KUALA LUMPUR (Oct 31): Cypark Resources Bhd’s (KL:CYPARK) third cycle of large scale solar (LSS3) photovoltaic plant of 100 megawatt (MW) in Merchang, Terengganu, was given an extension of time (EOT) which involves the revision of the period of power purchase agreement (PPA).

The company, however, did not elaborate on the extended date following the PPA revision.

In a bourse filing on Wednesday, Cypark announced that its 70%-owned subsidiary, Cypark Suria Merchang Sdn Bhd (CSM), had received a notification letter from the Energy Commission (EC) that the application for EOT had been approved by the Ministry of Energy Transition and Water Transformation (Petra) for the achievement of the commercial operation date (COD) for its LSS3 project.

The approval of the EOT involves the revision of the period of PPA, with CSM allowed to participate in any other energy supply programme and initiatives already launched by the government during the period after the revised PPA period.

The EOT will not have any effect on the share capital and shareholding structure of Cypark, but is expected to contribute positively towards the earnings and net assets per share of Cypark for the financial year ending Apr 30, 2025.

Datuk Ami Moris, executive chair of Cypark, stated that the EOT is much-needed considering that Jakel Capital Sdn Bhd — its single largest shareholder with a 21.47% stake — was bringing in fresh capital to revitalise and accelerate the completion of this project.

“We are also truly appreciative of the understanding and trust of the EC, the single buyer as well as TNB (Tenaga Nasional Bhd). With this EOT, any potential exposure to penalties or liquidated ascertained damages relating to the project is now put to rest,” she said.

To recap, Cypark was awarded the 100MW solar farm project in the LSS3 rollout in 2020. It was one of five winners for the rollout, which totalled 490.88MW.

At the time, the EC stated that the projects are awarded for commercial operation in 2021.

Cypark had in June announced that it had achieved the COD of its LSS3 solar plant project in Merchang, which was scheduled for completion in March 2022, but delayed until December 2023.

Settlement reached with KNM unit

Meanwhile, in a separate filing, Cypark said its wholly-owned unit Cypark Sdn Bhd (CSB) has entered into a full and final settlement agreement with KNM Process Systems Sdn Bhd, a wholly-owned subsidiary of KNM Group Bhd (KL:KNM) to settle all their disputes related to the RM268.38 million solid waste project in Ladang Tanah Merah, Negeri Sembilan back in 2015.

KNM Process secured the contract from CSB via its SHK Consortium, a consortium company formed between KNM Process and Hitachi Zosen Corp, Japan.

In March 2020, KNM Process had obtained a court injunction against CSB to prevent the latter from receiving proceeds from two bank guarantees related to the project, according to a court document sighted by The Edge. The parties have now mutually agreed that KNM Process shall pay a RM13.25 million settlement sum to CSB to settle the dispute between both parties.

“The above full and final settlement is expected to contribute positively towards the earnings and net assets per share of the group for the financial year ending April 30, 2025,” it said.

Shares of Main Market-listed Cypark finished down 1.5 sen or 1.82% to 81 sen on Wednesday, valuing the company at RM662.48 million.