China Holdings Inc. announced it has agreed to acquire Hunan Zhangjiajie Chalinhe Electric Power Co. Ltd., which is developing the 72-MW Chalinhe hydroelectric project on the Lishui River in China’s Hunan Province.
China Holdings, an energy, real estate, finance, and pharmaceuticals holding company, said July 30 its wholly owned subsidiary, China Power Inc., executed a definitive agreement to acquire Hunan Zhangjiajie Chalinhe for terms it expects to announce upon closing.
The first stage of Chalinhe, including three of its four 18-MW units, is expected to be complete in December. It is expected to generate 280 million kWh for sale under contract to China State Grid for 0.316 renminbi per kWh (4.2 US cents/kWh).
China Holdings said the project also has approval to trade carbon credits under the United Nations’ Clean Development Mechanism up to the full 72-MW capacity of the project. The project’s expected current annual revenues are expected to total US$12 million, with net income of about US$11 million.
Chalinhe is to feature a 95-meter-tall dam on the middle reaches of the Lishui. It is be one of 13 hydropower plants in the plan for the Lishui.
China Holdings said in May that it and China Power would focus on investing in hydropower plants and companies. It said the companies intend to acquire 150 MW to 1,000 MW of hydropower annually for up to four years by mergers and acquisitions and by joint venture partnerships. (HNN 5/30/07)