Mudajaya poised for RM100mil TRX job
Concession to supply central cooling system for up to 20 years
PETALING JAYA: Mudajaya Group Bhd, in a tieup with a French firm, is the frontrunner to clinch a long-term concession with 1Malaysia Development Bhd (1MDB) to supply the central cooling system for the Tun Razak Exchange (TRX), according to sources.
The contract, likely to be awarded on a build-own-operate basis, could be valued at some RM100mil, with a concession period of up to 20 years.
The construction outfit has been named a preferred bidder among several companies that had submitted bids, people close to the matter told Star Biz.
1MDB had said two weeks ago that it had signed a 20-year concession agreement with Veolia Water Technologies Southeast Asia to provide wastewater treatment and recycled water supply in TRX.
The wastewater treatment plant, to be built and operated by Veolia, is expected to cut water usage by more than 50%.
TRX, earmarked as the city’s new financial district, is a 28.3ha, RM18bil mixed-use development in the Imbi area of Kuala Lumpur.
Star Biz reported recently that all parcels of land for phase 1 of TRX had been sold to investors, with 1MDB retaining about five parcels for itself as the master developer for recurring income.
Phase 1 of TRX comprises four office towers, five residential towers, two five-star hotels and a shopping complex.
Separately, the company said it would not be affected by the mass cancellation of coal block licences in India by its supreme court two weeks ago.
According to reports, all but four of the country’s 218 coal block licences given to companies since 1993 have been declared illegal.
Industry players have said the move would severely disrupt the supply of coal and worsen India’s power crisis, besides eroding investor confidence.
The top court spared two blocks awarded to a large power project of 4,000MW that were allotted through auctions and one each to state-run NTPC Ltd and Steel Authority of India, Bloomberg reported.
Mudajaya’s coal block licence was not one of the four. However, the licensing issues are not expected to hamper its 26%-owned 1,440MW coal-fired power plant in Chhattisgarh because of a coal supply agreement it has in place with Coal India Ltd, a state-controlled coal mining company.
“Even if Mudajaya’s coal block allocation is rescinded, the coal supply agreement will ensure that the plant gets its promised supply of coal from Coal India,” an analyst said.
Mudajaya’s interest in the plant is via its associate RKM Powergen Pte Ltd, which, in turn, owns 22% of the Fatehpur East coal block together with four partners.
The plant, which has a 20-year power purchase agreement with the state, was previously plagued by coal supply issues until it signed an accord in September last year for a total contracted volume of 6.24 million tonnes of coal per year.
Its coal supply agreement comes with a fuel pass-through mechanism that allows any changes in coal prices to be reflected in power tariffs, shielding Mudajaya from price swings in the commodity.
Following several delays, the plant is targeted to be commissioned by year-end.
Mudajaya group managing director and chief executive officer Anto Joseph had said in a statement dated Sept 26 that it had not been notified by the Indian authorities of any further development on its coal block licence.
“The coal block allocation acts only to supplement the tapering coal-linkage supply requirement of RKM Powergen and has no impact to the operations of the power plant project,” he said.
Shares of Mudajaya were last quoted at RM1.96, down 32% year-to-date and its lowest since 2011.