Malaysian timber industry company BTM Resources Bhd (BTM) has entered into a memorandum of understanding with China Western Power International and Sichuan No 2 Electric Power Construction Company (Sichuan Power) to set up a waste-to-energy plant in Malacca.

BTM outlined the details of the project in an announcement to Bursa Malaysia on April 17. The three companies will jointly invest in the power generation project via a special purpose vehicle. The plant will have a capacity of around 1,000 tonnes per day, and will cost 435 million ringgit (US$100 million).

BTM said its obligation is to secure a waste disposal concession of not less than 25 years from the Malacca government, as well as suitable tipping fees and a power purchase agreement. It is also required to identify, propose and procure a suitable site for the plant.

The stock exchange statement added that China Western Power and Sichuan Power will be responsible for the entire funding cost of the engineering, procurement, construction and commissioning of the power generation project.

It added that the collaboration will serve as a platform for the company to tap into “the reputation, experience and standing of Sichuan Power in power generation projects," while also diversifying the income stream of BTM Group.

China Western Power is involved in the business of investment, engineering, business and management services in clean energy. Sichuan Power is a subsidiary of PowerChina, one of China’s biggest multinationals, with construction projects in Africa and South America as well as across Central Asia and Southeast Asia.