GB3 Power Plant

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GB3 was a 640MW natural gas fired expansion of the existing Lumut plant in the northern Perak state. The original Lumut plant had a 1,303-MW capacity and was constructed, owned and operated by Segari Energy Venture, a Malakoff Bhd. majority owned company. The expansion was to occur in two phases. It was to be developed initially as a 430 MW open-cycle gas turbine power plant, later converted into a 650 MW combined-cycle gas turbine power plant. The conversion was completed on January 31, 2003. The project was being developed by GB3 Sdn Bhd, a private company that was a 100% subsidiary of Malakoff Bhd. In June of 2001, Malaysian state-controlled power utility Tenaga Nasional Bhd (TNB) agreed to buy a 20% stake in GB3 Sdn. TNB also signed a power purchase agreement (PPA) to buy power from the plant at 12.14 Malaysian cents per kilowatt-hour for a 21-year period. GB3 was selling 91.5% of the power it genertated to TNB by 2004. The Employees Provident Fund's subscription of a further 50,000 GB3 shares (5%) on August 29, 2003 brought Malakoff's ownership to 75%. The company entered into agreements on engineering, procurement and construction (EPC) with a French company, Altsom Power Asia Pacific Sdn Bhd. for Alstom to undertake turnkey construction of the power plant. The GB3 project began commercial operations on three 143-MW open cycle gas turbines in February 2002. Financial closure was achieved on December 20, 2001. RM850 million (US$224 million) was raised through Islamic bonds. Aseanbankers Malaysia Berhad and Citibank Berhad jointly managed the project financing which was based on a debt equity ratio of 80:20. The total cost of the project was around US$394 million.