KUCHING: The state government has reached an agreement to acquire the entire equity interest of Sarawak Hidro Sdn Bhd (SHSB), the owner and operator of the Bakun hydroelectric plant (HEP) from the federal government.
Chief Minister Datuk Amar Abang Johari Tun Openg announced this at a press conference at Wisma Bapa Malaysia here yesterday.
The state government’s wholly owned company Sarawak Energy Bhd (SEB) will make the acquisition priced at RM2.5 billion.
However, SEB shall take over the servicing of SHSB’s outstanding loan amounting to about RM6 billion.
The acquisition of SHSB will enable the state government and SEB to have full ownership of all electricity generation facilities in Sarawak, providing SEB with greater flexibility in optimising the management and operation of electricity supply in the state.
SHSB is owned by the federal government through the Finance Ministry and Federal Lands Commissioner, and was established to develop and manage the Bakun HEP.
The plant was fully commissioned in July 2014 with an installed capacity of 2,400MW.
“This is a major concession by Putrajaya and I would like to thank the Prime Minister (Datuk Seri Najib Tun Razak) for this.
“The acquisition of Bakun HEP represents part of our overall strategic plan to develop and consolidate the state’s abundant energy resources, which places the state in full control of the energy for the benefit of our people and our economy in the long run,” said Abang Johari, who is also the Minister of Resource Planning and Environment.
He added that the acquisition would spur Sarawak to become a powerhouse that would enable it to lower electricity tariffs for local consumers as well as export surplus power to neighbouring countries.
He said the agreement was reached between him and the prime minister last month.
“What this means now is that we are acquiring Bakun HEP ‘lock, stock and barrel’. Meaning Bakun HEP is now ours and all the energy production is Sarawak-owned. In the long-run, it will benefit the people,” Abang Johari told the packed press conference.
The chief minister also revealed that the final acquisition process would be finalised within the next two months.
“With this power that we have, we can venture into digital economy where we need both energy and water to develop the whole state, especially the rural areas,” he said.
He highlighted that the strategic acquisition would enable the state to maintain power security and reliability and enable operational efficiency through better integration of the Bakun and Murum HEPs.
The 944MW Murum HEP, located upstream of Bakun HEP, was developed and is owned and operated by Sarawak Energy Group.
Abang Johari revealed that besides Bakun, Murum and Batang Ai HEPs, Sarawak would soon have four more HEP dams, including the proposed Baleh HEP dam.
With the completion of Baleh HEP in the next nine years, Sarawak will have a staggering 4,500MW of power that will ensure its ability to offer cheaper electricity to both local consumers and investors, so as to achieve its goal to be a fully developed state by 2030.
On the Federal Land Commissioner’s involvement, Abang Johari said this was because the enormous lake resulting from the Bakun dam embankment, as well of the land involved in the HEP – equivalent to the size of Singapore – had all previously belonged to SHSB under the Ministry of Finance.
“Now we also need to acquire all these for us to develop Bakun lake as a tourism destination,” he said.
Meanwhile, SEB in a statement said it was grateful to the state government, especially the chief minister, for their continuing trust in the group as it was entrusted with delivering the state’s strategy to develop and consolidate Sarawak’s abundant energy resources for the benefit of Sarawakians.
“We feel there is a strong operational synergy to be realised between Bakun and Murum HEPs, especially given our knowledge and experience in managing hydropower plants going back over 30 years to Batang Ai.”
SEB also said it was finalising the details of the transaction with the Ministry of Finance officials and would make formal announcement with the state government upon the signing of the share sale agreement.
Present at the press conference were Minister of Public Utilities Dato Sri Dr Stephen Rundi, State Secretary Tan Sri Datuk Amar Mohamad Morshidi Abdul Ghani, SEB chairman Datuk Amar Hamed Sepawi and SEB chief executive officer Sharbini Suhaili.