Tenaga Nasional Berhad (TNB) still has debts amounting to RM28.77 billion, Energy, Water & Communications Minister Dr Lim Keng Yaik revealed in a written reply in Parliament today.

In response to a question from Hasni Bin Haji Mohammad (BN-Pontian) on how much money is owed by the national energy provider, Lim stated measures are being taken to reduce these debts.

"TNB will continue with its initiatives to control operational costs to increase income and cash flow," he said.

"The effect of the ongoing operational cost controls together with the recently increase of electricity tariffs would help with the current financial position and cash flow."

Besides that, Lim said TNB has taken measures to restructure its debt management vis a vis an initiative called Prudent Debt Liability Management. This is being done in three ways.

"One is the tender and buyback measure where TNB buys back all its 10-year bonds which will mature in 2007. Then we'll issue new bonds to cover the costs incurred in buying those old bonds. The interest rates for the new bonds are much lower if you consider the cost of the new bonds."

Fulfilling duty

"We save about RM100 million using this method"

"The second measure is called Multi Currency Revolving Credit Facilities (MCRCF). This initiative aims to cover the capital expenditure and operational costs as well as pay off TNB's outstanding debts at a lower interest rate."

"It gives us flexibility in structuring new loans without increasing administrative costs."

"Lastly, we've borrowed RM1 billion from Maybank at a competitive rate."

He cited that TNB is forced to borrow RM4 to 5 billion a year to sustain its expenditure in order to fulfil its duty as the country's electricity provider.

It was revealed earlier this year that TNB's debts amounted to a whopping RM29.9 billion.