ITD looks to sell stakes to investors
Italian-Thai Development Plc (ITD) expects to conclude loan agreements with creditors to finance its Dawei mega project in Burma within this year.
A map of Southeast Asia and trade and transport routes out of Dawei forms the backdrop as Mr Premchai discusses progress of the Dawei project at a briefing yesterday.
Thailand's biggest construction company is also inviting both local and foreign investors to acquire up to 49% of the project developer Dawei Development Co (DDC), which is now wholly owned by ITD.
So far, more than 10 investors have expressed interest to become strategic partners, ITD president Premchai Karnasuta said yesterday.
They include PTT International, Electricity Generating Co (Egco) and Ratchaburi Electricity Generating Holding Plc, which are interested in industrial projects to be developed in Dawei.
"The project is so huge and it must have one company to take the lead for its development. That's why ITD want to maintain no less than 51% in DDC," Mr Premchai said.
The company will hold a roadshow in Japan next week to brief investors about Dawei, followed by events in Korea, China and India later, he said.
"We are inviting strategic partners to join us from now on," he said. "We are going to arrange charter flights for investors who want to visit the site."
Siam Commercial Bank, the financial adviser to the project, has been working on details of project financing to finalise the plan within two months.
Several international financial institutions have expressed readiness to support the project, seeing it as a key link in an economic corridor linking Vietnam, Cambodia, and Burma, he said.
The development area has a total population of 10,000, and Burmese officials have pledged that a relocation plan will follow World Bank guidelines.
The company initially expects to spend US$4 billion on infrastructures such as road and rail links and a port, and another $4 billion for infrastructure inside the industrial estate. Covering 250 square kilometres, the Dawei special economic zone (SEZ) is 10 times bigger than Map Ta Phut in eastern Thailand, Mr Premchai added.
International consultants have been hired to conduct detailed design studies for each investment project, including refineries and power plants. The studies will be finished this year.
"We will complete financial arrangements this year for construction which will start next year and finish by the end of 2015,"said Mr Premchai.
ITD is preparing to invest 2 billion baht in Dawei this year after spending 500 million on feasibility studies and road accesses to the site on the west coast of Burma.
The company has been granted a 75-year concession for the SEZ.
Dawei, 350 kilometres from Bangkok, is designed to be a western hub for Thai products to be shipped to Europe, the Middle East, China and South Asia.
Mr Premchai said the company was negotiating tariff rates with the Electricity Generating Authority of Thailand for electricity from a $5-billion 3,600- megawatt coal-fired power plant planned in Dawei. Another 6,000-MW plant would be built to serve demand at the site.
A refinery with capacity of 100,000 barrels per day will be built as ITD has already reached an agreement for gas from the Gulf of Martaban Gulf as a feedstock. An integrated steel plant, with capacity of 6 million tonnes a year of hot-rolled coil in the first phase, is also planned, with coal expected to come from Indonesia and Africa.
The Thai government has budgeted 55 billion baht to support the project to connect the Eastern Seaboard with Burma, including 30 billion for a highway and 25 billion for rail extensions, said Arkhom Termpittayapaisith, the secretary-general of the National Economic and Social Development Board.
Areepong Bhoocha-oom, permanent secretary of the Finance Ministry, said the Thai and Burmese governments had agreed on resolving double taxation to support investments in Dawei.
As well, the Asian Infrastructure Fund, which mobilises capital from central banks, could be a major financing source as the project will be a focus of Asean integration, he added.
Article Source: Bangkok Post, 9 June 2011