Pham Manh Thang, director of the General Department of Energy under the Ministry of Industry and Trade (MoIT) said the Malaysian investor needed a one-year delay to arrange funds due to global economic turmoil knocking it off its stride.

"We have passed the investor’s proposal to the government for consideration,” said Thang.

Jaks, through its subsidiary Jaks Hai Duong Power in Vietnam, obtained an investment certificate for building the project last August under a build-operate-transfer (BOT) contract with the MoIT, with 75 per cent of the total cost to be financed by loans.

Site preparation work was initially scheduled to begin in 2012’s second quarter and the first 600MW turbine was planned to start operation in 2016’s fourth quarter. The second 600MW turbine would come on stream in the second quarter of 2017. In January this year, AmInvestment Bank, a Jaks adviser, sent a document to Malaysia Stock Exchange announcing Jaks Resources was going to sell half of its stake in the power plant to raise funds.

Jaks Resources then announced that it reached agreements with China’s Meiya Power and Malaysia’s Island Circle Investment Holding, which would respectively pay $198.24 million and $49.56 million to buy 40 and 10 per cent stakes at Hai Duong thermopower plant to establish a joint venture.

The establishment of the joint venture must be approved by Jaks’ shareholders, which was expected to be done in the middle of this year, before the deal could become effective. However, Jaks last week announced the parties "have not closed the agreements” to establish the joint venture. Thang said the MoIT had not received any Jaks proposal for transferring stakes to Chinese and Malaysian investors.

The coal-fired power plant is the fourth BOT power project invested by foreign investors in Vietnam. It was also the second one licenced over the past decade with the other being Mong Duong 2 plant invested by the US’ AES Corporation, Korea’s Posco Power and China Investment Corporation in Quang Ninh province. Some 40 per cent of construction works for Mong Duong 2 plant have been done and its first turbine was installed two months ago.