Announcement of erex participating in hydroelectric power project in the Kingdom of Cambodia
Our first overseas hydroelectric project
erex Co.,Ltd. (hereinafter referred to as “our company”) determined to invest in SPHP-Singapore, which received the business right from the Cambodian government for “The Stung Pursat #1 Hydroelectric Project” (hereinafter referred to as “the project”). This is a hydroelectric power plant construction project with an output of 80,000 kW in the Kingdom of Cambodia (hereinafter referred to as “Cambodia”).
Our company will make a joint investment with Asia Energy Power Co. Ltd. (Headquarters: Cambodia, hereinafter referred to as “Asia Energy”) and ISDN Energy Pte Ltd. (Headquarters: Singapore, hereinafter referred to as “ISDN Energy”).
1.Purpose of the project
Cambodia has achieved one of the highest economic growth rates in Asia, and is attracting attention from foreign companies as a production base in Asia due to the abundant young labor force. The country is expected to even grow in the future.
On the other hand, electric power, which is an essential factor for economic development, has been plagued with a shortage of electricity due to a drop in power generation at hydroelectric power plants during the dry season, and this situation is expected to become more serious in the future.
Currently, the country relies on electricity imports from neighboring countries such as Thailand and Vietnam, but even though, the country is still unable to supply enough electricity and has been forced to implement planned power outages.
The project is expected to play a major role in offering stable electricity supply in Cambodia because the project is a hydroelectric project with a large-scale reservoir and is able to generate electricity throughout the year.
In addition, the Cambodian government has high expectations for the project, and the project has been positioned as a very important electric power business for the country’s economic development.”
2．Reason of our company’s participation
As a leading company of renewable energy field, we are engaged in the electric power business from fuel procurement to electric power and retailing, and actively working to achieve a low-carbon society both in Japan and overseas.
This is our first time to participate in the hydroelectric and overseas power generation business, leveraging our overseas expertise in electric power business development, operation and maintenance, and fuel procurement, which we have developed over the years.
We have positioned this project as our first step in expanding our new business field.
By participating in this project, we hope that our company could help solve Cambodia’s energy problems and contribute to realize a low-carbon society in the country.
In addition, based on the “Challenge culture” that has been with us since our founding, we have been developing new business fields, such as a biomass power plant using palm kernel shells (PKS), and we are now working on the realization of Japan’s first large-scale biomass power plant that does not depend on the FIT system.
3. Overview of the project
The project is to construct a new hydroelectric power plant with a capacity of 80,000 kW in Porsat province, Cambodia.
SPHP-Cambodia, a wholly owned subsidiary of SPHP-Singapore, has already acquired a guarantee from the Cambodian government regarding the project right for setting up this power plant and a fixed price electricity transaction with the Electricity Authority of Cambodia (EAC). This power plant is planned to be transferred to Electricity Authority of Cambodia (EAC) after 35 years of operation.
We have made a new investment in SPHP-Singapore, together with Asia energy and ISDN energy, to participate in the construction and operation of the hydroelectric power plant, which will be managed by SPHP-Cambodia.
| Project name | The Stung Pursat #1 Hydroelectric Project |
| Power output capacity | 80MW (20MW×4Units)/369GWh/year |
| Business owner | SPHP-Cambodia |
| Total investment cost | USD 231 million |
| Scheduled to operate | February, 2023 |
| Power sales contractor | Electricity Authority of Cambodia (EAC) |
| Sales price | 7.9¢/kWh fixed for 35 years (369 GWh/year as base case and reviewed every 5 years) |
| Dam area, water reserves | 85㎢ (1.2 billion square meters) |
| Dam height | 100m rockfill (concrete surface layer) |
| Dam length | 687m |
| maximum water depth | 180m |
| effective head | 148ｍ |
4. Investors composition and business scheme
5.Funding proposal
Borrowing: capital contribution = 70% (USD162 million): 30% (USD69 million)
6.Planned construction site and conceptual drawing
■Reference information
１. Asia Energy Power Co.Ltd.
| Headquarters location | Phnom Penh, Cambodia |
| Representative | KIM Seunggu |
| Date of establishment | December 31st, 2015 |
| Capital | USD 100,000 |
| Business overview | Electricity power business and import/export business activities in Cambodia |
2. ISDN Energy Pte Ltd.
| Headquarters location | Singapore |
| Representative | TEO Cher Koon |
| Date of establishment | April 17th, 2013 |
| Capital | SGD1960 |
| Business overview | Engineering business in the energy field, including hydroelectric power generation |
3. erex Co.,Ltd.
| Headquarters location | 2-2-1, Kyobashi 2-chome, Chuo-ku, Tokyo |
| Representative | Hitoshi Honna |
| Date of establishment | December 8th, 1999 |
| Capital | 5.1 billion yen |
| Business overview | Retail electricity business, power supply development, fuel and electric power trading |
■Contact details for inquiries
erex Co.,Ltd.
IR public relations office
TEL：+81-3-3243-1167 e-mail：pr.info@erex.co.jp