LHSE inks fly ash deal
LHSE inks fly ash deal
Lao Holding State Enterprise (LHSE) has entered into a memorandum of understanding (MoU) with MBTEC Lao Company Limited on the sale and purchase of fly ash.
The MoU states the terms for the purchase of one million tonnes of fly ash out of the two million tonnes that will be produced at the Hongsa power plant each year when electricity generation commences, which will be soon.
LHSE recently signed MoUs on ash purchases with several companies, and other companies in Laos, Thailand and China are also interested in buying the ash.
General Manager of LHSE, Dr Somboune Manolom, signed the MoU with the Director of MBTEC Lao Company Limited, Mr Khamthong Tran, witnessed by invited guests and company personnel.
Fly ash, a by-product of burning coal for electricity generation, can be sold to the construction industry as it is used in cement and concrete factories in Laos. It can be mixed with concrete to reduce the cement requirement by 15 to 20 percent.
The purchasing deal will start in 2015, after LHSE and MBTEC Lao Company Limited have reached a sale and purchase agreement.
The enterprise aims to allocate 23 billion kip this year to prepare for its fly ash business, which is set to kick off next year.
The budget will be used for the construction of offices, a laboratory and dormitory for staff at the project site in Hongsa district, Xayaboury province, according to a recent LHSE report.
The construction of all facilities is set for completion early next year.
The demand for fly ash is high. One local company wants about half a million tonnes annually but a Thai company wants to purchase around 1 million tonnes per year.
In a recent report, Dr Somboune said that LHSE, on behalf of the Lao government, will continue ash purchase negotiations with a Chinese company that is considering buying about 300,000 tonnes per year.
At the company's annual meetin g last year to review its 2012 operations, Dr Somboune said that, based on the initial study, LHSE could earn about 64 billion kip (US$8 million ) annually from fly ash sales .
This means operations will yield about 1.6 trillion kip (US$200 million) over the 25 year period.
Thailand's Ratchaburi Electricity Generating Holding Public Company reported in 2010 that the Hongsa power plant will produce about 2 million tonnes annually of residual ash once electricity generation commences.
