Malaysia Prime Minister Abdullah Ahmad Badawi has launched the Sarawak Corridor of Renewable Energy (SCORE) covering 70,000 square kilometers of Sarawak State including several major hydropower projects.
In ceremonies February 11, Abdullah initiated SCORE, one of five regional corridors in Malaysia. (HNN 2/6/08) The prime minister also witnessed the signing of 13 memoranda of understanding pertaining to potential investment projects.
At the core of the renewable energy corridor are energy sources, particularly 20,000 MW of potential hydropower, as well as coal and natural gas resources. Sarawak State, on Borneo Island, already includes the 2,400-MW Bakun hydroelectric project, which is under construction. (HNN 12/19/07)
The Sarawak corridor investment strategy includes advancing the development of currently feasible hydropower projects, including 900-MW Murum, 150-MW Limbang, 1,000-MW Barang, and 1,000-MW Baleh. (HNN 9/4/07)
Mining and metals group Rio Tinto Plc signed a power supply agreement with Sarawak Energy Bhd to purchase between 900 MW and 1,200 MW from Bakun to power a new smelter. Press Metal of Malaysia also signed a deal with Sarawak Energy to buy 510 MW of hydropower for another new smelter.
During the same event, Malaysia national utility Tenaga Nasional said it would work closely with Sarawak Energy to source more power for mainland Malaysia via two undersea transmission cables to be constructed for that purpose.
The Regional Corridor Development Authority has been established as a one-stop agency to facilitate all investment activities in SCORE and to develop the central region and Sarawak into a developed state by 2020.
Islamic banks to establish Borneo energy fund
In other action, three Islamic banks are teaming up with Sarawak Energy to set up an Islamic energy fund to finance up to US$6 billion in projects in Sarawak. The parties are to sign a memorandum of understanding in Sarawak in February.
They plan to set up the fund with an initial size of about US$1 billion, Asian Finance Bank Chief Executive Faisal Alshowaikh said February 5. The other two banks involved in setting up the fund are RHB Islamic, a unit of Malaysian bank RHB Capital Bhd, and Bahrain-based Unicorn Investment Bank, he said.
In addition to completing 2,400-MW Bakun Dam, the state plans to develop another 2,000 MW in hydroelectric capacity by 2013.
Asian Finance Bank, controlled by Qatar Islamic Bank, and Unicorn Investment Bank are looking to channel Middle East money into Asian investments that comply with Islamic law, which bans investment in activities such as gambling, alcohol, tobacco, pork, and weapons manufacturing.
The banks and Sarawak Energy would be proposing to contribute up to 30 percent of the initial fund capital, Alshowaikh said, though he stressed the deal was in its early stages and that the next step was to form a working group to draft a firm proposal.