Sembcorp expands into China's Hubei province with new $20.5m project

SINGAPORE - Sembcorp Industries has expanded its industrial wastewater treatment business to China's Hubei province, with a joint venture agreement to build, own and operate a plant in Jingmen city.

The Singapore-listed company's subsidiary Sembcorp (China) Holding will own a 95 per cent stake in the venture. The remaining 5 per cent will be held by Jingmen Xinyuan Investment Company, which is wholly owned by the Duodao District Government of Jingmen city and a business arm of the JCIP Administration Committee.

The project will involve a total investment of 98.7 million yuan (S$20.5 million), which will be funded by a mix of equity and borrowings. Sembcorp's 95 per cent share of the equity investment comes to 37.5 million yuan and will be paid for with internal funds.

Located in Jingmen Chemical Industrial Park, the plant will have an initial capacity of 10,000 cubic metres per day with capabilities to treat multiple streams of industrial wastewater.

It is expected to be completed in the first half of 2016 and will provide industrial wastewater treatment services to companies in the JCIP under a 30-year exclusive concession agreement.

Hubei province is located at the juncture of the Yangtze River Economic Belt and the Beijing-Guangzhou Railway Economic Belt. The province had a gross domestic product (GDP) of 2.47 trillion yuan in 2013, one of the highest amongst China's provincial regions.

"Our latest success in Hubei leverages Sembcorp's strong capabilities in offering innovative and effective water and wastewater management for industries in China," said Sembcorp China chief executive Alan Yau.

"We are pleased to extend our specialised water solutions to Hubei province, where we will contribute to its environmental protection while supporting industrialisation."

The Hubei project means that Sembcorp's utilities business now extends across 11 of China's provincial regions.

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