KUALA LUMPUR: Bank Pembangunan Malaysia Bhd (BPMB) today clinched a deal with Pulau Indah Power Plant.

Sdn Bhd (PIPP) to co-finance the development of a RM3.3 billion 1,200 MW combined-cycle gas turbine power plant project in Pulau Indah, Selangor.

The deal is for the financing, design, engineering, procurement, construction, installation, testing, commissioning, ownership, operation and maintenance of the power plant by PIPP.

The financing for the power plant will be provided by three financial institutions namely BPMB, Maybank Islamic Bhd (MIB) and United Overseas Bank (Malaysia) Bhd (UOBM) via a fresh commodity murabahah term financing-i facility amounting to RM2.7 billion.

Situated in Klang, Selangor, the project sits on 60 acres of reclaimed land adjacent to the Port Klang Free Zone which lies on the northern bank of Selat Lumut.

The site is accessible by road via Lebuhraya Pulau Indah, Persiaran Masjid Sultan and Jalan Sidang Adnan and is approximately thirty-five kilometres from Klang town.

Pulau Indah was formerly known as Pulau Lumut and most of the land mass has been developed for port facilities as well as for industrial estate.

The signing ceremony which took place in Selangor today was officiated by Selangor chief minister Datuk Seri Amirudin Shari and attended by Worldwide Holdings Bhd (WHB) chairman Datuk Nor Azmie Diron,

Ambassador of the Republic of Korea Lee Chi-Beom as well as representatives from the three financial institutions including BPMB.

BPMB president and group chief executive officer Arshad Mohamed Ismail said the power plant project has significant, economic, environmental and social benefits.

"Together with our co-financiers, we look forward to the successful development of the project," he said.

Arshad said The United Nations' Sustainable Development Goals, Mid-Term Review of the 11th Malaysia Plan and the Generation Development Plan 2020 - 2030 all outlined sustainable development objectives and mitigation of climate change.

"Therefore, as a development financial institution, BPMB's role in nation building and our continuous support towards the government's agenda will be emphasised through the power plant project," he said.

PIPP, which is 75 per cent owned by WHB and 25 per cent owned by Korea Electric Power Corporation, received a letter of award from the Suruhanjaya Tenaga on 10 September 2019 to undertake the power plant project.

The power plant project involves construction and development of a 1,200MW combined cycle gas-fired power plant and its related facilities in Pulau Indah, Klang, Selangor.

Meanwhile, on 7 August 2020, PIPP signed the power purchase agreement with Tenaga Nasional Bhd (TNB).

Whereby the sale of the power plant's entire daily available capacity and net electrical output to TNB has been contracted for a period of twenty-one years from the commercial operation date of the first generating block.