Sarawak Energy, GE, and Sinohydro to build 400MW CCGT Block in Malaysia

State Government owned utility and energy development company, Sarawak Energy yesterday signed an agreement for the construction of the 400 MW Combined Cycle Gas Turbine (CCGT) Block at Tanjung Kidurong, Bintulu with giants General Electric (GE) and Sinohydro.

Estimated to cost RM 1 billion, the project will commence at the end of November 2016 and is expected to be completed by the middle of 2019.  The project will see new advanced gas turbine technology and more efficient combined cycle gas turbines replacing the existing open cycle turbines at the Tanjung Kidurong Power Station in Bintulu, Sarawak.  The new CCGT Block will be built within the existing Tanjung Kidurong (Bintulu) Power Station.

The project will see GE, a world leader in power generation solutions for utilities, takes the lead as the Engineering Procurement & Construction (EPC) contractor with consortium partner, Sinohydro, China’s leading power and infrastructure EPC contractor.  This contract is the main package for the project, out of six packages.  The remaining packages are open to local contractors as part of the Sarawak Energy’s continued commitment to maximise local participation and content in all of its contracts.

Signing for Sarawak Energy were its Group Chief Executive Officer Datuk Torstein Dale SjØtveit, Chief Operating Officer, Mr. Lu Yew Hung and Executive Vice President of SEB Power, Mr. James Ung.

The contract was signed with a consortium of four companies; GE Power Solutions (Malaysia) Sdn Bhd, GE (Switzerland)  GmbH, Sinohydro Corporation (M) Sdn Bhd and Sinohydro Corporation Ltd.

The companies were represented by:

1.  GE Power Solutions (Malaysia) Sdn Bhd:  Mr. Julian Ng Hon Leong, Senior Sales and Proposal Manager & Mr Tiew Richard, Senior Tender Manager
2.  GE (Switzerland) GMBH:  Mr. Venkat Kannan, Regional General Manager & Mr. Vasu Swami, Regional Sales Director
3.   Sinohydro Corporation (M) Sdn. Bhd:  Mr. He Feng, Senior General Manager & Mr. Vincent Kok Chen Yung, Senior Business Manager
4.  Sinohydro Corporation Ltd: Mr. Liu Wei, Executive Vice President & Mr. Gu Hongliang, Senior Manager.

The ceremony also saw the signing of an agreement to key terms for the proposed Long Term Service Agreement (LTSA) to provide operation and maintenance (O&M) services and support for the power plant over an 8-year term based on the power plant’s requirement. The LTSA also includes training of O&M personnel, supply of major spares as well as setting up a Computerised Maintenance Management System (CMMS). Subject to continuing discussions and Sarawak Energy’s approval processes, final award of the LTSA is expected by early 2017.  

At the signing event, Datuk Torstein said: “The new and advanced technology will generate electricity at a higher efficiency and output, enabling us to meet growing demand of Sarawak’s organic load.  We will ensure that the plant will be effectively and safely operated through the LTSA which is crucial for the long term operational maintenance of the plant.”

The LTSA will ensure efficient performance of the power plant and ensure continual support from the OEM contractor.  It also provides access to the latest improvements and upgrades in Combined-Cycle Gas Turbine from the OEM and ensures knowledge transfer from the OEM to the plant’s O&M personnel.  

Sarawak Energy is developing gas-powered generation projects over the next 5 to 10 years with a two-phase plan to raise output and strengthen their gas generation mix by an additional 1,600MW. Following the 400 MW Tanjung Kidurong (Bintulu) Power Station; phase two will see the development of a new 1200MW gas-power plant at Samalaju Industrial Park.

Currently, about 15 percent of Sarawak’s power generation is from its Bintulu and Miri gas-powered plants and 10 percent from coal resources. About 75 percent of Sarawak’s current power is derived from the hydropower plants at Murum, Bakun and Batang Ai HEPs.

In the selection of contractors, a comprehensive procurement process was undertaken in accordance with Sarawak Energy’s procurement procedures and in alignment with recognised industry best practices to identify the tender offer representing best value whilst maximising local content and knowledge transfer to local companies.

“In Sarawak Energy, we treat our contractors not just as vendors, but as business partners.  We require our partners to execute projects in a professional manner and seek our assistance at an early stage should they encounter any challenges to ensure the project is implemented smoothly and successfully,” added Datuk Torstein.