8 December 2003
Wednesday September 10, 17:38 PM
INTERVIEW: By Irene Kwek
Of DOW JONES NEWSWIRES
BANGKOK (Dow Jones)
Electricite de France (F.EDF), or EdF, may retain a stake in the US$1.2 billion Nam Theun 2 hydropower project in Laos, even though it announced two months ago it was pulling out of the project.
According to members of the developing consortium, EdF will decide by the end of this month on the extent of its involvement.
"EdF will have to decide at what level they will stay in the project by the end of September," said Viraphonh Viravong, General Manager of Electricite du Laos, in an interview with Dow Jones Newswires.
"EdF said they will withdraw from the project, but after talks it is decided they will stay but reduce their share in the project," he said.
In July, EdF said it was backing out of the planned 1,070-megawatt project. EdF's unit, EDF International is the largest shareholder in the consortium formed to develop the dam and power plant.
The announcement threw the project into doubt as Thailand said it would wait only one more year to sign a deal to buy power from the long-delayed project before looking elsewhere.
Edf holds a 35% stake in the project. Thailand's Electricity Generating PCL (H.EGA), or EGCO, and state-owned Electricite du Laos each hold 25% stakes and Italian-Thai Development PCL (H.ITD) holds the remaining 15%.
Another member of the developing consortium also confirmed that EdF was revising its position and would possibly remain in the project.
"Initially they said they will decide by the end of this month, but we hope they will decide before the end of the month," he said.
Statkraft A Potential Investor
Investors from Japan, Norway and China have expressed interest in buying into the project, members of the consortium say.
The new shareholders of the project will likely be finalized by the end of this year, Viraphonh said.
One potential investor is Norway's Statkraft (Y.SKT), which is no stranger to investing in Laos power projects. Statkraft holds a 20% stake in Laos' Theun Hinboun Power Co. through its ownership in Nordic Hydropower.
The 210-MW Nam Theun-Hinboun Hydropower Project was completed in 1998. The power is exported to Thailand.
Going forward, the construction schedule will hinge on the signing of the power purchase agreement.
"There should be no real delay in the project as long as we can finalize the shareholders this year," Viraphonh said.
Preliminary works had been expected to start in this year's dry season in October and November, but this is likely to be delayed till the next dry season in October 2004, he said.
Commercial operations of the Nam Theun project are targeted for 72 months after the signing of the power purchase agreement, said another member of the developer's consortium.
Thailand will buy most of the electricity produced by the Nam Theun project.
The power purchase arrangement is critical to the Nam Theun 2 project as it will be used as collateral to secure loan facilities from the World Bank and other financiers.
Of the total investment cost, US$900 million will be acquired from commercial bank loans and the remainder from shareholders' equity.
http://asia.news.yahoo.com/030910/5/147bv.html