TNB may buy coal mines in Indonesia

comments     Kevin Tan     Published     Updated

Tenaga Nasional Bhd may purchase coal mines in Indonesia to meet the projected demand for coal in three new power plants, said Deputy Minister of Energy, Communications and Multimedia Tan Chai Ho today.

"TNB is conducting a study into the possibility of buying a company which has coal (mines) in Indonesia," he said.

According to him, the use of coal will increase from the current five million tonnes to 20 million tonnes when three new power plants become operational in 2007.

The new plants will be operated by TNB Janamanjung Sdn Bhd, SKS Ventures and Jimmah Powers.

The deputy minister revealed this when responding to a question from Senator Jamilah Ibrahim (PAS-Kelantan) in the Dewan Negara.

Besides ensuring a steady stream of supply, Tan said the purchase would also reduce the risk of having to pay more if the price of coal increased in the future.

Alternative sources

Meanwhile, Senator Ghazi @ Hasbullah Ramli asked the ministry whether TNB considered buying coal from domestic sources, namely Sabah and Sarawak and if the government had considered an alternative energy source.

To this, Tan said TNB needs to consider the quality of the coal. According to him, the coal must have less than five percent of acid.

He also said the country could not afford to rely on gas to generate energy as it is expensive.

Currently, 76 percent of the energy source in Malaysia comes from gas, five percent from oil, seven percent from coal, 10 percent from hydro and two percent from biomass.

However, the deputy minister said under the Eighth Malaysian Plan, the government emphasised the use of 'renewable energy sources'.

"Licences are given to companies involved in the use of biomass energy so that they can use biomass waste such as palm oil and rice husks [to produce energy]," Tan said.



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