Bangladesh asks Malaysia to build its new $2.5bn coal power plant

Bangladesh has awarded a US$2.5bn project to build a 1,320-megawatt coal-fired power plant to Malaysia, in a government-to-government deal announced 20 July.

"It’s final. The Bangladesh Cabinet made the decision to award the project to the Malaysian Government," said Malaysia’s infrastructure envoy, Datuk Seri Utama S. Samy Vellu, reports Malaysian online newspaper, The Star.

"Now, a Malaysian consortium will implement the project but it will do a feasibility study first," Samy Vellu said.

In 2014, Malaysia and Bangladesh signed a memorandum of understanding to build the plant in Maheshkhali (pictured), in the Cox’s Bazar district near Chittagong, for the Bangladesh Power Development Board (BPDB).

The Malaysian consortium and BPDB would have equal equity shareholding in the power plant with a concession period of 21 to 25 years.

According to The Star, Samy Vellu said if the parties decided to go ahead with the project after the completion of the feasibility study, they will form a joint venture (JV) company and conduct international tender to appoint the engineering procurement and commission (EPC) contractor for the project.

Samy Vellu said the feasibility study was expected to take place within six to nine months, while completion of project documentation to achieve financial close would take up to a year. Construction would take four years.

Image: Scenic view of coastal Maheshkhali, in the Cox’s Bazar district of Bangladesh. The new power station is to be sited in the locality (Tanweer Morshed/Wikimedia Commons)

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