Mitsui (Mitsui & Co.) today announced the go-ahead for a major new $1.6 billion project to build a gas fired combined cycle power plant in Rayong Province, Thailand.
The go-ahead follows the signing of a project financing agreement for the 2,500MW plant which will be built, owned and operated by a joint venture between Mitsui (30%) and major Thai private power company Gulf Energy Development Company Limited (70%).
The new plant is expected to start supplying electricity in 2023 under a 25-year long term contract with the Electricity Generating Authority of Thailand. Construction of the plant will begin July 2020.
The Japan Bank for International Cooperation (JBIC) is providing project financing for approximately USD208 million. The loan is co-financed by the Asian Development Bank (ADB), Export-Import Bank of Thailand (EXIM Thailand), Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation, Sumitomo Mitsui Trust Bank Limited, DZ Bank, the Oversea-Chinese Banking Corporation Limited and regional banks in Thailand covering approximately USD1.36 billion.
Yoshio Kometani, Executive Managing Officer of Mitsui & Co., said: "We are pleased to support Thailand in answering its growing needs for electricity, together with Gulf Energy. Along with our partners JBIC and other Japanese companies, we aim to continue contributing to the development of the country's infrastructure."
Reiji Fujita, President of Mitsui & Co. (Thailand) Ltd., said: "Sustainability is a key growth area for Mitsui and this latest major long-term investment supports Thailand's transition to harnessing cleaner energy sources. It is also in line with our strategy to grow our natural gas business as the greener fossil fuel and bridge to renewable energy."
The feedstock for the plant will come from domestic natural gas and imported liquefied natural gas (LNG), a business where Mitsui is already a global leader and looking to further expand.
Through its investment, Mitsui aims to solve the dual challenge of demands for more energy and cleaner energy. While the use of renewable energy is steadily expanding, LNG is seen as a current solution to this challenge as it releases lower amount of greenhouse gasses.
This will be the fourth major project to be developed jointly by Mitsui and Gulf in Thailand. The partners are building a similar 2,500 MW gas-fired power plant in Chonburi Province and operate a small-scale power plant, involving a combined capacity of 6,470 MW.
Mitsui also partners with Gulf on a natural gas distribution network to industrial estates in Thailand.
Mitsui & Co. (8031: JP) is one of the largest and most prominent global trading and investment companies. Founded in Japan in 1947, the Group maintains a unique, unobstructed view of international markets through its worldwide network spanning across 66 countries, with a diversified business portfolio stretching across six key sectors.
Working in partnership with many of the world's most prominent private companies, Mitsui & Co.'s outstanding long-term performance is founded on its core business areas of Energy and Resources, Machinery & Infrastructure, and Chemicals. These strong and expanding legacy businesses provide a stable platform across bold and increasingly innovative areas of Mobility, Healthcare, Nutrition & Agriculture, and Retail & Services.
Mitsui & Co.'s success is also founded on its adaptable approach to partnerships, which offers it unparalleled insights into the world's broad economic drivers. These insights enable Mitsui leaders to identify trends and opportunities for growth while driving effective collaboration across its businesses to harness synergies and realize additional value.