SET-listed Gulf Energy Development Plc is upbeat about two gas-fired power plants after inking a 400-million-baht contract for engineering services agreements with the Electricity Generating Authority of Thailand (Egat).
Gulf president Porntipa Chinvetkitvanit said the company signed two field services agreements with Egat to prepare development of two large power plants, effective from December 2018 to October 2022.
"Egat will oversee construction of two independent power producer (IPP) projects because Egat has a team with specialised expertise in power plant construction," she said.
The move comes after Gulf won the third-round auction for two IPP licences from the Energy Ministry in mid-2013 for a total capacity of five gigawatts.
The development period was delayed due to the economic slowdown and political turmoil in 2014, and Gulf has been waiting for an appropriate time.
The two locations for the plants are Chon Buri and Rayong, with a capacity of 2.5GW each, and Gulf has been readying project finance since early 2018.
In Chon Buri, Gulf SRC Co will run the power plant in Sri Racha district. In Rayong, Gulf PD Co will handle the plant in Pluak Daeng district.
The two companies are Gulf subsidiaries.
Egat governor Viboon Rerksirathai noted that the two projects are in the eastern region, where electricity demand is growing as a result of the government's policy to develop the country's industrial sector with the Eastern Economic Corridor and the Thailand 4.0 initiative.
Once the two projects commence commercial operation around 2024-25, Gulf will have the largest IPP capacity, surpassing two other SET-listed companies: Ratchaburi Electricity Generating Holding Plc (Ratch) and Electricity Generating Plc (Egco), both of which have Egat as a major shareholder.
Gulf ranks third among Thailand's top five largest power generators with 5.3GW. Egat is the largest with a capacity of 16.01GW, Ratch is second with 8.02GW, and Egco has a capacity of 4.26GW.
In a related development, Gulf submitted a letter to the Stock Exchange of Thailand on Thursday saying its board had passed a resolution to establish a new subsidiary, Gulf Energy Mauritius Co, in Mauritius with registered capital of US$100,000 and Gulf as the sole owner.
The subsidiary has been established as a holding company investing in energy and other related business, as well as facilitating financial arrangements for subsidiaries, joint ventures and other companies under the group.
GULF shares closed yesterday on the SET at 70.50 baht, up one baht, in trade worth 2.85 billion baht.
