Posted on 18 Dec 2015
In a statement released yesterday JAKS said it has registered its shareholder loan agreement with the state bank of Vietnam and that it has received the issuance of legal opinion from the Ministry of Justice of Vietnam, formalising the financial close of the project at Phuc Commune, Kinh Mon District in Hai Duong Province, Vietnam.
JAKS’ Vietnam IPP project is spearheaded by JHDP, the JV company owned by JAKS and China Power Engineering Consulting Group Co. Ltd (CPECC).
Preliminary construction work on the 25-year build-operate-transfer project has already started, with land clearing and boundary walls completed.
Total engineering, procurement & construction (EPC) works for the project amounted to US$1.52 billion, of which EPC Contract 1, valued at US$1.06 billion (approx. RM4.40 billion) was awarded to a CPECC-led Consortium, whilst JAKS was awarded EPC Contract 2, worth US$454.5 million for the civil and M&E engineering portion over the four year construction period of the IPP.
Contribution from EPC Contract 2 to JAKS’s infrastructure construction will be substantial, having raised its orderbook to RM3.5 billion for the year ending 2015. JAKS expects work on the Vietnam IPP to have a positive impact on its construction division from FY2016.
On completion of construction and upon commencement of commercial operations of the Vietnam IPP project, JAKS will also enjoy recurrent concession-type earnings from the generation and sale of power under its power purchasing agreement with the Vietnam government.
