BCPG closing in on Star Energy stake

BCPG Plc, the electricity-generating arm of SET-listed oil refiner Bangchak Petroleum Plc, is close to acquiring a geothermal power business in Indonesia as part of its ambition to be a leading renewable energy company in Asia.

President and chief executive Bundit Sapianchai said BCPG will spend 12 billion baht to buy a stake in Star Energy Group Holdings, which operates a 995-megawatt geothermal power and steam production plant in Indonesia.

He said the acquisition process is expected to be completed by the second quarter of this year, and BCPG is expected to book profits immediately.

After the acquisition is complete, BCPG will indirectly hold equity in three geothermal power projects with an equivalent total power production capacity of 182MW, which covers a 20% stake in the 347MW Wayang Windu Power Plant, 17.3% stake in the 377MW Salak Power Plant and 17.3% in 271MW Darajat Power Plant.

“All the projects have long term feed-in tariff contracts with Indonesia’s state electricity provider,” Mr Bundit said, referring to Perusahaan Listrik Negara (PLN).

He said the stake will be acquired using funds from the company’s cash flow and loans from financial institutions, which have already expressed interest in lending.

The plan will be proposed in an extraordinary shareholders’ general meeting on June 13, he said.

“We strongly believe that the investment will help enhance BCPG’s long-term stability and is in line with BCPG’s business growth strategy to diversify into other forms of renewable energy and into other countries,” Mr Bundit said.

With this investment, BCPG’s total power-generating capacity will surpass 600MW, he said, spanning solar and wind power businesses in Thailand, Japan and the Philippines.

BCPG shares closed yesterday on the Stock Exchange of Thailand at 12.90 baht, up 70 satang, in trade worth 236 million baht.