KUALA LUMPUR, July 26: Japan’s Sumitomo beat three other giants — Mitsubishi, German’s Siemens and France’s Alstom — to win a six billion ringgit (1.6 billion dollar) contract to build a coal power plant in Malaysia, a senior official said on Friday.

Sumitomo Zelan Consortium will ink the engineering, procurement and construction agreement for the commissioning of the power plant late Friday, the senior official, familiar with the the deal, told AFP on condition of anonymity.

The agreement will be signed with Malaysia’s SKS Power, which plans to develop a 2,100 megawatt coal-fired power plant in southern Johor state to supply electricity to state utility Tenaga Nasional.

The Tanjung Bin power station will comprise three plants of 700 megawatts each. The first plant is expected to be operational in August 2006 and the other two plants should be completed in the following year.

Competition between the (firms) was tough but in the final round Sumitomo edged out the other three players, the official said.

Analysts said the Tanjung Bin project could be the biggest power contract awarded this year in Asia.

Malaysia needs to plan its power needs. The power plant is relevant to our needs as it will help diversify our energy dependence, said Pankaj Kumar, assistant senior manager with OSK Research.

Other power sources in Malaysia include diesel and mini-hydro projects.

At present there are only two coal-fired power plants in Malaysia while there are over a dozen gas-fired plants.—AFP