TNB considers merger deals to go for renewable energy
KUALA LUMPUR: Tenaga Nasional Bhd (TNB), the most valuable listed utility company in emerging Asia, is looking to sell its gas-fired power plant in Pakistan as it pushes forward with a plan to rely more on renewable sources of energy.
Malaysia’s state-owned electricity producer wants to reduce reliance on fossil fuel, which accounts for about 70% of its power generation, chief executive officer Datuk Seri Azman Mohd said in an interview.
The company is also considering increasing its stake in Turkey’s Gama Enerji AS that produces electricity using water, wind and natural gas, he said.
“Our strategy is to invest in a combination of developed countries and emerging countries, contracted and market, fossil fuel and renewable we are increasing our renewable,” Azman said in his first interview with international media since taking the helm in 2012. TNB has a market value of nearly RM90bil, beating publicly traded peers including India’s NTPC Ltd and China’s Huaneng Power International Inc.
The Malaysian company’s push toward sustainable sources of electricity aligns with the agenda set out by Energy Minister Yeo Bee Yin ( pic), who said this week that she’s confident of meeting a 20% renewable energy target by 2030, from 2% currently.
TNB wants to produce 1,700 MW from green energy by 2025, from 280 MW, according to a December investor presentation. That compares with the company’s total installed capacity of 24,139 MW, enough to power at least 1.6 million mid-sized homes.
Azman declined to give pricing details for the deals in Pakistan or Turkey as both are still in exploration stages. TNB owns 30% of Gama Enerji with more than 1,100 MW of installed power in Turkey, as well as a 235 MW power plant in Pakistan’s Sindh province.
The company seeks to build up its international investments, including its power assets in the UK and India, until they account for 20% of earnings by 2025, according to its website.
“Shareholders’ returns is always paramount,” Azman said. “So we are always looking at the gearing, and that’s why we are talking about monetising certain things because we have to maintain the gearing at an optimum level.”
TNB has total debt of RM47.6bil as well as cash and equivalents of RM14.6bil as of June 30, data compiled by Bloomberg showed.
Azman said utilities need to find better ways of offering electricity to customers and can’t afford to be complacent given technological advances.
TNB is exploring the potential of using its network to deliver Internet connection, with a pilot project started in Melaka to assess the plan’s viability, according to a stock exchange filing last month. — Bloomberg ISKANDAR PUTERI: Mah Sing Group Bhd has inked a memorandum of understanding (MoU) with the Netherlands Maritime Institute of Technology (NMIT) to provide fully-furnished accommodation for the institute’s students.
“We are happy to collaborate with NMIT as Mah Sing is always looking ahead to work with different parties to enhance the community.
“This is the third collaboration that we have formed to provide accommodation for the community that is studying or working around Iskandar Puteri.
“Earlier this year, we partnered EduCity Iskandar Malaysia and i2M Ventures Sdn Bhd,” said Mah Sing senior general manager of development (southern region) Benjamin Ong after the signing of the MoU.
Ong signed on behalf of Mah Sing while NMIT was represented by its director Dr Mohd Farhan Razali. NMIT viewed the partnership as timely since the maritime industry was growing globally and would see more students enrolling in the institute.
“By partnering Mah Sing to provide the ideal accommodation for our Educity campus students, we believe that this would help to create a conducive living environment for them and enhance their learning experience,” he added. — Bernama