Tenaga to operate controversial Bakun project
Thursday January22, 2009 12:15 pm
Malaysiakini.com. Jan 21, 2009.
Tenaga Nasional and Sarawak Energy Berhad (SEB) today said they had received government approval to take over operations of the controversial Bakun hydro-electricity project.
The companies said they will also develop the power transmission system from eastern Sarawak state on Borneo island to Peninsular Malaysia.
The announcement comes after Sime Darby, the world’s largest listed palm oil producer, last June said it will not take an equity stake in the Bakun project.
Sime Darby was previously expected to lead a consortium in the construction of the six billion ringgit project in eastern Sarawak state on Borneo island. The 2,400 megawatt dam was approved in 1993 and is expected to be completed in 2010.
The government has proposed a 700-kilometre undersea cable link to transmit power generated by the dam to southern Johor state on the mainland.
Objections from environmentalists
Both Tenaga and SEB would form a special purpose vehicle (SPV) to jointly take over the project from government-owned Sarawak Hidro through a leasing agreement, Dow Jones Newswires said.
Construction of the Bakun project is nearing completion and Sarawak Hidro will continue to develop the project until full commissioning, after which the operations will be taken over by the SPV, the companies said in separate statements to the stock exchange.
“The proposed scheme is expected to export approximately 1,600 MW from the Bakun (hydro-electric project) to Peninsular Malaysia via high voltage direct current transmission system and the remaining power to Sarawak,” Tenaga said.
The dam, which involves flooding an area the size of Singapore, has attracted fierce criticism because of its harmful impact on the environment.
Some 10,000 residents have had to evacuate the project site.
Environmentalists have also said the undersea cable would be unsafe because it lies across an earthquake-prone region.
-AFP