Published August 13, 2008

Tenaga keen to buy stake in dam, cable project

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(KUALA LUMPUR) Tenaga Nasional Bhd has expressed interest in buying a stake in Bakun, Malaysia's biggest hydroelectric dam, after Sime Darby Bhd dropped its bid for a share in the project.

The state-controlled utility is also keen to undertake an undersea cable project that will transmit power from Sarawak, where the dam is being built, to Peninsular Malaysia, Tenaga CEO Che Khalib Mohamad Noh said yesterday.

Sime Darby, the world's biggest publicly traded palm oil producer, said in June it will focus on its plantation business and won't buy a stake in Bakun. It also cancelled a plan to develop the submarine cable, raising concerns for the project's viability.

Peninsular Malaysia will need to tap Sarawak's hydro resources to meet its future electricity demand, he said. 'Since Sime is not interested, it is only logical for Tenaga to offer the construction of the undersea cable so as not to further delay the project.'

Tenaga's proposal is being examined by the Economic Planning Unit, a government agency in charge of development projects, Second Finance Minister Nor Mohamed Yakcop said yesterday.

He reiterated that the RM22 billion (S$9.3 billion) Bakun project will be completed as planned. The dam is slated to be ready in 2010, while the submarine cable is expected to be laid by 2013. -- Bloomberg