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Infrastructure & PPPs in Singapore, Laos and Cambodia - Q2 2023 Update

YOG INFRA Q2 2023 insights

Encouraging developments in areas of clean energy transition in SINGAPORE, LAOS and CAMBODIA with notable initiatives in areas of green ammonia production, utilization of carbon credits as a means of financing proejcts. There is a continued focus on solar projects in both Cambodia and Laos, with investments annoucements from international developers. Cambodia has also annouced a tangible project pipeline through its Comprehensive Intermodal Comprehensive Master Plan (CIT-MP) with around 50 infrastructure projects.

Read the latest developments in Infrastructure and PPPs in the three countries in our latst insight.

 

Singapore

KEPPEL AND EXXONMOBIL TO EXPLORE LOW CARBON AMMONIA SOLUTIONS

Keppel Infrastructure and ExxonMobil Asia Pacific have signed a memorandum of understanding (MoU) to develop access to low-carbon hydrogen and ammonia for scalable commercial and industrial applications in Singapore. The MoU follows the Singapore government’s launch of its National Hydrogen Strategy, which expects hydrogen to meet up to half of the city-state’s power needs by 2050.

As part of this strategy, the Energy Market Authority and the Maritime and Port Authority of Singapore issued an expression of interest for proposals to build, own and operate low or zero-carbon power generation and bunkering facilities on Jurong Island. The partnership intends to develop competitive solutions to support Jurong Island’s sustainability goals and Singapore’s hydrogen strategy.


SINGAPORE AND CAMBODIA TO COLLABORATE ON CARBON CREDITS

Singapore and Cambodia have agreed to collaborate on carbon credits. The two have decided to work towards signing a legally binding bilateral agreement that sets out a framework for the international transfer of correspondingly adjusted carbon credits by the end of year 2023. Both countries will also identify mutually beneficial carbon credit projects, compliant with Article 6 of the Paris Agreement, which allows countries to cooperate to achieve emission targets set out in their Nationally Determined Contributions (NDC), promoting sustainable development and environmental integrity.


SINGAPORE CONSIDERS CENTRAL FRAMEWORK TO ENSURE GENERATION CAPACITY

Singapore's Energy Market Authority (EMA) is proposing a centralized process to facilitate guide private investments in new generation capacity. As per the proposed process, the EMA will continue to forecast electricity demand on a rolling 10-year basis and the generation capacity available in the system. Should the projections show there is insufficient capacity to meet system needs, the regulator will issue a request for proposal to the private sector to build, own and operate the required capacity. The EMA will step in if there is no private sector interest. The authority intends to launch the first RFP for new capacity that will be required in 2028.


SINGAPORE'S SEMBCORP SIGNS USD 133 MN PPA WITH SINGTEL

Singapore-based Sembcorp Industries' power generation unit has agreed a power purchase agreement (PPA) worth SGD180 Mn (USD 133 Mn) with Singtel Telecommunications (Singtel). Sembcorp Power will supply power to the national telecommunication company for 10 years.

The power will be supplied to Singtel from Sembcorp's two existing cogeneration plants Sakra and Banyan in Singapore's Jurong Island as well as a 600 MW hydrogen-ready power project that Sembcorp is building in Jurong Island and is due to be completed in 2026.

Sembcorp's two gas-fired cogeneration facilities Sakra and Banyan can produce a combined capacity of over 1.2 GW power and 1,100 tonnes per hour steam.


Cambodia

NA GREENLIGHTS WORK ON 700 MW OF SOLAR PLANTS IN CAMBODIA

The National Assembly (NA) has approved works on 6 renewable energy (RE) plants, with a combined capacity of 670 MW, in Cambodia. This consists of 4 solar power projects as well as 2 hydropower facilities. The solar power developments greenlighted include an 80 MW plant in Prey Veng province owned by Lucky Solar Power Company Limited and 3 of Snetec Company Limited’s projects in Pursat (150 MW), Svay Rieng (60 MW) and Kampong Chhnang (60 MW).

Both the hydropower facilities will be located in the Koh Kong province. The projects approved includes Stung Meteuk Hydropower Company’s 150 MW Stung Meteuk as well as Khmer Electrical Power Company Limited’s 70 MW Stung Russey Chrum Kandal and 100 MW Stung Veal Thmor Kambot, which is counted as a single venture. Once operational, power generated from these facilities will be key in stabilising energy prices and supply in Cambodia.


GOVERNMENT OF CAMBODIA SEEKS DEVELOPER FOR MONDULKIRI AIRPORT

Cambodia is looking for partners for the development of a planned airport in Mondulkiri province south of Sen Monorom town after Power China International Group Ltd (PIG) withdrew during the Covid-19 crisis and subsequent negotiations with other foreign companies fell. The airport is planned for a 300-hectare site in O’Raing district’s Sen Monorom commune – which borders the town of the same name to the south – and anticipated to cost more than USD 80 Mn. A Mondulkiri airport will facilitate travel for domestic and foreign tourists between “economic poles” (or regions of concentrated economic activity), as well as speed up the movement of freight. The State Secretariat of Civil Aviation (SSCA) is looking to seek legitimate, top-quality partners to invest in the project.


CHEC TO BUILD USD 1.5 BN PORT IN CAMBODIA

China Harbour Engineering Company Limited (CHEC) has secured a USD 1.5 Bn contract from Kampot Logistics and Port Company to build a multi-purpose seaport in Cambodia. Works on the 600-hectare facility will be carried out in 3 phases. Phase 1 will require a total investment of USD 200 Mn till 2025. The port will be able to handle 300,000 TEUs under phase 1, with capacity doubled to 600,000 TEUs by 2030. The Kampot port will feature a container terminal, a special economic zone (SEZ), an oil refinery, among others. Once operational, this will be the 3rd largest port in Cambodia behind the Sihanoukville Autonomous Port and the Phnom Penh Autonomous Port.


MOT TO BUILD 138 KM ROAD BETWEEN VIETNAM AND CAMBODIA

Cambodia’s Ministry of Transport (MOT) will build a 138-km-long motorway linking the capital city of Phnom Penh to Vietnam. Works on the USD 1.6 Bn road project are scheduled to commence in June 2024. The road will follow the same route as the 2-lane National Highway 1. Once completed, this will be the 2nd modern motorway in Cambodia. Additionally, Vietnam’s MOT will simultaneously build a road between Moc Ba and Ho Chi Minh City. Both the new motorways will be opened to passenger traffic in early 2027.


GOVERNMENT OF CAMBODIA REQUIRES USD 30 BN FOR PLANNED INFRA PROJECTS

The Government of Cambodia is seeking to attract investments of around USD 30 Bn to bankroll around 50 priority infrastructure projects over the next 10 years. The projects are a part of the Comprehensive Intermodal Comprehensive Master Plan (CIT-MP) and covers intermodal transportation connectivity and logistics sectors including roads, rails, waterways, airways, ports. The projects will either be financed with external loans, through public-private partnership (PPP) schemes or through the national budget.

Some of the key projects include the Phnom Penh-Siem Reap Expressway and Phnom Penh-Poipet Speedy Railway for which studies are currently ongoing. The government is also seeking investment partners for these projects.


Laos

POWERCHINA PARTNERS FOR LAOS SOLAR AND THAI EFW PROJECTS

Power Construction Corporation of China's (PowerChina) international arm has signed preliminary agreements to develop two renewables projects in Southeast Asia. One of these is with Thai utility Superblock for a 609 MW solar project in Sekong province in southern Laos. The second is for an energy-from-waste project in Thailand, for which the two companies have partnered with Shanghai-head quartered US Environment. The project, to be given out as a 22-year concession, will have a daily waste treatment capacity of 1,000 tonnes and will be built in Nonthaburi town in the southern part of the country.

The Nonthaburi EfW project is estimated to cost about USD 110 Mn. It will be divided into two stages, with the fi rst phase of construction scheduled to be to completed in two years


SOUTHERN GRID PLANS LAOTIAN RENEWABLES PORTFOLIO FOR CHINA IMPORT

China Southern Power Grid is looking to develop a large-scale portfolio of renewables power projects in Laos, with a view to later purchasing the green electricity and transmitting it to China. The state-owned grid operator is still in the preliminary stages of planning for the project, and it will hire external advisors to help estimate the scale of the project and work out a detailed plan. The projects will include solar, wind, hydropower, and battery storage facilities in northern Laos.

The power is set to be exported to China through a 500 kV transmission line connecting Laos with China’s southwest Yunnan province and it is likely to be used by power consumers in the southern region. Southern Grid Signed agreements with Laotian state utility Électricité du Laos (EDL) to work together on building transmission lines to connect Laos and China.

 

List of Key Transactions - Singapore Q2-2023



List of Key Transactions - Cambodia Q2-2023



 

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YOG INFRA is an infrastructure focused financial advisory firm. We work with Developers and Development Finance Institutions (DFIs) and help them make informed investment decisions across infrastructure development lifecycle.

With our offices in Singapore, India and UAE, we work on projects globally, and the team brings strong experience in supporting development of infrastructure projects.


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