Malaysian conglomerate Sime Darby Bhd has won a US$4.28 billion undersea transmission cable contract for the 2,400-MW Bakun hydroelectric project, a Malaysian daily reported.
The cables would deliver power from Bakun, which is nearing completion in Malaysia’s Sarawak State on Borneo Island, to the power grid on peninsular Malaysia, home to the vast majority of Malaysians.
Sime would be partner with a unit of European engineer ABB, the world’s biggest maker of transformers, to carry out the project, the Business Times said January 17, citing unnamed sources. A Sime spokeswoman said she was in no position to comment on the report.
“Where the impact on Sime is concerned, I assume the margins would be quite good,” a local stockbroker said. “It’s very technical, how the cable is laid, how it deals with earthquakes. Certainly not the 6 to 7 percent-type margins. This will be huge.”
In December, the Edge weekly reported the Malaysian government agreed in principle to let Sime Darby take ownership of Bakun. (HNN 12/21/06) Sime leads the consortium building the dam, one of Asia’s largest hydro projects outside China.