Page 12 - AsiaElec Week 10

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NEWS IN BRIEF
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GENERATION
China’s CNOOC to inject struggling gas, power unit into listed upstream business
CNOOC is set to inject its struggling natural gas terminal and power unit into its flagship listed vehicle CNOOC Ltd, Reuters reported.
The plan for the internal merger, first looked into a year ago by top management at China’s third-biggest energy major, has been revived given sharp losses last year at the unit’s gas trading division and a government- mandated industry reshuffle that will anyway absorb some of its terminal assets.
While the merger could help raise the proportion of cleaner-burning gas in CNOOC Ltd’s output portfolio and improve its “green” profile, similar to global peers like Shell and Total, the deal is likely to struggle to attract investors given the steep losses at the gas and power unit.
“Shareholders may have welcomed it in 2017 or 2018 when China’s gas demand soared and terminal business was robust,” said an equity analyst with a western bank who tracks
CNOOC Ltd.
But the timing is wrong now because of the
unit’s big trading losses,” the analyst added. CNOOC said it does not comment on
market speculation, while a top executive at the gas and power unit declined to comment.
But, one source, who advises CNOOC on strategic matters, described the plan as “group level strategy”, although all three sources said there was no specific timeline for the deal yet.
“Apart from internal synergy ... an extension into the mid-and-downstream gas business can be a trendy topic in the capital markets as investors increasingly favour a ‘green’ energy firm,” a second senior source said.
COAL
Shanghai Electric achieves financial close on large- scale coal project in Pakistan
Shanghai Electric Group, a global manufacturer and supplier of power generation and industrial equipment, has achieved financial close for the coal project
out of the Thar Block-1 Integrated Coal Mine Power Project in Pakistan.
The Thar coalfield is the largest in Asia, holding an estimated 175bn tonnes of lignite resource and covering an area of over 9,000 square km in the Thar Desert, southeast of Pakistan’s Sindh Province.
The mine has an annual production capacity of 7.8mn tonnes and features two 660MW coal-fired power plants. The project is capable of powering 4mn households
in Pakistan with 1320MW of indigenous, affordable and reliable electricity.
The project was developed under the umbrella of the China-Pakistan Economic Corridor and forms part of efforts by the Government of Pakistan to achieve energy security and reduce the average cost of power generation by moving from oil to coal.
The project is currently employing over 908 local workers and is expected to play an essential role in the social development of the region, with Shanghai Electric pledging to be an active and enthusiastic force in development efforts that help the local Thar community.
“We are proud to help bring the country its first large-scale, local coal-based electricity project. We are also grateful to the local government for their support,” said Mr. Qian Xiaolei, PR manager of Thar Coal Block-1 Power Generation Company (PVT) Ltd (SPV of Shanghai Electric in Pakistan).
Shanghai Electric has already begun
the construction of power plants in the Thar Coalfield. The Company will deliver ultra-supercritical technology, which can run at higher net efficiency than the annual average net efficiency required by Pakistani government.
Additionally, the plants will operate with a high Acid Gas removal rate, with low sulphur dioxide emissions to reduce environmental impact when it begins to generate electricity in 2022.
INVESTMENT
Thailand’s BCPG aims for growth
SET-listed BCPG Plc, the renewable power arm of Bangchak Corporation, has earmarked 45bn baht in 2020 capital expenditure to expand its business over the next four years.
President and chief executive Bundit Sapianchai said areas for investment in renewable power plants include Asean and Japan, where renewable energy demand is on the rise.
Those projects will be both new developments, capacity expansions and takeover deals.
The investments are expected to grow
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Week 10 11•March•2020