Beijing Development up 4.1pc on plans for waste-to-energy venture
Beijing Development (Hong Kong) announced a joint venture for a 1.53 billion yuan (HK$1.9 billion) waste-to-energy project in Beijing’s Haidian district.
Shares of Beijing Development (Hong Kong), the information technology and waste treatment unit of state-backed energy-to-brewery conglomerate Beijing Enterprises, gained 4.1 per cent after it announced a joint venture for a 1.53 billion yuan (HK$1.9 billion) waste-to-energy project in Beijing’s Haidian district.
The shares traded at HK$2.82 at 11.23am today. They have risen 76 per cent since the start of the year, outperforming the Hang Seng Index’s 8 per cent gain.
Under the deal, Beijing Development has entered into an agreement with Beijing Lvhaineng Environmental Protection, wholly-owned by the municipal government, in which the two firms will invest in a processing plant with a daily capacity of 2,500 tonnes.
This includes waste incineration amounting to 1,800 tonnes, and the fermentation of 400 tonnes of food waste a day.
The formation of the [joint venture] with Lvhaineng represents an attractive opportunity
Power generated from the plant will be sold to the power grid at 0.65 yuan per kilowatt-hour. It will also collect a waste treatment fee of 125 yuan per tonne.
“The formation of the [joint venture] with Lvhaineng represents an attractive opportunity to the group to establish an immediate presence in waste incineration-power generation operation [on the mainland],” Beijing Development said in a filing to Hong Kong’s stock exchange.
Some 600.5 million yuan of the project will be financed by the Beijing municipal government, and 925 million yuan by Beijing Development and Lvhaineng.
Beijing Development will have a 99 per cent stake in the joint venture, and Lvhaineng 1 per cent.
Commercial operations are expected to start in May next year.
