Consortium Build-up
Financial Advisor
▼
Laos-based Client (Developer)
1. Narrowed down technical
pre-Feasibility Study consultants
2. Identified & approached strategic
partners (EPC + equity + debt)
Negotiated tender and finalized
exclusive EPC & equipment supplier
Laos-based Client (Developer)
Coal-Fired Power Project | Zoning
- The 1,800 MW planned coal-fired power plant will be located in a newly-created SEZ (special economic zone) in central Laos which will take advantage of the abundant water source for cooling of the plant and convenient transmission infrastructure into Thailand.
- Key consideration for site selection were economics of import vs domestic coal sources.
Select Project Information
| Indicative Project Costing: | Unit | Capacity | Price |
| Project Base Costs | MW | 1,800 | 2,700 |
| Pumping Station | KW | 900 | 4 |
| Storage Pond | M3 | 1,400,000 | 10 |
| Transmission Line 500 KV Double Circuit |
KM | 40 | 40 |
| Office & Accommodation | Lump sum | 1 | 2 |
| Utilities | Lump sum | 1 | 2 |
| Infrastructure | Lump sum | 1 | 10 |
| Contingencies 10% | 270 | ||
| Feasibility Studies and EIA | Lump sum | 1 | 7.5 |
| Engineering & Supervision | Lump sum | 1 | 22.5 |
| Total project cost (US$ MM): | 3,068 |
EPIC participated in the early-stage planning with the client, assisting in overall strategy formulation, potential partner identification, risk analysis, financial modeling and coordination work
| Target Returns: | Client in-House | Post-EPIC Review |
| Project Financial Internal Rate of Return (FIRR) | 9.2% | 11.5% |
| Equity Financial Internal Rate of Return | 11.3% | 14.9% |
Coal-Fired Power Project | Current Situation
Context
- The project was a priority for the client to implement due to the fact that it can utilize the existing dry-bulk terminal at a key (but under utilized) port in Vietnam and also the existing road network between the two countries, Laos and Vietnam. The Lao government still has at least 2,000 MW left to export under a quota signed to export 9,000 MW
- Thus far, Laos’ main power potential lies in hydro and most of the development has been geared towards this area. Hence, base-load power development such as thermal is a high priority.
- The project will be part of a new SEZ which will export the majority of the electricity to Thailand and the remaining for use domestically especially within the SEZ and other domestic users and will be included in the masterplan & feasibility studies of the SEZ.
- Due to the lack of significant sources of coal domestically, it is expected that coal will be imported from Indonesia via a port in central Vietnam.
EPIC’s Role
- Served as the exclusive financial advisor to the client, a large local conglomerate based in Laos.
- Responsible for overall pre-development phase counterparty approach and negotiations.
Key Services Performed
In order to push forward the project, EPIC assisted the client in the search for a potential partner that can among other things:
- Jointly apply for the investment license from the government.
- Contribute development expertise in coal-power sector.
- Provide financial resources both levered and non-levered, aka. equity which will be used for 2 broad purposes including funding working capital and actual construction of the project.
- Leverage world-class expertise in project/construction management.