KUALA LUMPUR (Sept 4): Jentayu Sustainables Bhd (KL:JSB) said it has received a letter of notification from the Energy Commission of Sabah (ECOS) for Project Oriole — a 162MW run-of-river hydropower plant in the state.

The letter outlines the key commercial and technical terms for the project, including specific deadlines for signing a 40-year power purchase agreement, achieving financial close and submitting a commitment letter and bond to ECOS.

"The project is scheduled to reach its commercial operation date no later than Dec 31, 2028," Jentayu said in a filing with the stock exchange on Wednesday.

In March, ECOS had issued the initial letter of notification to Jentayu for the project located in Sipitang.

The project is part of Sabah's long-term strategy to address its electricity needs as outlined in the Sabah Energy Roadmap and Master Plan 2040.

Jentayu had previously secured a letter of intent from the energy ministry in October 2022, allowing the group to continue developing Project Oriole.

The project was later confirmed in the Plant Up Plan for Sabah, released on Sept 19, 2023, which outlines the development plan for future power-generating plants in the region.

According to Jentayu, the project is planned to be funded with an 80:20 debt-to-equity ratio, though the exact terms have yet to be finalised. To date, the company has spent RM82.3 million on development expenses, which will be capitalised as part of the equity contribution to the project.

"Upon completion, the project is expected to generate approximately RM270 million in annual revenue and contribute positively to the company's financials," Jentayu noted.

Shares in Jentayu closed two sen or 2.94% lower at 66 sen on Wednesday, valuing the company at RM291.44 million.