Archive for April, 2011

Deal likely by Federal Govt, Sarawak on tariffs

Posted on April 30, 2011. Filed under: Energy |

-The Star-

PETALING JAYA: The Federal and Sarawak Governments are believed to have struck an agreement on power tariffs for the Bakun Dam project early this week, sources said.

“The rate is likely between the state utility firm Sarawak Energy Bhd’s (SEB) offer for a starting tariff of six sen per kilowatt hour (KwH) and the request from Sarawak Hidro Sdn Bhd, the owner and developer of the Bakun Dam, for around seven sen per KwH,” said the source, declining to eleborate.

This places the valuation of the RM7.46bil Bakun Dam project at RM6bil to RM8bil.

“Things are progressing,” said the source, adding that the power purchase agreement (PPA) would likely be signed in about two months.

However, the talks are currently just centred on the PPA and not on SEB’s earlier proposal for a 30% stake in the 2,400-megawatt (MW) project.

“There is no mention of the proposed joint venture yet,” said the source. “Eventually, that will come through but at the moment, both parties cannot cloud the issues.

“The state government is asking for a low tariff which will result in a low valuation and, therefore, low entry point for their joint venture. That doesn’t seem fair,” said the source.

StarBiz had earlier reported that SEB was believed to have proposed to take up a 30% stake for RM1.3bil cash in the Bakun project and this will likely be in the form of equity of RM700mil and shareholders’ loan of RM650mil.

At seven sen per KwH, Sarawak Hidro’s valuation is in line with the findings of a recent study by PwC, believed to be commissioned by the Finance Ministry, which valued Bakun at RM8bil to RM10bil.

However, based on SEB’s offer of six sen per KwH, which will result in a valuation of RM6bil, it is believed that the valuation of Bakun will go down below its debt of RM5.75bil.

“We expect closure of the matter soon,” said Chris Eng, head of research at OSK Securities. “Salco is expected to sign the PPA before year end.”

“With all the smelters and other users coming up, there should be sufficient demand for power from Bakun,” he added.

The Bakun Dam is ready to supply 300MW in about three months while SEB has signed term sheets with four companies Press Metal Bhd, OM Materials, Asia Minerals Ltd and Tokuyama Corp for the supply of 1,300MW for their upcoming plants.

On Thursday, an agreement was signed between Gulf International Investment Group Holdings Sdn Bhd and Aluminium Corp of China to develop a US$1.5bil aluminium smelting plant in Sarawak.

The plant, Smelter Asia, is targeted to take 600MW initially for production of 370,000 tonnes.

Another big smelting plant, Sarawak Aluminium Smelting Sdn Bhd to be set up by Cahya Mata Sarawak Sdn Bhd and Australia-based Rio Tinto Alcan, requires 900MW to 1,200MW for an annual capacity of up to 720,000 tonnes.

Press Metal, which owns and operates an aluminium smelter in Mukah, will invest RM5bil in a new smelter plant with an estimated production capacity of 240,000 tonnes in the Samalaju industrial estate. The group, which will have a total production capacity of 360,000 tonnes, sold a 20% stake in Press Metal Sarawak to Japan’s Sumitomo Corp last month.

“However, the question is whether we really want to proceed with this plan. Smelters, which are often automated, are heavy consumers of electricity and pose environmental concerns.

“It would appear that Malaysians will continue to subsidise such industries,” Eng opined.

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Rare earth project: Perak terminates MoU

Posted on April 29, 2011. Filed under: Pollution |

Free Malaysia Today

The deal with the Hong Kong-based company is cancelled because it did not receive authorisation from the state government.

KUALA LUMPUR: The Bukit Merah rare earth project is effectively called off with the termination of the Memorandum of Understanding (MoU) between the Perak State Development Corporation (PKNP) and the Hong Kong-based company Commerce Venture Manufacturing (CVM) Minerals Ltd.

The Perak government today announced that it would terminate the MoU with immediate effect.

State executive councillor and Sungai Rapat MP Hasmidah Osman said that the MoU “did not receive authorisation from the state government”, and hence all proceedings would be halted and the MoU rendered void.

“The Perak government made the decision to terminate this MoU in a meeting held earlier this evening,” she told FMT.

She promised that the state government would not give approval to such a project, as greening Perak was one of its primary concerns.

She also said that the MoU was a “low-level” agreement, given the fact that Menteri Besar and PKNP chairman Zambry Abdul Kadir had no knowledge of it.

FMT reported earlier in the week that the Perak government has signed a MoU with CVM in relation to “the establishment of a joint venture in Malaysia for the purposes of the exploration and mining of rare earth and other potential minerals and activities” in Bukit Merah.

Warning from MB

CVM, via its subsidiary CVM Metal Recycle Sdn Bhd, submitted its application for a mining licence to the state Land and Mineral Office on April 18 to conduct rare earth exploration on an area of 250 hectares – nearly six weeks after the environmentally hazardous Lynas rare earth project in Kuantan was publicised.

PKNP, the development arm of the state government, has a 4.73% stake or 135,300,000 shares in CVM Metal Recycle.

However, PKNP CEO Samsudin Hisham assured locals that it was merely a feasibility study.

CVM could not be reached for comment despite repeated phone calls.
Meanwhile, Bernama reports that Perak Menteri Besar Dr Zambry Abdul Kadir is disappointed with PKNP for signing the MoU without notifying the state government.

“I would like to warn other agencies wishing to sign any form of MoU to notify the state government first… even though it is not a legal binding contract or just a mutual understanding.

“Matters that are sensitive, and involving government policies, should be relayed to the state government first,” he told reporters here today.

He was commenting on a controversial report posted on FMT which stated that the Hong Kong company and the Perak government had agreed to explore and mine for rare earth in Bukit Merah near here.

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Malaysian parliament approves feed-in tariffs

Posted on April 29, 2011. Filed under: Energy |

-Solar Server-

In its latest session ending April 28th, 2011, the Malaysian parliament passed legislation to create a system of feed-in tariffs for the nation, covering technologies including solar photovoltaics (PV).

The program is scheduled to be implemented by the third quarter of 2011, and contains targets for specific technologies by year, including a set-aside for PV projects smaller than 1 MW in size.

“We’ve studied similar mechanisms in other countries and made comparisons with the ones adopted in developed countries,” stated Malaysia’s Energy, Green Technology and Water Minister Datuk Seri Peter Chin Fah Kui.

“And we feel that the feed-in tariff system is good and suitable for our country.”

Tariffs include bonus for rooftop, BIPV, locally made modules

Tariff levels are set between USD 0.402/kWh for PV plants smaller than 4 kW, to USD 0.278/kWh for system 10-30 MW in size. Bonuses are included for rooftop PV, BIPV, locally produced modules and locally produced inverters.

Annual targets for solar photovoltaics start at 29 MW in 2011 and reach 580 MW in 2030.

Malaysia has attracted a significant amount of solar photovoltaic manufacturing in recent years, and is the location of thin-film industry leader First Solar Inc.’s (Tempe, Arizona, U.S.) greatest manufacturing capacity.

Fourth Asian nation to create FIT system

Malaysia is the fourth Asian nation to implement a feed-in tariff (FIT) system, following Japan, Taiwan and Thailand. Japan’s system applies only to solar photovoltaics and pays only for excess generation.

Other eligible technologies in Malaysia’s program include biomass, biogas and small hydro. The program’s annual targets culminate in a goal of 7.09 GW of generation from all eligible technologies in 2030.

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Malaysia needs to revive Sarawak hydropower plans – Tenaga Chairman

Posted on April 29, 2011. Filed under: Energy |

-Reuters-

* Malaysia faces rising coal prices and depleting gas reserves

* Hydropower plants in Sarawak could yield up to 28,000 MW

* Nuclear power cannot be ruled out, but plans likely to be delayed

By Francis Kan

SINGAPORE, April 29 (Reuters) – Malaysia needs to revive plans to transmit hydro-generated electricity from the resource-rich state of Sarawak to the rest of the country to diversify its energy mix, said the chairman of state utility Tenaga Nasional Berhad on Friday.

The Southeast Asian country faces the twin challenges of rising coal prices and fast-depleting gas reserves. The two fossil fuels make up almost 95 percent of the Malaysian peninsula’s generation mix, with hydropower accounting for another 5 percent.

“The prospect of transferring future hydro-electricity to the peninsula has to be revived, especially with concerns over nuclear power” said Tenaga Chairman Leo Moggie at an industry event in Singapore.

An earlier plan to build a 2,400 MW hydro-electric dam at Bakun in Sarawak to transmit power to the Malaysian peninsula, will now be used solely for Sarawak’s power needs. [ID:nL3E7ES0B8]

However, other hydropower projects with a potential of up to 28,000 MW could be developed in Sarwak to feed the peninsula, said Moggie.

“In terms of practical development it may be less than 28,000 MW, but it is still very substantial,” he said.

Tenaga announced in 2009 that it will be part of a consortium to build a $2 billion submarine cable carrying electricity from Sarawak on Borneo to the Malaysian peninsula.

The company, which owns more than half of the total generation capacity installed on the Malaysian peninsula, reported a 37 drop in its second-quarter net profit last week and warned of a difficult year on soaring coal prices and insufficient gas supply. [ID:nL3E7FL0CP]

Coal prices have risen more than 20 percent to an average of $103.8 per tonne in the second quarter from the first quarter.

Moggie also said that Malaysia needed to invest in liquefied natural gas (LNG) import facilities to help reduce dependence on coal. The country’s first LNG import terminal is set to start operations in August next year.

Nuclear power is also an option, though public opinion following the disaster at the Fukushima plant in Japan means Malaysia’s aim of having its first nuclear plant operating by 2021 faces hurdles, Moggie said.

“The nuclear option cannot be totally ignored. It is not a question of technical issues but public perception,” he said.

(Reporting by Francis Kan)

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Malaysia’s World-class Meteorological Infrasructure Ensures National Security – Mosti

Posted on April 29, 2011. Filed under: Climate Change |

CAMERON HIGHLANDS, April 29 (Bernama) — Malaysia’s meteorological infrastructure is world-class and equipped to ensure national security and public safety, said Science, Technology and Innovation Minister Datuk Seri Dr Maximus Ongkili.

The availability of meteorological stations and a radionuclide station in the country has enhanced Malaysia’s capability to monitor and act early against any adverse impacts from environmental disasters, including the possibility of a nuclear fallout, he said.

“Of course the behavior of the natural environment is not always predictable by the tools of science, so it is important for any government to invest in science infrastructure and trained manpower to attain world-class technical capabilities,” he said when inspecting the Meteorological Services Department (MSD)’s meteorological station at Cameron Highlands, which also houses the radionuclide station operated by the Malaysian Nuclear Agency.

The MSD has two regional Global Atmospheric Watch (GAW) stations located in Cameron Highlands and Petaling Jaya, with a full GAW station situated in Danum Valley, Sabah.

The Cameron Highlands GAW station measures gases at a tropical semi- developed area, the Petaling Jaya station measures gases at a tropical urban area while Danum Valley’s station measures gases at tropical forests.

“The stations contribute to atmospheric monitoring of climate change at various levels of land use change including agriculture and commercial development,” he said.

Meanwhile, the radionuclide station RN42 further strengthens the country’s weather and environmental monitoring capabilities.

The RN42 station is established under the Comprehensive Test Ban Treaty Organisation on nuclear weapon, of which Malaysia is a signatory. It is one of the 80 radionuclide stations in the world.

“The RN42 station is equipped with facilities that have the capability and high sensitivity to detect the presence of the smallest amount of radionuclide (airborne radioactive particles).

“So far, detection shows that our radioactive levels are normal and safe,” he said.

–BERNAMA

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You are a liar, Nizar tells Zambry

Posted on April 28, 2011. Filed under: Pollution |

-Free Malaysia Today-

The former menteri besar accuses the Perak government of being arrogant for signing a MoU with the Hong Kong company for the rare earth project.

KUALA LUMPUR: Perak Menteri Besar Zambry Abdul Kadir came under fire today for claiming that he had been unaware of the rare earth deal between the state government and Hong Kong-based company Commerce Venture Manufacturing (CVM) Minerals Ltd.

His predecessor Mohd Nizar Jamaluddin said Zambry “is not telling the truth. As chairman of the investment arm, Perbadanan Kemajuan Negeri Perak (PKNP or Perak State Development Corporation), it is impossible he did not know. And if he truly doesn’t, he should give up before he destroys the state”.

Zambry has said that he was not aware of the Memorandum of Understanding (MoU) inked between the PKNP and CVM Minerals as it had been carried out “at agency level”.

Nizar, the Bukit Gantang MP, called the decision to sign the MoU as “simply arrogant” on the part of the state government.

“We learnt our lesson about the risks of rare earth in Bukit Merah back in the 1990s. The cleaning-up costing hundreds of millions is still going on… to allow this Hong Kong company to come back is just plain stupidity,” he said.

“They (state government) are doing it for investment purposes and to boost morale – to show that they can bring in investments. The state government does not know what it is doing,” he added.

Slamming Zambry for his “abuse of power”, Nizar reminded the state government that the federal government would have to give the final agreement at the end of the day.

“Investors who wish to park their interests in Malaysia must get the approval of the International Trade and Industry Ministry, the Malaysian Industrial Development Authority and, in this case, the Atomic Energy Licensing Board.”

He warned the state government that if the project was allowed to proceed, future generations would have to deal with the repercussions.

Penang Chief Minister Lim Guan Eng also criticised the state government for its action.

“How can the Barisan Nasional (BN) be trusted to ensure the safety of such a high-risk project when it cannot build a stadium without its roof collapsing or the roof of Parliament leaking?”

Blind pursuit

Lim condemned the state government for “secretly” approving the rare earth project, asking voters to restore Pakatan Rakyat rule as the latter would place more importance on the people’s health and public safety than on “the blind pursuit of corporate profits”.

“The people of Perak must quickly restore the Pakatan government to prevent this rare earth mines from operating in Perak,” he said in a statement today.

FMT reported yesterday that the Perak government has signed a MoU with CVM in relation to “the establishment of a joint venture in Malaysia for the purposes of the exploration and mining of rare earth and other potential minerals and activities” in Bukit Merah.

CVM, via its subsidiary CVM Metal Recycle Sdn Bhd, submitted its application for a mining licence to the state Land and Mineral Office on April 18 to conduct rare earth exploration on an area of 250 hectares – nearly six weeks after the environmentaly hazardous Lynas rare earth project in Kuantan was publicised.

(Caving in to public pressure, the federal government decided not to allow Australian mining giant Lynas Corporation Ltd to proceed with the refinery project in Gebeng, Kuantan, pending safety reports to be produced by an independent panel.)

PKNP has a 4.73% stake in CVM.

However, Perak Health, Local Government and Environment Committee chairman Mah Hang Soon said today that no approval had been granted to CVM and as far as he was concerned, it was just a MoU.

CVM could not be reached for comment despite repeated phone calls.

The first rare earth plant in Bukit Merah, under Mitsubishi Chemicals, closed in 1992 after years of protests from citizens.

The area is still undergoing a massive RM303 million clean-up helmed by Mitsubishi Chemicals.

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Perak says no to Bukit Merah rare earth plant

Posted on April 28, 2011. Filed under: Pollution |

-Free Malaysia Today-

The Perak government says the MoU was only for a feasibility study and it was inked by low-level officers.

KUALA LUMPUR: The Perak government will not allow a second rare earth plant to be built in Bukit Merah, executive councillor Hamidah Osman said today.

She said the Memorandum of Understanding (MoU) between Hong Kong’s Commerce Venture Manufacturing (CVM) Minerals Ltd and the Perak State Development Corporation (PKNP) was merely a “low-level” agreement.

“The MoU was just a feasibility study of the area. To be allowed to mine, they’d have to ask for authorisation from the state. This MoU is a low-level decision, they haven’t even presented the MoU to the state government.”

She said that CVM Minerals would not get authorisation for any rare earth project under any circumstances.

“We definitely wouldn’t agree, especially as we are trying to green the state. The MoU was never presented to us, and if it was, we would not be in favour of it,” she said.

She came to Menteri Besar Zambry Abdul Kadir’s defence, saying that despite being PKNP chairman, he was not responsible for the decision made.

“That would be the CEO’s jurisdiction.”

Hamidah, the Sungai Rapat MP, also told FMT that the state government intended to issue a firm directive saying that no MoU should be signed by any state-linked company without the approval of the state.

“I hope that nobody takes advantage of this as a political issue because as far as the state is concerned, our final word is no. The plant goes against our concept of making Perak a green state,” she said.

‘A 7% stake’

FMT reported yesterday that the Perak government had signed an MoU with CVM Minerals in relation to “the establishment of a joint venture in Malaysia for the purposes of the exploration and mining of rare earth and other potential minerals and activities” there.

CVM, via its subsidiary CVM Metal Recycle Sdn Bhd, submitted its application for a mining licence to the state Land and Mineral Office on April 18 to conduct rare earth exploration on an area of 250 hectares – nearly six weeks after the environmentally hazardous Lynas rare earth project in Kuantan was publicised.

PKNP has a 4.73% stake in CVM, although Hamidah claimed that it was actually a 7% stake.

The first rare earth plant in Bukit Merah, under Mitsubishi Chemicals, closed in 1992 after years of protests from citizens. The area is still undergoing a massive RM303 million clean-up helmed by Mitsubishi Chemicals.

Residents of Bukit Merah, which is situated in the outskirts of Ipoh, blamed the rare earth refinery for birth defects and eight leukemia cases within five years in a community of 11,000. Seven of the leukemia victims have since died.

Mitsubishi Chemicals also reached an out-of-court settlement with nearby residents by donating almost RM500,000 to the community’s schools, while denying any responsibility for the illnesses.

Bukit Merah is part of the area known as Belanja, which covers about 11,137 hectares in the Batu Gajah district and has a multiracial population totalling 26,211 people.

CVM Minerals has not commented on the issue, despite repeated calls.

Only for feasibility study

Meanwhile, PKNP CEO Samsudin Hisham said in a statement that the MoU was inked only to make way for a feasibility study of the area, to further explore the area and its mining viability.

He said that neither PKNP nor CVM had any intention of implementing a rare earth processing plant in Perak just yet.

“The MoU is only valid for six months, and void if there is no approval from any local authorities or if the project is not viable for implementation,” said Samsudin.

He also explained that the MoU was not binding, and that CVM would be bearing the costs of the feasibility study.

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Sarawak’s tropical log production falls

Posted on April 28, 2011. Filed under: Bio-diversity, Forestry/Wetlands, Water resource |

-The Star-

KUCHING: Sarawak’s tropical log production fell sharply this year, adversely affected by the ongoing flooding, or impoundment, of the Bakun hydroelectric dam in the upper Rejang River Basin in the central region.

Total production in the first quarter (Q1) of 2011 was 1.81 million cu m, down by some 28% from 2.53 million cu m registered in Q1 2010, according to Sarawak Timber Industry Development Authority’s (STIDC) latest figures.

Jaya Tiasa Holdings Bhd managing director Datuk Peter Yong said the Bakun dam’s impoundment had caused flooding of timber roads, thereby hampering the transportation of logs from several concessions in the Bakun area in Kapit Division.

He said major timber companies, like WTK Holdings Bhd and Rimbunan Hijau (RH) Group, were operating several logging licences in the Bakun area. Jaya Tiasa is controlled by the diversified RH Group.

The low log production in the first quarter was also due to the Chinese New Year break, according to Datuk Peter Yong.

The 2,400MW Bakun Dam’s impoundment started in October last year and the area to be flooded covers 690 sq km, which is about the size of Singapore. The dam’s developer, Sarawak Hidro Sdn Bhd, had earlier predicted that the entire flooding of the dam reservoir could take up to two years.

Sarawak Hidro expects wet testing of the first of the eight turbines to be carried out in the next few weeks when the reservoir’s water level reaches about 190m. The dam is scheduled to commercially produce its first 300MW by July this year.

Yong said that when the dam’s water level reached a certain level, barges could be used to transport the logs out of the Bakun area.

“The low log production in the first quarter this year was also due to the Chinese New Year break and bad weather in March,” he told StarBiz yesterday.

However, he expects log production to slightly improve in the next few months with anticipated better weather conditions that would faciliate timber harvesting activities.

Statistics show that out of the 1.81 million cu m of logs produced in the first three months,1.73 million cu m consists of hill species, with meranti contributing the bulk about 640,000 cu m, followed by kapur (78,570 cu m), keruing (60,800 cu m) and bindang (43,400 cu m).

The Bintulu region is the top log producer, contributing 715,500 cu m, followed by Sibu region (643,800 cu m), Miri region (361,200 cu m) and Kuching region (9,800 cu m).

Out of the 79,700 cu m of swamp species harvested in Q1 2011, more than 59,000 cu m was from Miri region and 10,200 cu m from Kuching region.

Sarawak’s log exports in Q1 2011 plunged to 783,800 cu m (worth RM438.8mil), which was about 27% lower compared to 1.07 million cu m (RM507mil) during the same period last year.

Based on the comparison figures, the average log export prices had jumped by 15% to RM559 per cu m (Q1 2011), from RM475.6 per cu m (Q1 2010).

The low production figure has directly affected export volume as the Sarawak government allows only 40% of total production to be exported. About 60% is reserved for local mills to be processed into plywood and other value-added products.

Yong said the significantly higher log export prices this year were due to tighter supply, coupled with a bigger demand, especially from Japan for the reconstruction of Sendai, a Pacific coastal town destroyed by a recent devastating earthquake and tsunami.

“After the earthquake, orders from Japan had surged,” he added. However, Yong is not sure whether Sarawak timber firms could fulfill these new orders.

Sarawak shipped more than 51,800 cu m of logs worth RM28.7mil to Japan in Q1 2011, down from 81,400 cu m in Q1 2010.

India remains Sarawak’s major logs buyer, absorbing more than 506,000 cu m (nearly 65% of the state’s total exports) valued at RM294mil in Q1 2011.

Taiwan imported more than 103,000 cu m worth RM58.3mil, while China bought 66,900 cu m valued at RM33.3mil from Sarawak in Q1 2011.

Sarawak also exported logs to Vietnam, South Korea, Indonesia, Thailand and Pakistan.

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Malaysian tribes fight to protect rainforests

Posted on April 28, 2011. Filed under: Forestry/Wetlands |

Al Jazeera

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Pahang guide on swiftlet industry soon

Posted on April 28, 2011. Filed under: Pollution |

-The Star- KUANTAN: Pahang will introduce its guidelines on the sustainable development of the swiftlet industry by the middle of the year.

State Local Government, Environment and Health Committee chairman Datuk Hoh Khai Mun said the guidelines were a combination of its rules launched in 2007 and those of the Agriculture and Agro-based Industries Ministry.

He said there was a need to make adjustments to the ministry’s guidelines due to the rapid growth of the industry in the state.

“We are getting input from industry experts and the Veterinary Services Department in drafting the guidelines,” he said on Tuesday.

Hoh said a meeting was held in February to sort out technical issues, such as enforcement work and legal action that could be taken by local authorities.

“We will call for a meeting next month to finalise the details and if things proceed as planned, the guidelines will be introduced by the middle of the year,” Hoh said.

He said although the state government realised the potential in the swiftlet industry, public health must remain top priority.

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