Nexif Energy, a joint venture between energy-focused private equity firm Denham Capital and Singapore-based developer Nexif, has made its debut investment in a hydro power project in Vietnam.
The platform has taken a controlling interest in the 30-megawatt (MW) Coc San facility through acquiring the majority ownership of project company Viet Hydro Partners. Singapore-based infrastructure manager InfraCo Asia Development, an existing shareholder in Viet Hydro, has retained its stake.
Coc San is a run-of-the-river power project located in the Dum River Valley, about 300 kilometres northwest of Hanoi in Lao Cai province. With construction now said to be well under way, it is expected to start generating electricity by next month.
“Hydroelectric power is one of the most economical sources of electrical energy in Vietnam. With its strong renewable hydro resources, liberalising power regulatory regime and stable political environment, Vietnam is a key investment destination and presents an attractive growth opportunity for Nexif Energy,” said Surender Singh, a founder and co-chief executive officer of Nexif Energy, in a statement.
Singh told Infrastructure Investor that Nexif Energy has plans to build a portfolio of projects totalling more than 2,000MW. The firm intends to build on Denham's capital commitment of $200 million to build the project pipeline.
“Based on the country, we will look to develop conventional and/or renewable assets that will provide economical and reliable electricity solutions. Our approach will not be reliant on any one type of solution though and is instead focused on addressing the tremendous need for new power generation in Southeast Asia currently in a cost-effective fashion,” Singh said.
“This transaction fits the profile of projects that we envisioned for Nexif Energy at the outset of our partnership, as it leverages the team’s experience in the region and aligns with our strategy of providing low-cost power generation to an emerging economy,” commented Scott Mackin, managing partner and co-president at Denham Capital.
Denham Capital, which has more than $8.4 billion under management, founded Nexis Energy alongside Nexif last August. It anticipates deploying about $200 million in project equity across Southeast Asia through the platform.