QTC entered into a Memorandum of Understanding (MOU) to explore an opportunity to invest in hydropower projects in Lao PDR

Monday 25 September 2017 10:40
Mr. Poonphiphat Tantanasin the Chief Executive Officer of QTC Energy Public Company Limited or "QTC" disclosed that QTC has entered into a Memorandum of Understanding with Chaleun Sekong Group Company Limited ("CSG") a Lao company experienced in the development of hydropower projects and is an owner of several hydropower projects in Lao PDR. CSG agreed to grant QTC an exclusive right to study and conduct due diligence to explore an opportunity to invest in 2 hydropower projects of an aggregated installed capacity of 164 Megawatts in Lao PDR. CSG agreed to not engage or enter into an agreement, whether directly or indirectly, with any third party during the exclusivity period. However, QTC is not obliged to invest in the two projects as abovementioned since the MOU is only a preliminary agreement to explore an opportunity to invest.

Moreover, the exploration of the opportunity to invest in both hydropower projects is in line with the business plan of QTC to extend its business to electricity generation and distribution business to allocate risk of relying on source of income from manufacturing and distributing electricity transformer business. Currently, QTC has been following the plan consecutively and has invested in two power plant projects of the electricity generation capacity of 33.5 Megawatts aggregately, calculated based on QTC's shareholding in the project, comprising an investment in the solar power plant project in Minbu, Myanmar with the electricity generation capacity, under the power purchase agreement, of 170 Megawatts (or approximately 22.5 Megawatts, calculated based on QTC's shareholding in the project) which is expected to commence its commercial operation in 2018 and L Solar 1 solar power plant project in Prajeenburi Province with the electricity generation capacity, under the power purchase agreement of 8 Megawatts which has been commenced its commercial operation since 2011. QTC has acquired shares of L Solar 1 from the existing shareholders since 20 September 2017 and it is expected that QTC will receive more income from the operation of L Solar 1 solar power plant project.

Furthermore, in the six-month period of the year 2017, income from electricity transformer business, which is the main business of the company, has become more profitable compared with the same period in the year 2016 as a result of a higher demand for electricity transformer in the market. It is expected that the upward will continue. QTC believes that the growth of electricity transformer business together with the expansion of business to electricity generation and distribution business will significantly support sustainable growth of QTC as well as being beneficial to any interested persons of all sectors as intended by QTC.