Editorial Asia Nikkei 16/08/2021
The investment for the power plant is a huge expense for Banpu but it is part of its plan to absorb advanced technologies from the U.S. (Photo courtesy of Banpu)
APORNRATH PHOONPHONGPHIPHAT, Nikkei staff writer
August 16, 2021 | Thailand
BANGKOK — Thailand’s biggest coal miner Banpu has invested $430 million to acquire a 100% stake in a large-scale gas-fired power plant in the U.S., hurrying to move away from its main business, which has a large environmental impact, to a green business.
The company acquired the power plant in Texas from Temple Generation I and signed the contract on Aug. 10. The transaction is expected to be complete by the fourth quarter of 2021.
Banpu also invested $770 million in December 2019 to acquire a shale gas operation in Texas. It can provide gas to the power plant that the company bought in Texas at competitive prices. https://asia.nikkei.com/Business/Energy/Thai-coal-major-Banpu-buys-US-shale-gas-assets-for-770m
BANGKOK — Thailand’s biggest coal miner Banpu has invested $430 million to acquire a 100% stake in a large-scale gas-fired power plant in the U.S., hurrying to move away from its main business, which has a large environmental impact, to a green business.
The company acquired the power plant in Texas from Temple Generation I and signed the contract on Aug. 10. The transaction is expected to be complete by the fourth quarter of 2021.
Banpu also invested $770 million in December 2019 to acquire a shale gas operation in Texas. It can provide gas to the power plant that the company bought in Texas at competitive prices. https://asia.nikkei.com/Business/Energy/Thai-coal-major-Banpu-buys-US-shale-gas-assets-for-770m
The investment matches the company’s business plan to go greener. Somruedee Chaimongkol, Banpu’s chief executive officer, told Nikkei Asia in an interview in July that the company would gradually cut the role of the coal business and instead shift business resources toward natural gas and renewable energy. The company is aiming to have low-carbon green businesses contribute more than half of overall income by 2025.
An analyst at Kasikorn Research Center, a think-thank unit of Thai Kasikorn Bank, said this acquisition will help the company to immediately gain higher power generating capacity in green business. It will see benefits quicker than by building a new plant and waiting for years to start commercial operations.
Banpu’s power plant in Texas is a combined cycle gas-fired power plant with generating capacity of 768 MW and started commercial operation in July 2014. With the new investment, the company’s total equity-based capacity will total 3,300 MW from 34 gas-fired, co-generation and renewable power plants in Thailand and abroad.
Somruedee said in the statement that the new power plant has one of the most efficient combined-cycle gas turbines, with high flexibility and efficiency and is equipped with advanced emissions-control technology.
The company’s technological capabilities in green business are still relatively low, and this acquisition is also aimed at absorbing advanced technologies from the U.S. company. It has been a huge expense for the company, but shareholder pressure for green commercialization is growing. Banpu is accelerating the response to it, even if it means making some sacrifices.
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