BANPU-BPP Invest THB16 Billion in Acquiring “Temple II” Gas-Fired Power Plant in USA

Banpu Pcl. (SET: BANPU) and Banpu Power Pcl. (SET: BPP) jointly announced on Tuesday that Temple Generation Intermediate Holdings II, LLC1, a subsidiary of BPP, has entered into a Purchase and Sale Agreement with CXA Temple 2 Holdco, LLC to acquire 100% interest in CXA Temple 2, LLC, the owner of Temple II Gas-fired power plant (Temple II) in Texas, USA. 

The total investment amounts to USD460 million, or THB16,060 million (the investment based on BPP’s shareholding amounts to USD230 million, or THB8,060 million). 

The transaction was successfully completed on 10 July 2023. 

Temple II is a combined cycle gas turbine facility using natural gas as a fuel with a generating capacity of 755 MW (equivalent to BPP’s capacity of 377.5 Equity MW). The operation of the power plant has commenced since August 2015. It is situated in a strategic location adjacent to the Temple I Gas-fired power plant (Temple I) in the State of Texas, which experiences consistent electricity demand due to economic growth, urbanization, and rapid population growth. Furthermore, Texas is a state blessed with abundant energy resources. 

The power plant employs state-of-the-art Combined Cycle Gas Turbines (CCGT), renowned for their modernity, efficiency, high flexibility, and advantageous merit order, making it well-suited for meeting the demands of dynamic merchant markets like Electric Reliability Council of Texas (ERCOT). Additionally, it used advanced emissions control technology, establishing itself as one of the leading environmentally friendly gas-fired power plants in the United States. 

The group has invested in Temple I since the end of 2021 and has recently established its electricity retail business in Texas. The acquisition of Temple II presents excellent growth prospects for its power business in the United States. The strategic proximity of its two power plants creates synergistic value, enabling us to efficiently operate and manage the power plants, thereby enhancing flexibility and reliability in electricity generation. 

This, in turn, affords the Banpu group greater opportunities to capture profits in the merchant market and optimize resource utilization, resulting in the Economies of Scale. Furthermore, the additional capacity strengthens its competitive position in managing breakeven points and diversifying risks along its power business value chain. Moreover, as an operational power plant, it is capable of generating immediate cash flow. 

This investment is aligned with the Greener & Smarter strategy to embrace future trends and growing towards Smarter Energy for Sustainability, supporting the acceleration of Banpu transformation, enabling us to achieve a capacity target of 6,100 MW by 2025.