Asiatic Group (Holdings) says its joint venture company, Maju Intan Biomass Energy Sdn Bhd (MJE), has entered into a renewable energy power purchase deal with Tenaga Nasional Bhd which will buy electricity generated from MJE’s 10 megawatt power plant located at Teluk Intan, Perak, for 21 sens/kWh (9 cents/kWh).

The agreement will be valid for a concession period of 21 years on a build-own-operate basis.

As previously announced on Oct 12, 2009, the group took a 30% stake in MJE through its wholly-owned subsidiary, Colben Energy Holdings (Maju Intan), alongside with local partners Messers Tekun Positif (M) Sdn. Bhd (30% stake), Tan Guan Hua Sdn Bhd (15%) and Wealthy Entity Holdings Sdn Bhd (25%).

MJE has been progressively managing the detailed design and engineering works in preparation for the construction of the power plant, as well as executing fuel supply agreements for the procurement of empty fruit bunches from palm oil plantations as fuel for the power plant.

The estimated cost of the project remains at about RM150 million, including all of the peripheral by-product processing facilities apart from the power plant facilities and infrastructure. The group’s expected cost of investment remains at about RM10 million.