Thailand's EGCO in Hydro Deal with Malaysians

Thailand's Electricity Generating Plc (Egco) will forge a joint venture with a Malaysian engineering construction company to develop the Nam Theun 1 hydropower project in Laos.

Egco already holds a 25 percent stake in the Nam Theun 2 project and the new venture is part of a strategy to consistently raise the SET-listed company's power generating capacity by 10 percent annually, according to president Visit Akaravinak.

Visit said Egco had signed an agreement with Gamuda Bhd, which holds the concession to develop the 450-megawatt Nam Theun 1 hydropower project located in central Laos.

"Gamuda approached us about being a partner in the project because of our strong expertise in electricity generation and work on the Nam Theun 2 project which is located on the same river as this project, and it looks like a good proposition to us," he said.

He explained that the joint venture would initially be a 50:50 arrangement and that a feasibility study would be conducted to determine the investment cost, which is expected to be half that of the 1.3 billion U.S. dollars estimated for the 1,070- Megawatt Nam Theun 2 project.

He also said the project partners would negotiate with Egat Plc about purchasing electricity from the project. Egat holds a 25.41 percent stake in Egco.

The Nam Theun 1 project is covered by an inter-government agreement for Thailand to purchase 3,300 mw of power from Laos.

It entails the construction of a 177- metre-high dam on the lower reaches of the Nam Kading river, requiring three million cubic metres of concrete, and a hydropower generating unit that will supply 2,000 GWh (gigawatt/hours) of hydroelectric power to Egat. (Bangkok Post, Oct. 17, 2005)