Mentakab I CHP Facility - Mentakab, Pahang, Malaysia

Combined Heat and Power Plant in Malaysia. This 75 MW Combined Heat and Power (CHP) Plant provides 100% of the electrical power and steam to Malaysian Newsprint Industries’ (MNI) recycle newsprint mill in central Malaysia. As there is no connection to the national electrical grid, the reliability demands of the CHP Plant is essential to the economic performance of the mill.

Initially, the paper mill and cogen plant project were to be owned by separate entities. Our client intended to own and operate only the newsprint mill. A separate Malaysian company was to own and operate the CHP Plant, providing energy services under an Electrical and Steam Sales Agreement.

Sterling Energy was requested by MNI to participate in the project, late in the construction phase, when the owner of the CHP Plant chose to withdraw from the project. At this point, MNI initiated acquisition of the CHP Plant, and was immediately faced with the task of creating an O&M entity to support the EPC contractor during the startup that was already in progress, and to operate the plant after acceptance.

Upon receipt of authorization to proceed, our first task was to recruit and supply an “interim” team of seasoned operators to meet the immediate requirement to supply the EPC Contractor with operators during startup. Sterling Energy provided the necessary interim team within three weeks of authorization to proceed.

This group consisted of expatriates with extensive experience in power plant operation that allowed MNI to quickly meet their startup support obligations, and to operate the facility until a Malaysian O&M team could be recruited and trained.

When the Malaysian team was available, the expatriates provided an invaluable training “bridge”, acting as shift instructors and passing on the hands-on experience of startup.

Similar to our previous mobilization programs, a full-time Sterling Energy professional acted as O&M Mobilization Project Director during the team mobilization, training and startup period. Beyond that, Sterling Energy provided an “interim” Plant Manager for the first 6 months of commercial operation.

A complete set of management policies, as well as all administrative, accounting and operating procedures, were developed and validated with the permanent Team Members.

A “Sponsor” program was developed and implemented for creation of a responsibility-centered organization, as well as a qualifications program for qualifying all personnel. We also implemented a computerized maintenance and materials program utilizing Maximo software, and purchased the initial inventory of spare parts for the facility.

Finally, Sterling Energy’s team organized and managed a comprehensive system turnover and punchlist program for walk down and acceptance of plant systems from the EPC Contractor.

Other services provided to this project included a comprehensive due diligence and business review in support of the acquisition and financing.

O&M Team Mobilization

• Team structure and culture
• Team recruiting
• Training program management
• Maintenance program implementation
• Spare parts procurement
• Policies & procedures
• System Sponsor Program

Business Entity Initiation

• Local pay & benefit plans
• Payroll setup
• Business licensing
• Accounting setup and training
• Comprehensive revenue and expense model
• Business planning
• Procurement and customs programs

Interim Plant Operations

• Provide interim expatriate operations staff during startup

Plant Location:

     Pahang State, Malaysia

Commercial Operation Start:

     December 1998

Plant Description:

     3 X 25 Oil Fired

     4 MW Diesel

Plant Owner:

     Laras Perkasa Sdn. Bhd.

Developer/Operator:

     MNI

EPC Contractor:

     ABB