Yinson’s foray into Peru viewed positively
This is a positive announcement as the project is expected to contribute approximately RM16 million annually at full operational capacity, with an estimated tariff of US$0.03 per kWh, yielding an eight per cent (IRR).
Kenanga Research
KUCHING: Yinson Holdings Bhd’s (Yinson) acquisition of the Matarani Solar project in Peru garnered positive views from analysts as the project is expected to contribute approximately RM16 million to the group annually.
Of note, Yinson has successfully concluded the acquisition of the Matarani Solar project in Peru, with a capacity of 97MW, from Grenergy Renewables (Grenergy) for a consideration of US$90 million (including acquisition of stake and further earnouts payable to Grenergy).
The majority of the project’s energy is under a 15-year PPA with an undisclosed off-taker, set to commence in 3Q24.
In a report, the research team at Kenanga Investment Bank Bhd (Kenanga Research) said: “This is a positive announcement as the project is expected to contribute approximately RM16 million annually at full operational capacity, with an estimated tariff of US$0.03 per kWh, yielding an eight per cent (IRR). Grenergy will handle the Engineering, Procurement, Construction, and Commissioning (EPCC) and provide operation and maintenance services for the initial two years upon full commencement, ensuring a smooth and timely project completion.”
Despite the commencement of the Matarani Solar project in 3QFY25, the research team expected contributions from the project to be largely offset by startup costs.
Nevertheless, it maintained its ‘outperform’ call on the stock.
It said: “We continue to favour Yinson due to a strong FPSO order book pipeline with multiple major FPSO jobs under the conversion stage which provides significant earnings growth in coming years, its strong project execution track record which positions the company to benefit from strong structural demand for FPSO contractors anticipated in the coming years, and it being one of the first local oil & gas company invest in green technology companies (solar, e-mobility, and others) which in our view would help with the company’s longterm energy transition agenda.”