Gunkul Engineering Plc, a SET-listed engineering service and renewable power operator, has suspended its plan to build a wind farm on Sor Por Kor land in Saraburi until it gets a clear resolution from the authorities after a recent court ruling.
Chief executive Sopacha Dhumrongpiyawut said Gunkul was due to do a study of the wind strength in the area and was in talks with the land owner on whether it should lease or buy the land.
Tentatively, the wind farm would have power-generating capacity of 60-90 megawatts and need 4.8-7.2 billion baht of investment budget, excluding land leasing or purchasing costs.
"We are testing the power of the wind in the area since the energy policymakers announced a plan to allow the development of new wind farms with a total capacity of 1,200MW years ago. So, we decided to prepare the land before being granted the licence to develop the wind farm," Ms Sopacha said.
Gunkul was among several wind farm developers unsure about going ahead with their projects after one developer had his right to construct a wind farm revoked by the court.
The Supreme Administrative Court ruling last week deemed that renting Sor Por Kor land to build a wind farm in Chaiyaphum was a misuse of the land, which is designated for farming purposes. That has forced the investors to cancel the project, raising concerns among developers whose wind farms are located on Sor Por Kor land.
The Energy Regulatory Commission (ERC) has also suspended approvals for power purchase agreements of 11 wind farm projects located on Sor Por Kor land, mostly in Nakhon Ratchasima and Chaiyaphum provinces, with a combined power-generating capacity of 700MW.
However, Ms Sopacha said the suspension of the new wind farm is unlikely to have any impact on its five-year plan, which aims for total renewable power-generating capacity of 1,000MW.
This year, Gunkul seeks to raise its power-generating capacity to 230MW, up from 171MW last year.
Yesterday, Gunkul has signed a credit facility agreement with Siam Commercial Bank of 3.11 billion baht to finance its new 50MW wind farm in Nakorn Ratchasima, Mittraphap Wind Farm, due to start operation in the fourth quarter next year. Gunkul also signed a construction contract with Zhongnan Egineering Corp and Sinohydro (Thailand) Co for the Mittraphap.
The wind farm project, Gunkul's third, will not be adversely affected by the Sor Por Kor land dispute since it is built on the normal multi-purpose land certificate.
The company's first wind farm, named Wayu Wind Farm, has 60MW capacity and is already in operation, while the second, Saranrom Wind Farm, has 60MW capacity and is under construction. Its operation is due in the last quarter of this year.
Gunkul's chief finance officer Thitipong Techaratanayuenyong said revenue from power sector this year is expected to grow by 30% from last year's 3 billion baht. Earnings before interest, tax and depreciation amortisation this year from the sector will be at around 80%, up from 60% last year.
He said Gunkul is ready to expand capacity of its renewable projects in Thailand and overseas.
For domestic market, it is eyeing renewable power-generating capacity of 15% of the total capacity of 1,000MW open for bidding, including wind, solar, biomass and biogas, he said. Overseas, it hopes to develop a solar farm in Japan with 500MW in the next few years, and business possibility in Malaysia and Vietnam.
GUNKUL shares closed yesterday on the SET at 5.45 baht, up five satang, in trade worth 83.6 million baht.