GULF and CDTO Sign MOU with EGAT for Pak Beng Hydroelectric Power Plant Project
Gulf Energy Development Public Company Limited has announced that it has signed a memorandum of understanding (MOU) with the Electricity Generating Authority of Thailand (EGAT) for the development of the Pak Beng Hydroelectric Power Plant Project. The project, with a capacity of 912 megawatts, will be located on the Mekong River in Laos and will generate and sell all electricity to EGAT. The agreement, which has a duration of 29 years, was signed by Pak Beng Power Company Limited, a joint venture between Gulf and China Datang Overseas Investment Co., Ltd. (CDTO).
The Pak Beng project has a total investment value of approximately 100,000 million baht and is currently in the process of acquiring loans with financial institutions. Construction is expected to take approximately 8 years, with commercial operation scheduled for 2033. The project has been approved by the government and the National Council of the Lao PDR and is part of the Memorandum of Understanding between Thailand and Laos on cooperation in electricity development. It aims to support the reduction of carbon emissions and increase the use of clean energy during the energy transition.
Under the MOU, Thailand will purchase electricity from power station projects in Laos and connect them through the international power transmission system. Currently, there are 11 projects supplying electricity to the system, with a total capacity of 5,935 megawatts. In addition, there are three projects that have signed power purchase agreements and two projects under a tariff MOU, bringing the total to 3,060 and 815 megawatts, respectively.
This cooperation aligns with Thailand’s government policy to increase the proportion of power plants from clean energy sources, replace decommissioned power plants, and meet the growing demand for electricity due to the rise in electric vehicles. Purchasing electricity from the Pak Beng project will help reduce fuel price fluctuations and provide low-cost electricity to households and industries throughout the contract period.
Moreover, the project will stimulate economic development and employment in Thailand by requiring the use of raw materials, products, and services from the country. As a hydroelectric power plant with a year-round water flow and no water storage, the Pak Beng project has minimal impact on the Mekong River’s water quantity and has received environmental and social impact approval from the Lao PDR government.
GULF or Gulf Energy Development Public Company Limited informed the Stock Exchange of Thailand on 25 April 2022 that the Company and CDTO (China Datang Overseas Investment Co., Ltd.) under the group China Datang Corporation Ltd., a flagship enterprise owned by the state and an energy company in China.
There are electricity generation projects with a total installed capacity of 170,000 megawatts covering 13 countries worldwide. signed a memorandum of understanding for the purchase of electricity (Tariff MOU) with the Electricity Generating Authority of Thailand (“EGAT”) to develop the Pak Beng Hydroelectric Power Plant Project (or Pak Beng Project) with an Installed generation capacity of 912 megawatts, located on the Mekong River, Muang Pakbeng, Oudomxay Province, Lao People’s Democratic Republic or Lao PDR, and will generate and sell all electricity generated to EGAT.
Most recently, on September 13, 2023, Pak Beng Power Company Limited, a joint venture between the Company and CDTO with shares of 49% and 51% respectively, operated the Pak Beng Project. By signing a power purchase agreement with EGAT, the contract has a period of 29 years.
From the day the electricity is supplied to the system and has an average electricity rate of 2.7129 baht per kilowatt-hour The Pak Beng project has a total investment value of about 100,000 million baht.Currently, it is the process of acquiring loans with financial institutions. It is expected to be acquired by the end of 2024 and will take approximately 8 years to build. Commercial operation is scheduled for 2033.
The Pak Beng project is a project that has been approved by the government and the National Council of the Lao PDR and has signed a concession contract with the Lao PDR government on 11 August 2023. It is considered one of the power plant projects of under the Memorandum of Understanding between Thailand and Lao PDR on cooperation in electricity development in Lao PDR (MOU) to support the reduction of carbon emissions. and increase the use of clean energy during the energy transition.
Under the Memorandum of Understanding, Thailand will purchase electricity from power station projects developed in Lao PDR and connect them through the international power transmission system.
Currently, there is a framework for cooperation in the purchase of electricity of 10,500 megawatts, 11 projects have supplied electricity to the system of 5,935 megawatts, 3 projects that have signed power purchase agreements of 3,060 megawatts, and projects that have signed a joint memorandum -understanding ■ Electricity purchase (Tariff MOU) has reached 815 megawatts for 2 projects.
Cooperation under the Memorandum of Understanding is in line with Thai government policy which focuses on increasing the proportion of power plants from clean energy sources that will enter the system. To replace decommissioning power plants, totaling more than tens of thousands of megawatts, from 2023 onwards, and also to meet the increasing demand for electricity in the future from the increase in electric vehicles (EVs) .
Buying electricity from the Pak Beng project will help reduce fuel price fluctuations. and help ease the burden of people in the household and industrial sectors by allowing them to use electricity at low prices throughout the contract period. This is because the project has an electricity generation cost that is lower than the current average electricity price of 4-5 baht per kilowatt-hour.
Furthermore, under the terms of the power purchase agreement. The project will require the use of raw materials and products in the construction of the power station. Including Employment personnel and services from Thailand This will help stimulate economic development and employment in the country. and according to the plan for purchasing electricity from neighboring countries as set out in the national electricity purchase plan.
The Pak Beng project is a hydroelectric power plant with year-round water flow. There is no water storage in the form of reservoir-like dams. and there is no diversion of water from the Mekong River. Therefore, it does not affect the amount of water in the Mekong River. The project received approval from the results of a study of environmental and social impacts, including the issue of sediment drainage through fish. Migration of communities in the project area and cross-border impacts by the Lao PDR government has been completed
Source: https://www.newsdirectory3.com/gulf-and-cdto-sign-mou-with-egat-for-pak-beng-hydroelectric-power-plant-project/
