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3. Interim Results of Least-Cost Risk Analysis Overall NPV versus no NT2: USD 269 million
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1. Thailand - Electricity Consumption and GDP Growth
0
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140000
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Year
GD
P in
dex
or G
Wh
GDP index GWh produced
The economy grew 3.1%/yr. and electricity demand 6.5%/yr.
2. Thailand – Increase of Generation vs. NT2
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16000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Year
GW
h
Increase of GWh req NT2 PE + SEC1
NT2 provides 6% of consumption increase between 2009 & 2016
3. Interim Results of Least-Cost Risk Analysis
NT2Costhigh
mediumlow
*according to gas value and demand+ 286 to + 542
Range ofPV Cost Saving*
- 63 to + 193+ 111 to + 367
Overall NPV versus no NT2: USD 269 million
4. The Economic Value Chain
End-use gWh times price =Consumer WTP
Minus marginalTransmission &Distribution cost
Minus NT2Investment,O&M and E&Smanagement cost
power value-added=
Scenario ERR1. Base Case 17.1%2. Returns delayed one year 15.3%3. 10% Project Cost Over-run 15.9%4. Cases 2 & 3 combined 13.8%5. Low Demand 13.6%6. Case 5 & 30% cost over-run 11.1%
5. Investment Cost (Financial)
135.9
69.9
302.9675.9
Development
Env & Social
Financing:
Power Plant
of which contribution to GoLUSD 30 million
Total Cost toCommercial Operation Date: USD1184.7 mm
6. NT2 vs CCGT (Commercial)
fuel $/mm Capacity Cost $mm per 100MW 0.0460 35 40 45 50 53.66 60
2.25 0.0355 0.0368 0.0382 0.0395 0.0405 0.04222.50 0.0372 0.0386 0.0399 0.0413 0.0422 0.04392.75 0.0390 0.0403 0.0417 0.0430 0.0440 0.04573.00 0.0408 0.0421 0.0434 0.0448 0.0458 0.04753.25 0.0425 0.0439 0.0452 0.0465 0.0475 0.04923.50 0.0443 0.0456 0.0470 0.0483 0.0493 0.05104.00 0.0478 0.0492 0.0505 0.0518 0.0528 0.05454.50 0.0513 0.0527 0.0540 0.0554 0.0563 0.05804.75 0.0531 0.0544 0.0558 0.0571 0.0581 0.0598
Yellow cell combinations: NT2 is cheaper
Inner-boxed CCGT prices show NT2 and gas very close commercial competitors.
7. Cash Flow From Operations
-20.0
0.0
20.0
40.0
60.0
80.0
100.0
120.0
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49
time period
USD
mill
ions
Chg Wkg Capital Debt Service Chg Reserves Royalty Tax Income Tax GoL Dividends Ext Dividends
Debt service
Non-GoL Dividends
GoL dividends
Royalty
Tax
8. Real Present Value Returns of and to Capital
PV Debt Service455 million
PV Non-GoL Dividends328 million
PV GoL Returns248 million
Returns "of" and "to" capital
GoL Equity: 25%; GoL returns: 43% of returns to all shareholders
9. Lao PDR Cumulative Returns
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1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49
USD
mill
ion
Gol Cumul Nominal Returns Gol Cumul Real Returns Cumul PV real Gol Returns
Lao returns cumulate to USD 1.8~1.9 billion; Present Value of ~ USD 250 million at 10% DR
10. Summary of Interim Findings
1. Based on real resource costs (no taxes and sunk costs), NT2 is least-cost electricity; compared with CCGT the cost difference is large enough for NT2 to “absorb” taxes, royalties and commercial returns to equity.
2. NT2’s economic rate of return is satisfactory and robust.
3. When taxes, royalties and equity returns > 10% are added, NT2 and CCGT are close competitors; but NT2 has a fixed tariff, and CCGT costs will fluctuate with oil price changes.
4. GoL gets 43% of the returns for a 25% share holding, while shareholders earn normal returns for this kind of investment.
5. These results will be amended once the environmental and social costs now included (about USD 120 million) are fully assessed, and the final project construction price is known.
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