Glow plans to spend B4bn on British firm's assets

SET-listed Glow Energy expects to invest about 4 billion baht to acquire assets of England-based Independent Power (IP) in Thailand and up to US$200 million to build a new 120-megawatt unit near its Huay Ho hydroelectric plant in Laos.

Chief financial officer Suthiwong Kongsiri said Paris-based GDF Suez, which holds 69% of Glow, has considered the sale of IP’s two power plants in Thailand because of a merger between the companies that will be completed early next year.

GDF Suez, which will become the world’s largest power producer after the merger, has decided to divest IP’s assets in Thailand by selling to Glow or other buyers.

IP operates a 150-MW power plant in Pluak Daeng, Rayong, near Glow’s power plant in Map Ta Phut, with another 110-MW unit under construction, Mr Suthiwong said.

“We would have to spend a maximum of 4 billion baht to acquire these two units next year. However, it is still uncertain whether the parent firm will sell to us if another company proposes a higher price,” he said.

Glow has studied an investment of $150-200 million to expand its Huay Ho power plant, which has operated for 10 years with a capacity of 150 MW. The new unit would be located 40 kilometres from the existing site.

“We have been in talks with Egat [Electricity Generating Authority of Thailand] about this project, which is expected to start construction in 2012 and be operated in 2015,” said Mr Suthiwong.

Glow has also been in discussions with Siam Cement Group (SCG) about developing a coal-fired power plant to serve SCG’s multi-billion-dollar petrochemical complex in southern Vietnam.

Following some delays, the first phase of SCG’s petrochemical joint venture is due to come on stream in 2014. Investment needed for the power plant depends on its size but coal-based units generally cost a minimum of $1.5 million per megawatt.

Locally, Glow has joined a new round of Small Power Producer bidding by proposing three gas-based plants to Egat with combined capacity of 240 MW. These projects will require spending of $100 million to $150 million.

Mr Suthiwong said Glow had studied the feasibility of building a 60-MW wind energy project in Chaiyaphum at a cost of about $120 million. It has developed a 1.5-MW solar unit as a pilot plant.

Source: http://www.bangkokpost.com/business/economics/208762/glow-plans-to-spend-b4bn-on-british-firm-assets