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Keppel consortium bags cooling system contract worth over 7.5b baht

PMCU DCS_Artist Impression_1.jpeg
Keppel DHCS, BCPG and Team Group have secured a contract for a new district cooling system (DCS) in Bangkok. Located in Sam Yan, the DCS plant will serve the cooling needs of eight developments in the Chula Smart City project.

A UNIT of Keppel Corporation is part of a consortium of three companies that was awarded a contract worth more than 7.5 billion baht (S$329 million) for a district cooling system (DCS) in Bangkok.

The unit, Keppel DHCS, is a DCS service provider that provides cooling services at major business parks, including Singapore's Changi Business Park, one-north (Biopolis, Fusionopolis, Mediapolis) and Woodlands Wafer Fab Park.

Keppel DHCS is a wholly-owned subsidiary of Keppel Infrastructure, which is in turn a wholly-owned subsidiary of Keppel Corporation.

The other companies in the consortium are Thai renewable energy company BCPG, and Thai engineering consultancy Team Consulting Engineering and Management (Team Group).

The contract was awarded by the Property Management of Chulalongkorn University, the companies said in a joint statement on Thursday.

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The university is developing its "green" campus in Bangkok and the surrounding commercial zones into a smart city project named Chula Smart City. The project aims to sustainably rejuvenate and redevelop the Thai capital's Siam Square, and Suan Luang - Sam Yan commercial areas.

Located in Sam Yan, the DCS plant will have a projected cooling load of 18,000 refrigeration tonnes to serve the cooling needs of eight developments - covering office, retail and residential properties - that are part of the smart city project, the companies said.

The consortium partners aim to form a joint venture to design, build, operate and transfer the core and shell of a DCS plant, as well as design, build, own, operate and transfer the DCS assets, they added.

The plant will be developed over three phases, with its first phase to be operational in Q4 2022. It is expected to be fully completed in 2027.

Keppel DHCS will lead the operations and maintenance of the plant for 20 years. Its shareholding in the joint venture will be 26 per cent, with the rest being held by BCPG and Team Group.

The companies said DCS is a cost-effective and greener alternative to conventional air-conditioning systems. DCS involves supplying a cluster of buildings with chilled water for their air-conditioning needs, from a centrally-located plant via a network of pipes.

Aggregating energy loads means the overall installed capacity can be lower than if each building used a separate cooling unit. This aggregation also reduces the overall carbon footprint, the companies added.

They said the energy-efficient and space-saving attributes of DCS make it "suitable and attractive" to address the needs of city centres and property developments.

"As one of the first private district cooling projects in Thailand, the new DCS in the heart of Bangkok will lay the groundwork for the adoption of more sustainable cooling solutions, given the country’s high demand for cooling all year round," they added.

Keppel DHCS general manager Chua Yong Hwee said the project would "deepen Keppel DHCS’s understanding of the Thai market and help establish a foothold for us to seek further opportunities in Thailand".

Keppel Corporation said it does not expect the transaction to have any material impact on its earnings per share and net tangible assets per share for the current financial year.

Shares of Keppel Corporation were trading at S$5.96 as at 2.18pm on Thursday, up S$0.03 or 0.5 per cent, after the announcement.

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