Tuesday, August 04, 2020

BGRIM confident of coping with drought, rules out impact form global economy

Feb 07. 2020
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By The Nation

B Grimm Power Plc (BGRIM), a leading private power producer in Thailand, is confident of coping with the problems of drought by embracing international standards for water supply management in its electricity production.

The company did not expect any impact from fluctuations of the global economy, given its world-class customer base and continuous growth in new clients.

BGRIM CEO Preeyanart Soontornwata said: "We have closely monitored the drought situation and planned our water management strategy in coordination with industrial estate operators".

 BGRIM CEO Preeyanart Soontornwata

"We are confident of continuing production of high-quality electricity and steam to meet strong demand from existing customers and new clients".

She noted that BGRIM's cash flow remains stable for the long term as most of its revenue are derived from long-term power purchase agreements of up to 25 years with state utilities both at home and abroad.

Regarding the drought, she said the company had closely monitored the development and put in place guidelines and measures for water management to ensure ample supply to clients by means of consuming and preserving water resource in a sustainable way.

Most of the water used in the production of co-generation power plants come from recycle process or treated waste water from factories.

In addition, the company's plan to manage electricity production efficiently also enables effective water management.

BGRIM has worked closely with industrial estate operators for managing water usage prudently.

It has been confirmed that water reserves in wells in industrial estates are sufficient for operation until the rainy season.

"Rest assured that BGRIM's power plants will be able to serve and support the industrial sector continuously," Preeyanart said.

In regard to the impact of the global economic uncertainties on BGRIM, she pointed out that more than 70 per cent of the company's revenue come from power sales to government agencies, both in Thailand and overseas under 20-25 year contracts which are not subject to changes in economic conditions.

The rest of BGRIM's earnings derive from industrial sectors in Thailand and Vietnam where strong power demand looks set to continue, mainly due to the presence of world-class manufacturers from Japan.

The company has continued to sign on new industrial clients in Thailand, adding a combined 25 MW in demand last year.

Contracts for 15 MW power sales have been concluded with a group of customers which are expected to come on line in the first half of this year.

Meanwhile, there are demands from the more than 1,000 potential clients in industrial estates which are already in operation or under development.

BGRIM's combined installed capacity now stands at 3,424 MW from a total of 57 projects, 2,896 MW of which come from 46 projects already in service.

Construction of the 16-MW wind farm in Thailand and the 39-MW solar photovoltaic system in Cambodia is well underway for the start of commercial operation later this year.

The company has implemented an expansion plan for stable and sustainable growth towards securing not less than 5,000 MW in aggregate power sale deals by 2022 through new project development as well as mergers and acquisitions (M&A) of projects both at home and abroad.

These M&A accords are expected to be gradually concluded in the first half of this year.

Several development projects overseas are undergoing feasibility studies, including new ventures in South Korea, Vietnam, Malaysia, Cambodia and the Philippines.

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