Islamic financing worth US$652 million for Malaysian power plant
Gas-fired facility to generate electricity for 500,000 households
7 Apr 2021 | Michael Marray

Bank Pembangunan Malaysia Bhd (BPMB), also known as Malaysia Development Bank, has signed an Islamic finance facility amounting to 2.7 billion ringgit (US$652 million) to support the construction of the Pulau Indah power plant in Selangor.  It is joined by Maybank Islamic Bhd and United Overseas Bank (Malaysia) Bhd in structuring the Shariah-compliant Commodity Murabahah Term Financing-i facility.

The Pulau Indah Power Plant Sdn Bhd (PIPP) is 75% owned by Worldwide Holdings and 25% by Korea Electric Power. The 1,200MW combined cycle gas turbine power plant is scheduled to be commissioned in 2024, with total project cost estimated at 3.3 billion ringgit. The project will be a major contributor to the economic growth of the state of Selangor and the larger Klang Valley.

The power project is located on reclaimed land next to the Port Klang Free Zone. It is around 50 kilometres from Kuala Lumpur, and will generate enough electricity to supply 500,000 households.   

The project has signed a 21-year power purchase agreement with Tenaga Nasional Berhad. It will utilize two 600MW gas turbines supplied by General Electric, which has also signed a 21-year services agreement.

On March 24 GE finalized its contract with the engineering, procurement and construction (EPC) consortium of Posco Engineering & Construction (POSCO), Mitsubishi Corporation and PEC Powercon.

Treasury & Capital Markets
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