Poipet PPSEZ Co Ltd, a wholly-owned subsidiary of Phnom Penh SEZ Plc and operator of the soon to be completed Poipet Special Economic Zone (Poipet PPSEZ), signed a memorandum of understanding yesterday with a leading Thai energy provider to supply power to the 66-hectare industrial park.
The agreement signed with B Grimm Power Pcl, a member of Thai B Grimm Group, offers the exclusive right to develop and operate power transmission infrastructure through a power purchase agreement for Poipet PPSEZ, which is in late-stage construction on the outskirts of Poipet. It also guarantees the future right to construct power generation facilities for the industrial zone.
Both parties will now conduct a feasibility study for the construction of an initial 12.4 kilometre, 22 kilovolt transmission line connecting the SEZ with Poipet’s power substation, the two companies said during the signing ceremony.
According to Preeyanart Soontornwata, president of B Grimm Power, the initial investment amount will be between $2 million and $3 million, though the company will provide more capacity according to the needs of the zone’s future tenants.
“For this particular project, the budget is not so big and for the first phase it is about $3 million only, but in the near future we expect that we can expand the substation and also generation [capacity] to provide more reliable and more effective energy,” she told reporters after the agreement signing.
Lim Chhiv Ho, chairwoman of Phnom Penh SEZ Plc, said the power agreement would allow for greater development of high-skill manufacturing, such as electronics, in the Poipet PPSEZ. She added that the company was eyeing investment from energy-intensive Japanese manufacturers, many of which already operate out of the Phnom Penh SEZ.
“As Cambodia, through its industrial development policy, aims to attract more manufacturers that produce high value-added products such as vehicle assembly parts, electronics ... and electrical assembly parts, these manufacturers cannot operate with unstable or disruptive electricity supply,” she said during the ceremony.
Representatives of both companies emphasised their optimism for the future of Poipet as an industrial hub given its location on the Thai border and its proximity to Thailand’s largest seaport, Laem Chabang.