Further to the Company’s announcement dated 13 January 2017, the Board of Directors of Gadang wishes to announce that its indirect 70%-owned subsidiary, Nusantara Suriamas Sdn Bhd (“NSSB”), had on 22 December 2021 signed the Power Purchase Agreement for Large Scale Solar (“PPA”) with Sabah Electricity Sdn Bhd (“SESB”).
NSSB will design, construct, test, commission, own, operate and maintain a solar photovoltaic energy generating facility with the capacity of 5.9 Megawatt alternating current ("MWac") proposed located in Tawau, Sabah ("Facility") for connection to SESB's medium voltage Distribution Network at PPU Sri Indah to generate and deliver solar photovoltaic energy to SESB.
The PPA governs the obligations of NSSB and SESB to sell and purchase the energy generated by the Facility for a period of 21 years from the commercial operation date which is expected on 30 June 2023, in accordance with the agreed terms and conditions as stipulated in the PPA.
The signing of the PPA will not have any material impact on the earnings and net assets of Gadang Group for the financial year ending 31 May 2022. However, the PPA is expected to contribute positively to the future earnings of Gadang Group.
None of the Directors or major shareholders of Gadang and persons connected to them has any interest, direct or indirect, in the PPA.
The Board of Directors of Gadang is of the opinion that the execution of the PPA is in the best interest of Gadang Group.