Tuas Power plans S'pore's 1st coal-fired plant-paper

SINGAPORE, March 27 (Reuters) - Singapore's Tuas Power, which was sold this month to Chinese power firm Huaneng Group for $3 billion, is planning to build the city-state's first coal-fired plant, a newspaper reported on Thursday. Tuas Power chief executive Lim Kong Puay told the Business Times that it will tap new owner Huaneng's experience with coal to build the new plant, which he estimates will cost S$2 billion ($1.45 billion). Tuas Power currently operates 1,460 megawatts of combined cycle gas turbines (CCGT) using natural gas, and has another two 600 megawatts steam plants which it is planning to convert to either CCGT or coal-powered units, the report said.

"The coal-firing option would probably cost around S$2 billion. By comparison, going the CCGT route would involve about S$700-800 million of capital investment," Lim said.

"But coal-firing overall is cheaper than gas. While it involves higher capital costs, it will result in lower operating costs."

Huaneng on March 14 acquired Tuas Power -- which generates 26 percent of Singapore's electricity -- from state investor Temasek Holdings [TEM.UL] following a three-month bidding process.

Huaneng's Hong Kong-listed unit Huaneng Power (600011.SS: Quote, Profile, Research, Stock Buzz) (0902.HK: Quote, Profile, Research, Stock Buzz) has said it signed a letter of intent to buy the plant from its parent.

The newspaper said that Tuas Power's name remains unchanged after the Huaneng acquisition, and its current Singapore management has been asked to continue running the company.

It added that Huaneng officials will sit on Tuas Power's board, which will meet in April for the first time since the purchase. (Reporting by Daryl Loo; Editing by Michael Urquhart)