Keppel Infrastructure Trust (KIT) has secured an extension of its concession agreement with Singapore’s National Environment Agency (NEA) for the Senoko WTE Plant.
The contract, originally set to expire in August 2024, has been extended for three years with an option for further extension of up to another year. It is valued at approximately S$300 million (US$224 million), of which about S$80 million will go towards the refurbishment of the waste-to-energy (WTE) facility.
Senoko WTE Plant can treat 2,310 tonnes of waste per day and generate up to 56 megawatts of electricity.
KIT, through its trustee-manager, Keppel Infrastructure Fund Management (KIFM), has appointed Keppel Seghers, the environmental technology and engineering solutions unit of Keppel Ltd’s infrastructure division, to refurbish the key components of the plant to ensure safe and reliable operations.
Keppel Seghers is also the plant’s current operations and maintenance operator and will have its O&M service contract extended by three years, with an option to further extend it for up to one year.
Commenting on the contract extension, KIFM chief executive officer Kevin Neo says: “It is a good outcome, which will enable the plant to continue supporting Singapore’s waste management strategies while contributing steady and predictable cash flows to KIT. We look forward to the continued collaboration with NEA and Senoko WTE Plant’s operator, Keppel Seghers, to ensure that all the required performance and service standards are met.”
In 2012, Keppel Seghers upgraded its flue gas treatment system to ensure operations continued to meet the new, more stringent environmental regulatory requirements. In 2016, it completed capacity upgrades and increased the plant incineration capacity by 10% to 2,310 tonnes per day.
Leveraging its expertise in WTE technology coupled with its operation and maintenance experience in Singapore and globally, Keppel Seghers will be undertaking the third asset enhancement for the Senoko facility.
Senoko WTE Plant is the third WTE plant built in Singapore and is one of four WTE plants that Keppel is currently operating globally. It was commissioned in 1992 with a land area of 7.5 hectares. Senoko has a capacity of treating 2,310 tonnes of waste per day and is equipped with six incinerator-boiler units with two condensing turbine-generators offering a total maximum power generation capacity of 56 megawatts.
The transaction is not expected to have any material impact on the net tangible assets per share or earnings per share of Keppel and KIT for the current financial year.