Geothermal Power Plant Tawau

Malaysia’s first geothermal electric power plant - environment-friendly energy.

Canadian expertise is being sought to help develop Malaysia's first geothermal plant in Tawau district.

In 2012 Vancouver-based Continental Energy Corporation (CEC) has inked a Sales and Purchase Agreement with the project developer Tawau Green Energy Sdn Bhd (TGE) to enable CEC to become a 10% shareholder in Tawau Green Energy.

Continental Energy Corporation had been actively involved in the oil and gas industry.

Continental Energy Corporation chief executive officer Richard McAdoo said the acquisition of a stake in TGE was a milestone for Continental, as it represented a step in their planned expansion into the renewable electrical power generation sector in a high-growth region.

The geothermal power plant in Tawau's Apas Kiri would be capable of generating over 100MW of electricity once fully completed.

Continental Geothermal Energy Project Receives US$ 11.5 Million Grant : http://www.marketwatch.com/

Malaysian Government Awards Grant for Geothermal Energy Project : http://www.azocleantech.com/

The Malaysian government awarded a grant of about $11.5 million to Tawau Green Energy Sdn. Bhd. for the development of a geothermal project in Sabah.

The Apas Kiri geothermal site is near the city of Tawau in the State of Sabah.
This geothermal project is Malaysia's first geothermal energy facility. It is expected to come online by early 2015 with a rated net capacity of 30 megawatts.

Tawau Green Energy will build, own and operate the geothermal facility which is expected to cost around $133 million.

The company has signed a power purchase agreement with Sabah Electricity Sdn. Bhd. Power supplied by the facility will be fed into the East Coast Sabah power grid.

Continental Energy Corporation, owns 10 percent of Tawau Green Energy

Proceeds from the grant will be used to pay for costs associated with constructing access roads and making related infrastructure improvements for the development of the facility.

The grant was formalized in a facilitation funds agreement which states that the funding will be disbursed by Bank Pembangunan Malaysia Berhad, a development bank owned by the Malaysian government.

The project has been registered and validated with the United Nations Framework Convention on Climate Change under its Clean Development Mechanism program and is enabled to earn certified emission reduction credits for its first 10 years of operation.

Sustainable Energy Development Authority (SEDA) - chairman, Tan Sri Dr Fong Chan Onn

The first phase of the project costing RM400 million by Tawau Green Energy Sdn Bhd (TGE) was expected to be ready by the first quarter of 2015 with a capacity of 30MW.

Tawau requires about 80MW of electricity to meet demand

Meanwhile, project director Ir Andrew Amaladoss said the government, through the Public Private Partnership Unit, Prime Minister’s Department had given a grant of RM35 million to build an access road to the site.

The second phase of the project, which would be implemented after the completion of the first phase, would be capable of generating 100MW of electricity.

The site, about 20km from Tawau, with an area of 12km square, was found by researchers from University Sains Malaysia, Penang and Universiti Indonesia who conducted a study in the area in 2008-2009.

Phase one of Tawau Green Energy Geothermal Power Plant involving generating capacity of 36MW is expected to be completed in 2015.

The power plant at Apas Kiri, will supply 30MW to the Sabah Electricity Sdn Bhd (SESB) grid.

The project reduce the utilization of fossil fuel for power generation in the Sabah in line with Malaysia’s sustainable development policy and global greenhouse gas emission reduction.

The process of producing electricity with a geothermal power plant is similar to other thermal power plants that use coal, oil or gas except that it does not require burning any fuel.

Instead, geothermal plant utilizes energy from the natural steam and hot water drawn from the geothermal reservoir, he explained.

The geothermal power plant is a form of green energy which does not require any fuel burning or combustion to produce heat or electricity.

It emits little carbon dioxide, no nitrogen dioxide and very low amounts of sulfur dioxide.

The project is estimated to cost RM419 million and it has also qualified to receive a grant of RM35million from the Private-Public Partnership Unit of the Prime Minister’s Department for the access road and water treatment plant.

Tawau Green Energy Sdn. Bhd. ("TGE") is a geothermal energy developer. On November 29, 2011, TGE entered into a Renewable Energy Power Purchase Agreement (the "PPA") with Sabah Electricity Sdn. Bhd. ("SESB") to supply a capacity of 30 megawatts of electrical power to SESB's East Coast Sabah power grid.

SESB is a utility owned 80% by Tenaga Nasional Berhad, the federally owned electrical generation authority and utility of Malaysia and 20% by the State Government of Sabah.

TGE is developing a volcano related geothermal resource known as "Apas Kiri" which is located in southern Sabah near the city of Tawau

Tawau Green Energy Sdn. Bhd. ("TGE") will build, own and operate the geothermal power plant and expects to construct it at an estimated total cost of 400 Million Malaysian Ringgit ("MYR") (approximately US$ 133 Million).

TGE plans to commission the plant by the end of 2014 and when completed, it will be Malaysia's first power plant fired by a geothermal resource.

The Renewable Energy Power Purchase Agreement (the "PPA") provides for a fixed purchase price by SESB of MYR 0.21 per kilowatt hour (approximately US$ 0.07) and a guaranteed off-take of all power the geothermal plant can produce for a fixed term of 21 years from first commercial operation. Over the 21 year life of the PPA, TGE expects to generate about US$ 328 Million in revenues at the PPA price. Additionally, TGE has applied for a Feed-In Tariff incentive from the Malaysian Government which if and when approved, would increase the overall revenue projection.

Tawau Green Energy Sdn. Bhd. ("TGE")'s Tawau geothermal power project has been registered and validated with the United Nations Framework Convention on Climate Change under its Clean Development Mechanism program and is enabled to earn certified emission reduction ("CER") credits during its first ten years of operations.

Each CER may be sold and traded on carbon credit exchanges such as BlueNext at a quoted market price (current spot CER price is euro 3.55 each).

When operating at its rated capacity of 30 megawatts, the power plant is expected to reduce CO2 emissions by 282,400 metric tonnes per year and earn the same number of CERs (1 CER = 1 tonne CO2 reduction). Under its agreement with a third party carbon credit solutions provider, TGE will be entitled to 75% of the CER revenue or about euro 750,000 per year at current CER spot prices.