Published On: Tue, Jul 6th, 2010

EPC contract signed for major coal-fired power plant

Tan Tao Energy Corporation (TEC) of the Tan Tao Group has signed an engineering, procurement and construction (EPC) contract with China Huadian Engineering Co Ltd (CHEC) to build a major coal-fired power station in the Mekong Delta.

CHEC, a unit of China Huadian Corporation (CHD), is responsible for phase one of the 1,200- MW Kien Luong 1 Thermal Power Plant, the first BOO (build, own, operate) project in Vietnam, with total investment capital of about $2 billion.

The development of Kien Luong Coal-Fired Power Plant Complex (KLPP) was approved in January 2008 at Kien Luong Power Complex in Kien Giang Province, about 300 km southwest of HCM City.

The KLPP will be one of the largest power generation centers in the country, with a capacity of up to 4,400-5,200MW (comprising three phases, phase 1 with 1,200MW, phase 2 with 1,200MW and phase III with 2,000MW). This is also the first thermal power project ever assigned by the government of Vietnam to the private sector.

After the signing of the EPC contract, the construction of the project will start from the issuance of Notice to Proceed and last 39 months. The commercial operation of the first unit will start at the end of 2013 and that of the second unit at the beginning of 2014.

The project will help to increase the power capacity and contribute to meeting the fast-growing electricity demand in the southern region of Vietnam, according to a TEC statement. Coal for the complex will be from other countries, including Australia, Russia and Indonesia.

The project’s consultants, specialising in multiple fields and from various countries, are well established and experienced in large power plants. They include Standard Chartered Bank (England), financial consultant, Mott MacDonald (England), engineering consultant, Orrick (United States), law consultant, Deloitte (Vietnam), taxation and accounting consultant, Marson (United States), coal consultant, Willis (Singapore), insurance consultant, and Black & Veatch (United States), feasibility-study consultant, according to TEC’s website.

Given the importance of the project, CHEC was selected to sign the EPC contract with Tan Tao Energy Corporation, the project company, due to its demonstrated, proven track record of constructing large-scale thermal power projects in China, Indonesia, the Philippines and Vietnam, according to the statement.

By the end of 2007, CHD had an installed capacity of 63,020 MW and an annual power output of 258.2 billion KWh, with power stations in 25 provinces and regions in China, 26 of the power stations being large, with installed capacity of over 1000MW each.

The deal was inked in Beijing, with in attendance the management team from Tan Tao Group, led by chairwoman Dang Thi Hoang Yen, together with its financial and legal consulting teams, Standard Chartered Bank and Shearman & Sterling LLP, according to a statement of the local company.

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