expected to contribute an annual revenue of RM50mil to RM60mil if the group qualifies for the tender.
According to Cypark group chief executive officer Datuk Daud Ahmad, the company plans to bid for a capacity of 100 megawatt (MW) under LSS3. Cypark is in the final stages of finalising its bid prior to submission.
He said the potential revenue from the LSS3 project would be “a significant boost” to the group’s future topline. For context, Cypark recorded a total revenue of RM337.88mil in the financial year ended Oct 31, 2018.
“As the renewable energy (RE) leader in Malaysia, Cypark considers itself the cost leader in the RE segment. We are also well-positioned to successfully tender for the RE project.
“Under the LSS1 and LSS2, we have a good success rate. We believe that if we continue with our efforts to make our costs competitive, we are confident that our chance to secure the project would be higher,” Daud told reporters after Cypark’s AGM here yesterday.
Cypark had won two solar farm projects under the previous LSS1 scheme and they are currently under construction. Under the second round of the LSS scheme, the company had clinched three more projects.
Earlier this year, it was reported that the competitive bidding process for LSS3 would be open for a six-month period until August. Under the LSS3 scheme, the government will tender out a solar energy capacity of between one MW and 100MW, with a target aggregate capacity of 500MW in Peninsular Malaysia.
The projects are in addition to ongoing LSS projects to produce 958MW of electricity between the end of this year and 2020.
On the status of Cypark’s waste-to-energy (WTE) plant, Daud said it is expected to be completed and commissioned in June this year.“The WTE plant will start contributing to our revenue from June upon completion. On a full-year basis, we are expecting about RM80mil in revenue from the plant.
“We have spent about RM500mil for the development of the WTE plant. It will be an important component of our business since it will deliver a stable recurring income for the group,” he said.
Cypark’s WTE plant, which is located in Ladang Tanah Merah, Negri Sembilan, is the first of its kind in Malaysia.
This facility will be able to produce 25MW of power from handling solid waste disposal and has the ability to increase capacity in the future.
“Our plant uses one of the world’s best technologies in the WTE scene. In fact, the technology is provided by Hitachi Zosen, which has built the most number of WTE plants in the world,” he said.
Moving forward, Daud remained optimistic that Cypark would be able to continue recording double-digit revenue growth, given the government’s increased push for RE initiatives. The company’s RE business segment is expected to become the dominant revenue contributor.
Currently, Cypark’s order book is valued at about RM600mil, with most of the contracts from the group’s environment engineering segment. Tender book-wise, Daud said the company has bid for over RM1bil in contract value and more than 90% of the projects are based in Malaysia.