KUCHING: Installation of turbine is currently under way for Sarawak Cable Bhd’s (SCB) first 10MW hydro power plant project in north Sumatra, Indonesia.
According to SCB group managing director and chief executive officer Aaron Toh Chee Ching, the power plant would be commissioned in June by the latest.
He said due to the time taken in rock blasting works for the construction of the dam’s power house, this had caused some delays in the commercial operation of the project.
The dam, which costs about RM80mil to build, was earlier slated to come on stream early this year.
Under a power purchase agreement (PPA), SCB’s 78%-owned Indonesian unit PT Inpola Mitra Elektrindo (IME) will sell the electricity generated by the dam to Perusahaan Listrik Negara Persero (PLN), the Indonesian utility body, for 20 years. The concession is renewable.
Once commissioned, the power plant would provide a new stream of revenue for SCB, whose core business is in the manufacturing and sales of power and telecommunication cables, galvanised products and steel structures as well as construction of power transmission lines.
On SCB’s plan to invest in two more hydro power plant projects in Sumatra, Toh said that the proposed projects could only proceed upon the conclusion of PPA with PLN.
“We are still waiting for the PPA to be signed,” he told Metro Sarawak.
SCB is working with local Indonesian partners to jointly undertake the proposed new hydro dam projects, each of which will also have a generation capacity of 10MW. The proposed projects have been approved by the local authorities, and the proposed dams would be constructed along the Ordi River.
On SCB’s plans to sell its non-core businesses, including Aerial Power Line Sdn Bhd (APL), Toh said negotiations with a potential buyer were on-going. “We hope to close the deal by June,” he added.
APL, which was acquired by SCB as a dormant company in 2013, operates a fleet of three helicopters.
The company’s scope of services include power line surveillance,maintenance and repairs.
Meanwhile, SCB has recently received the green light of Bursa Securities for the listing and quotation of up to 31.7 million new shares to be issued under a private placement.
Based on an indicative price of RM1.70 per placement share, the exercise is expected to raise gross proceeds of RM53.9mil.
The proceeds, according to SCB, will be utilised to repay the group’s bank borrowings which stood at RM593mil as of Dec 31, 2015.
SCB group gearings increased substantially after it acquired Universal Cable (M) Bhd and Leader Cable Industry Bhd for RM210mil about 15 months ago. About RM110mil of the acquisition price was satisifed by cash and out of this amount, some 90% was via bank borrowings.
The acquisitions have boosted the group’s manufacturing facilities to eight plants in several states in peninsular Malaysia and Sarawak.
The positive contributions from Universal Cable and Leader Cable enabled SCB group’s sale of power and telecommunication cables soaring to RM760.5mil in the financial year ended Dec 31, 2015 from RM154.7mil in 2014 or a four-fold increase.