KUALA LUMPUR (May 15): BTM Resources Bhd (KL:BTM) has called off its plan to build a 10MW biomass power plant after the banking facilities it obtained for the project was cancelled. It is also considering whether to cancel another 7MW biomass power plant, which it has put on hold for now.
The sawmill operator said Sustainable Energy Development Authority Malaysia had on May 8 agreed to its application to relinquish the feed-in-tariff (FIT) approval certificate for the 10MW biomass power plant, it said in a bourse filing Thursday.
Besides the cancellation of banking facilities in February this year, it cited current market volatilities, including raw material price fluctuations as reasons behind its decision.
The relinquishment of the FIT approval took effect on April 30. The original approval, granted in July 2020, allowed the group to build, own and operate the renewable energy plant as well as supply electricity to Tenaga Nasional Bhd (KL:TENAGA) at a fixed tariff rate of RM0.3486 per kilowatt-hour for 21 years.
BTM said the withdrawal of its FIT would not materially impact its operations, as the biomass power plant had not commenced construction.
The group still holds another FIT approval, granted in May 2022, for the 7MW biomass power plant. It is reassessing the plant's potential utilisation and may consider relinquishing the FIT approval for it if prevailing market conditions persist in the next six months.
“Therefore, the biomass power plant project is presently put on hold,” BTM Resources said, adding it is looking at alternate uses and potential business ventures for the project land, and that details have yet to be finalised.
BTM Resources' share price settled unchanged at four sen on Thursday, valuing the group at RM50 million.