NEWS
ECONOMY   Water  

Hyflux suspends contract for desalination package in Iran

HYFLUX has suspended a contract for a seawater reverse osmosis desalination package in Iran, which the company said on Friday is expected to have a material adverse effect on its financial performance. NAVIN SREGANTANnavinsre@sph.com.sg@NavinSreBT

The contract was signed in April between Hyflux subsidiary Hyflux International and Iran's Asia Water Development Engineering Company (AWDEC) for a seawater reverse osmosis desalination package in Bandar Abbas, Iran. In July, AWDEC indicated - through a letter of intent - for a second contract for the project.

Hyflux, which has its shares suspended on the Singapore Exchange (SGX), cited that it was unable to maintain the requisite banking support to receive payment from AWDEC for works to be performed under the contract. This is a result of the US's decision to withdraw from October 2015's implementation of the Joint Comprehensive Plan of Action (JCPOA) and to reinstate the US sanctions that were in force before the implementation of the JCPOA.

In its filing with the SGX on Friday, Hyflux said that after having discussions with AWDEC, it notified the Iranian company on Dec 11 of its decision to suspend the contract with effect from Oct 16. As a result of these geopolitical developments, Hyflux said that it has also taken no further step to "formalise and/or execute the second contract with AWDEC".

Separately, Hyflux terminated a joint venture (JV) agreement signed in March 2014 with Tolaram Corporation for the development of membrane-based water treatment plants in Nigeria.

Established in 1948, Tolaram conducts business in manufacturing, energy, real estate, digital services and infrastructure.

As part of the JV agreement, Yewa Water (Singapore) was set up, which both Tolaram and Hyflux had an equal stake in. The Singapore-registered entity owned the majority stake in Yewa Water Company (Nigeria), a company incorporated in Nigeria that was intended to be used to undertake water projects in the country. 

The termination of the JV, and the liquidation and striking off of the Yewa Water entities with Tolaram is not expected to have a material adverse effect on the financial performance of Hyflux.

The termination of the JV with Tolaram is not expected to have a material adverse effect on the financial performance of Hyflux. 

Trading in Hyflux shares remains suspended.

News No: 2920
Date: 2018/12/15 - 22:21
News Source: Business Times

Asia Water Development Eng  AWDEC  HYFLUX  desalination package  JCPOA 

Comments:

Leave a Comment:

   
   
   
 

Iran-Switzerland Payments Channel Ready: Official

The head of Iran-Switzerland Joint Chamber of Commerce announced that a payments channel has been developed and prepared to be inaugurated in a bid to boost bilateral trade between the two countries.
 

Tehran, Vienna to Broaden Energy Cooperation

Representatives from Iranian and Austrian energy companies reached news agreements in a 4-day meeting in Vienna where they held the 5th joint workgroup of the two countries, said Iranian Foreign Ministry Spokesman Bahram Qassemi on Friday.
 

Iran’s Withdrawal from JCPOA Not in Europe’s Interest: Kharrazi

Head of Iran’s Strategic Council on Foreign Relations Kamal Kharrazi said the country’s possible pullout from the 2015 nuclear deal known as the Joint Comprehensive Plan of Action (JCPOA) would not be in the interest of European countries.
 

EU Lacks Needed Structures to Develop SPV: Iran

Iranian Foreign Ministry Spokesman Bahram Qassemi said the European Union lacks the structures needed to create the special purpose vehicle (SPV), the mechanism aimed at facilitating trade with Iran in the US sanctions era.
 

Mogherini: US Decision Making for EU Unacceptable

High Representative of the European Union for Foreign Affairs and Security Policy Federica Mogherini said the US as the closest ally of the European Union (EU) is not allowed to dictate to the bloc, reassuring that the EU will spare no efforts to protect legitimate trade with Iran.
 

Iran, China Discuss Transportation

Experts from Iran and China convened in the Southern Chinese city of Iowa on Sunday to exchange views on challenges and opportunities of the two nations in developing cooperation in maritime and railway transportation.
Upcoming Events
Publications
 Mines & Metals

Mine & Business Today

 Scrap & Recycling

Ahangan

Our partners