MUSCAT - The US-based multinational, Public Service Enterprise Group (PSEG), is set to sell its entire holding in Dhofar Power Company (DPC) to a consortium of Malaysian and GCC investors, a company statement submitted with the MSM said. The full control of Dhofar Power's largest shareholder Salalah Power Holding, a subsidiary of PSEG Salalah, will be transferred to Oman Technical Partners Limited (OTPL) on satisfaction of certain conditions. OTPL is 43.4 per cent owned by Malaysia-based Malakoff Berhad and the remaining stake equally held by Dubai-based GCC Energy Fund and Darbat Power of Oman. According to sources, PSEG has 46 per cent holding in 242-MW independent power company. DPC did not disclose the cost of acquisition.
An agreement has been signed for selling the stake and the proposal has been communicated to all parties concerned, including the Authority for Electricity Regulation, Oman Power & Water Procurement Company and lending institutions. After completing the acquisition, Teknik Janaquasa Sdn Berhad, a subsidiary of the Malaysian energy firm, will enter into a technical and management services agreement with DPC.
Teknik Janaquasa operates Malakoff's majority-owned power plants, which have a combined generation capacity of 5,000 MW in Malaysia. Also, Finland-based Fortum Power and Heat OY will enter into another pact with DPC for power transmission and distribution. Fortum Power supplies electricity to 1.3 million customers spread in Finland, Sweden, Norway and Estonia. In anticipation of the two agreements, the company is not planning to renew its technical and management services agreement with PSEG Global LLC, which expired in August 2006.
PSEG offered 35 per cent of its stake in DPC to the public through an initial public offering last year, which was in line with its commitment with the government. The issue had evoked an overwhelming response from investors, which resulted in the company mopping up around RO 80 million from the market. DPC is expected to eventually take over the assets of the Ministry of Housing, Electricity and Water in Dhofar region. It is the only fully integrated energy utility with a right of generation, distribution, billing and collection.
By A E James
© Oman Daily Observer 2006
