HANOI, Vietnam, April 4, 2011 (GLOBE NEWSWIRE) -- Cavico Corp. (Nasdaq:CAVO) ("Cavico" or the "Company"), a major infrastructure, civil engineering design, and construction conglomerate based in Vietnam, today announced that its subsidiary, Cavico Mining, has received an investment license for the Tan My Hydropower Plant. The license was issued to Cavico Tan My Trang An Hydropower Company ("Cavico Tan My"), a majority-owned subsidiary of Cavico Mining, by the People's Committee of Ninh Thuan Province. Cavico Tan My was founded by Cavico Mining to undertake this project.
The license grants Cavico Tan My the right to build, own and operate a hydropower plant downstream from the Tan My Irrigation Reservoir. The plant will be built on an area of approximately 280,000 square feet in Phuoc Tan Village, Ninh Thuan Province. The plant has a designed capacity of 6 megawatts and is expected to produce approximately 25 million kilowatt-hours (kWh) of power annually. At the expected rate of $0.05 per kWh, the plant will generate $1.25 million per year in total revenue. The total estimated investment cost of the project is $6.7 million, or approximately $1.1 million per megawatt.
Cavico Mining has engaged the Institute of Hydro and Renewable Energy ("IHR") as a consultant to carry out a feasibility study and create a design for the project. For more information about IHR, visit http://www.ihr.org.vn .
Cavico expects to realize significant cost benefits by constructing the plant downstream from the Tan My reservoir. According to IHR, building a hydropower plant downstream from an existing reservoir can reduce construction costs by approximately 50% by eliminating substantial costs related to site clearance and the construction of access and transport roads, water canals and tunnels, dams, reservoirs and other infrastructure, which can result in total construction costs as high as $2.5 million per megawatt.
"Building a hydropower plant downstream from an existing large reservoir greatly reduces our construction and operating costs and maximizes our operating capabilities. Our plant will use a small percentage of the reservoir's massive water supply, enabling the plant to operate continuously even during the dry season. In addition to the reservoir, we will only need to construct a turbine house and a canal to direct the water to the turbine house. We believe these cost savings will provide us with a higher return on our investment," commented Mr. Hung Manh Tran, executive vice president of Cavico Corp. and chairman of Cavico Mining. "Cavico Mining will continue to negotiate with government agencies to obtain favorable electricity sales prices and with investors and bankers to secure project startup funds."
About Cavico Corp.
Cavico Corp. is focused on large infrastructure projects, which include the construction of hydropower facilities, dams, bridges, tunnels, roads, mines and urban buildings. Cavico is also making investments in hydropower facilities, cement production plants, mineral exploration and urban developments in Vietnam. The company employs more than 3,000 employees on projects worldwide, with offices throughout Vietnam and a satellite office in Australia. The Company now has three subsidiaries, Cavico Mining (HSX:MCV), Cavico Industry & Mineral (HNX:CMI), and Cavico Construction Manpower & Services ( HNX: CMS ), which are listed in Vietnam on the Ho Chi Minh and Hanoi Stock Exchanges.
Founded in 2000, Cavico is a major infrastructure construction, infrastructure investment and natural resources conglomerate headquartered in Hanoi, Vietnam. Cavico is highly respected for its core competency in the construction of mission-critical infrastructure including hydroelectric plants, highways, bridges, tunnels, ports and urban community developments. One of the Company's primary competitive advantages is its ability to nurture a project "from concept through completion" with a vertical portfolio of interrelated investment, permitting, design, construction management and facility maintenance services. Cavico's project partners include top multi-national corporations and government organizations. The Company employs more than 3,000 full-time, part-time, and seasonal workers. For more information, visit http://www.cavicocorp.com . Information on the Company's Web site or any other Web site does not constitute a portion of this release.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact in this announcement are forward-looking statements, including but not limited to, the Company's ability to obtain the necessary financing to continue and expand operations, to market its construction services in new markets and to offer construction services at competitive pricing, the Company's ability to complete projects in the time frame specified; anticipated revenue from the projects to attract and retain management, and to integrate and maintain technical information and management information systems; the effects of currency policies and fluctuations, general economic conditions and other factors detailed from time to time in the Company's filings with the United States Securities and Exchange Commission and other regulatory authorities. These statements include, without limitation, statements regarding our ability to prepare the Company for growth; the Company's planned expansions, and predictions and guidance relating to the Company's future financial performance. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
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