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The Nation: Ratchaburi power plan
- Subject: The Nation: Ratchaburi power plan
- From: suriya@xxxxxxxxxxxx
- Date: Wed, 18 Feb 1998 17:55:00
Headlines
Ratchaburi power plant in
for delay
Egat officials confirmed yesterday that
completion of the massive Ratchaburi
power plant will be delayed, threatening the
country with blackouts and raising new
questions about the timetable for the
Yadana gas pipeline.
Siridhat Klanklamdee, Egat's assistant
governor, said construction of the first
gas-fired unit, which is due to burn natural
gas delivered by the pipeline from Burma
starting in July, is likely to be delayed by
about one month because of
slower-than-expected progress from
contractors building the plant.
However, a senior Egat official said the
delay could last around three months
because of the recent Cabinet resolution to
comply with the International Monetary
Fund's balanced budget policy for all state
enterprises, which has forced Egat to
postpone payments to suppliers and
creditors for many projects, including the
Ratchaburi plant.
''Amid the slowdown in electricity demand,
Egat could not convince the government to
complete the power plant on time,'' said the
Egat source, who asked to remain
anonymous.
The issue of Egat's financial liquidity
problems was raised several days ago by
the Kalayanamitra Council's Pipob
Udomittipong, a pipeline critic who testified
before the national committee set up to
review the pipeline project. Pipob said
Egat would not be able to pay off its
suppliers until the new fiscal year starts
after Sept 30, and predicted the first
200-megawatt combined-cycle unit of the
Ratchaburi plant will not be ready to receive
gas until November.
The delay has created new uncertainties for
the Petroleum Authority of Thailand's
pipeline project, which is currently being
built through a pristine forest area in
Kanchanaburi inhabited by several rare and
endemic species. Critics have called for its
route to be altered, which could become
more feasible now that the power plant
destined to use the gas won't be ready on
time.
The PTT's reaction to Egat's news
yesterday was relatively mild. The PTT has
in the past responded to calls by
conservationists to delay the project by
insisting it must be completed by July 1 or
the company would have to pay fines as
high as Bt100 million per day.
Jira Chomhimvet, the PTT official who
heads local operations for the project,
revealed yesterday that while the PTT
would indeed have to pay for the gas
Burma is supposed to deliver even if the
PTT can't receive it, the losses would be far
less than suggested.
''We can eventually claim the gas we pay
for once the power plant is finished and the
country is ready to take it,'' Jira said. ''In the
end, the only money we will lose will be the
interest.''
The senior Egat official also disclosed
yesterday that executives from Egat and the
PTT will soon go to Burma to ask Burmese
authorities to relax the penalty charge
should the PTT be unable to receive the
Burmese gas on schedule.
According to the source, the extra charge
will be around Bt150-Bt170 million a month,
depending on the exchange rate at the
time. He confirmed that the charge is not
simply a penalty fee but rather an advance
payment for the gas since some flexibility is
allowed under the gas sales contract.
He said Egat will help the PTT convince the
Burmese about the reasons why the PTT
cannot receive gas on time, even though
Egat is not required to pay the PTT if the
power plant is delayed.
This contradicted comments made at the
pipeline committee meeting by Egat's
Siridat, who said Egat had signed a
''take-or-pay'' agreement with the PTT, and
so must pay for the gas even if it cannot
take it.
Siridat said postponement of the
commissioning of the Ratchaburi power
plant will cause electricity brownouts and
blackouts, each minute of which will cost
the country Bt1.2 million.
''The economic cost will be doubled if the
blackout occurs in big cities or industrial
zones,'' he said.
Without the Ratchaburi plant, the national
electricity reserve capacity in 1999 will
stand at only 10.2 per cent, far lower than
the 25 per cent minimum requirement. The
current reserve capacity is 12 per cent,
according to the assistant governor.
''We are well aware of the consequences
[of the delay] and are speeding up
construction of the project to try and finish it
on time,'' he said.
Meanwhile, the national committee
reviewing the pipeline project wound up its
information-gathering yesterday and will
now deliberate on recommendations to
offer to the prime minister next week.
Testifying on the issue of safety concerns,
the PTT's Vorachai Piyasuntaravongse told
the committee that the petroleum firm has
already paid insurance fees -- totalling
US$10 million for the pre-commissioning
period and US$30 million for the
post-commissioning period -- to protect the
lives of contractors, workers and people
living along the pipeline route.
The insurance also covers sabotage and
damage to villagers' houses. If the
businesses of people living near the
pipeline are affected by the existence or
construction of the pipeline, they can also
seek compensation, he said.
BY WATCHARAPONG THONGRUNG and
PENNAPA HONGTHONG
The Nation