German industrial giant Siemens and Japan's Mitsubishi Corporation are in a straight fight to secure a RM6 billion contract to build a power plant in Malaysia, a senior official said today.

"The race now is between Siemens and Mitsubishi," an industry official familiar with the project told AFP o­n condition of anonymity.

Japan's Sumitomo and France's Alstom "are out of the race," the official said, adding: "An announcement of the winner will be made this week."

Operational in 2006

Malaysia's SKS Power plans to develop a 2,100 megawatt coal-fired power plant in southern Johor state to supply electricity to state utility giant Tenaga Nasional.

The Tanjung Bin power station will comprise three units of 700 megawatts (MW) each. The first is expected to be operational by August 2006 and the other two should be completed in the following year.

Siemens recently launched its regional transportation hub in Malaysia, giving the country a big boost in its aim to become an industrial powerhouse.

At present there are o­nly two coal-fired power plants in Malaysia while there are over a dozen gas-fired plants.

Three-quarters of Malaysia's electricity is generated from gas while coal provides o­nly 12 percent.

Growing demand

Analysts said if the economy grew five to six percent in 2003, electricity demand growth should be about eight percent next year.

Power consumption in Malaysia grew rapidly due to strong economic growth in the 1990s, forcing the government to liberalise the industry in 1993 and end Tenaga's monopoly o­n power generation and distribution.

This brought about the emergence of numerous independent power producers, including YTL Power Generation, Powertek Group and Genting Sanyen Power Group. -- AFP