Glow upbeat on Map Ta Phut despite court ruling

       Glow Energy Plc's three ongoing power plant projects worth 60 billion baht in Map Ta Phut remain on track despite concerns that a court ruling may force their clients to suspend operations.
       The SET-listed power producer, however, said its local and foreign creditors have started asking how its projects'future prospects could be dampened by stricter environmental regulations.
       Glow, which is majority-owned by France-based GDF Suez Energy International, targets to secure as many bank loans as possible to finance the 60-billionbaht expenditure required for its three power projects,including a115-megawatt coal-fired power plant set to be operational in December this year.
       "Investors and creditors are concerned about the uncertainties over the Thai regulations that additional requirements might be introduced in the near future,"Suthivong Kongsiri, executive vicepresident and chief financial officer of Glow told the Bangkok Post ."Those criteria might put our (power)business in a tougher situation than before."
       Major clients of Glow are subsidiaries of Siam Cement Group (SCG), US-based Dow Chemical, and Vinythai Plc. SCG's 20 ongoing projects worth 106 billion baht are among 76 projects totalling 400 billion baht that were forced to suspend construction by a Sept 29 Administrative Court ruling.
       "We updated with customers last week and found that nothing has changed.Construction of those projects have continued," Mr Suthivong said, noting that the 115-megawatt (MW) power plant is projected to lift Glow's net profit by 500 million baht in 2010 from this year's target of 4 billion.
       "If their projects cannot proceed, we might have to look into the viability of our coming projects," he said.
       Glow's 382-MW gas-turbine power plant, which is scheduled to be come online in Sept 2011, is another project that could be affected by the Map Ta Phut ruling. The company is also developing a 660-MW coal-fired power plant with operations due to start in Dec 2011 under an independent power producer license with the Electricity Generating Authority of Thailand.
       Finansia Syrus Securities said in the worst-case scenario Glow may have to delay its 115-MW project for a year which could lower the power producer's earnings next year by 17% from an estimated 5.1 billion baht.
       The brokerage forecasts Glow to post a net profit of 3.59 billion baht this year on revenue of 32.4 billion. Next year's turnover is projected at about 40.2 billion baht.
       "But that scenario has minimal chance to happen, therefore, we have maintained our annual earning growth for Glow at 31% on average during 2010 to 2012,"FSS said in a recent report.
       Shares of Glow closed yesterday on the Stock Exchange of Thailand at 33.25 baht, down 50 satang, in trade worth 25.79 million baht.