13 August 2012

Camco South East Asia to develop 2 megawatt biogas project in Malaysia

13 August 2012 - Camco International Limited (AIM: CAO), a global developer of clean energy projects and solutions to reduce greenhouse gas emissions, is pleased to announce the first biogas clean energy project for Camco Southeast Asia (“Camco SEA”). 

The 2MW biogas project, based at a leading palm oil mill in Palong, Pahang state, Malaysia, will use anaerobic digestion to recover biogas containing methane from palm oil mill effluent (“POME”). The project will be amongst the largest of its type to date to generate electricity for supply to the Malaysian national grid. 

Camco SEA has acquired the rights to develop the project through the acquisition of Biopower Climate Care Holding SDN Bhd a fully owned subsidiary of Rhodia Energy GHG (France). Camco SEA will continue the construction of the project, with completion of the plant expected in early 2013. Total costs anticipated to be incurred by Camco SEA in developing the project to completion, including the above acquisition, are anticipated to be approximately US$4 million. 

Waste, including POME, from the region’s 1,000 plus Palm oil plantations is a significant issue for plantation owners, local communities and the region in general and contributes significantly to total emissions. As a result, the Malaysian government recently introduced a renewable energy feed-in tariff to incentivise the conversion of waste into power and it is expected over the coming years that Palm oil producers will come under increasing pressure to reduce waste from their production processes. 

The project is being developed under a 13 year build-own-operate-transfer (“BOOT”) agreement with the mill owner commencing upon the plant’s completion. Under this agreement, the mill owner will provide sufficient POME feedstock free of charge covering the full contract period. Once operational, the plant will generate revenue from the sale of electricity to the grid and from the sale of carbon credits generated under the UN clean development mechanism. The mill owner will receive a portion of the power and carbon sales under a revenue share agreement. 

The electricity will be sold to the grid through a renewable energy power purchase agreement (“RE PPA”) to be entered into with one of the Malaysia utilities, under the renewable energy feed-in tariff which sets a guaranteed off-take price for the duration of the project. 

Kent Carter, Managing Director of Camco Southeast Asia said: “I am very pleased with our acquisition of the Palong biogas project, as it strengthens Camco SEA’s market position in the biogas development business, one of the fastest growing areas of renewable energy development in the region.” 

Scott McGregor, CEO of Camco said: “I am excited to see our strategy of developing and owning clean energy assets extending to South East Asia. Strategically the biogas industry in South East Asia is a key sector to reduce emissions across the region and with our experience and resources available globally we are well positioned to lead this sector.” 

Camco International Limited (Camco, AIM: CAO) is a global developer of clean energy projects and solutions to reduce greenhouse gas emissions with operations in the US, the UK, China, Africa, Russia and SEA. 

Source: Camco