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Cavico Subsidiary Receives Investment Certificate for the Lam Dong Wind Power Plant
LOS ANGELES & HANOI, Vietnam--(BUSINESS WIRE)-- Cavico Corp. (“Cavico” or “the Company”) (OTC BB: CVIC), a leading infrastructure development company in Vietnam, today announced that Cavico Transportation, the Company’s wholly owned subsidiary, received the investment certificate from the Lam Dong’s People Committee for the windpower plant in Cau Dat-Xuan Truong Village, Da Lat City, Lam Dong province.
Cavico had earlier announced that it planned to actively pursue wind energy projects. The receipt of the investment certificate is the final legal documentation required for the Company to develop a wind power plant as a builder-owner-operator (BOO). Lam Dong’s People Committee also approved the plant’s location at which Cavico has conducted feasibility studies and measured the available wind power. Cavico expects the entire process of completing construction work and commencing operations to take three years. From now through the end of 2010, the Company plans to meet with potential co-investors, select a CDM partner (Clean Development Mechanism, a Kyoto Protocol mechanism to assist industrialized countries reducing their greenhouse gas emissions), determine engineering and technological requirements, and negotiate the electricity selling price with the Vietnamese government. Upon finalizing these details, Cavico will begin construction work, import the required equipment, and install the wind turbines.
In the first phase of the project, Cavico plans to construct a 30 megawatt (MW) windpower plant which upon completion will be connected to the national grid. According to the results from studies by the Company’s consultant firm, PECC 3 (Power Engineering Consulting Company 3) the plant may be expanded to 100-300 megawatt. Cavico expects the plant will use 350 hectares of land of which 10.8 hectares will be permanently occupied. A total of 339.2 hectares of land will be impacted by this plant. Cavico projects that total capital investment on this project will be approximately $56.6 million. The Company plans to invest equity of $11.4 million, about 20% of the total capital investment, in the project and finance the remaining amount with debt.
“We are happy to report the successful receipt of the investment certificate for the wind power plant. Results from our preliminary studies show that there is a huge potential for wind power in the Lam Dong province,” commented Mr. Thanh Vu Tran, President of Cavico Transportation. “The Vietnamese government has an increased focus on clean energy projects. We have received increased amount of support and encouragement from the Lam Dong’s People Committee and local government. We have also received a lot of interest from investors and financing groups. We strongly believe that the wind power plant will contribute significantly in easing the electricity shortage problems in Vietnam.”
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