SET-listed Ratchaburi Electricity Generating Holding Plc (RATCH), Thailand's biggest private power producer, has formed a joint venture to invest in the second phase of a nuclear power project in China.
Chief executive Rum Herabat said the company has teamed up with China General Nuclear Power Corporation (CGN) and Guangxi Investment Group to establish Guangxi Fangchenggang Nuclear Power (II) Co.
Ratch holds a 10% share in the joint venture, with CGN having 51% and Guangxi Investment 39%.
The Fangchenggang (II) power plant is located in China's southern region of Guangxi, 45 kilometres from the Vietnamese border.
Ratch is investing 7.5 billion baht in the project, which is due to start commercial operations in 2021. It will have a total value of about 200 billion baht.
"We expect to learn from our partner CGN, which has expertise in nuclear power," Mr Rum said. "That's a major reason we finally agreed to partner with the project."
CGN has 16 nuclear power plants in China, running at a combined 17.1 gigawatts or 60% of China's generating capacity.
The Chinese company has another 11 nuclear power plants under construction and is likely to start operations soon for a total generating capacity of 13.6GW.
CGN has also invested in renewable energy projects including solar farms and wind farms in Asia and Europe.
"Nuclear power is the answer to help solve a possible supply shortage in the future. That's why we chose to join with CGN," Mr Rum said.
"However, we must understand that nuclear power has not yet been accepted by Thais. We are investing somewhere else to make sure we have certain experience and that one day we can explain to Thais that Thailand could be suitable for nuclear power."
Mr Rum said the Fangchenggang project was divided into three phases.
The first phase, which is already completed, consists of the first and second units, while the second phase consists of the third and fourth units, whose construction started last month.
"We're interested in joining the Fangchenggang (III) project, which would mean increasing our stake to more than the current 10%," Mr Rum said, adding that Ratch would wait to see returns from the second phase before deciding.
He said Ratch had set aside an investment budget of 10 billion baht for 2016 excluding mergers and acquisitions.
Meanwhile, Hemaraj Energy Co, a subsidiary of SET-listed Hemaraj Land And Development Plc (HEMRAJ), has signed a joint-venture agreement with Gulf MP, itself a joint venture between Gulf Energy Development Co and Mitsui & Co, to develop five small power plant (SPP) cogeneration projects.
David Nardone, president and chief executive of Hemaraj Land, said Hemaraj Energy owned 25.01% and Gulf MP 74.99% of each project. Total investment for the five projects is 34 billion baht, with generating capacity of 120-130 megawatts each.
Two SPPs will be located in the Hemaraj Eastern Seaboard Industrial Estate and the other three in the Eastern Seaboard Industrial Estate, both in Rayong.
"These important investments are aimed at ensuring reliable power generation for our industrial clients, enabling their operations to run smoothly," Mr Nardone said. "This will continue to make Thailand attractive to local and foreign investors."
RATCH shares closed yesterday on the SET at 48 baht, unchanged, in trade worth 16.6 million baht.
HEMRAJ shares closed at 4.36 baht, unchanged, in trade worth 1.75 million baht.