REA Group strikes deal with China Datang on wind energy activities

Companies form JV to construct and develop wind farms, as well as manufacture wind turbine components.

Renewable Energy Asia Group (REA Group), formerly known as Superior Fastening Technology, has inked a strategic co-operative agreement with China Datang Corporation Renewable Power Co., Ltd, a subsidiary of China Datang Corp, one of the PRC’s largest state-owned power producer by installed capacity, according to a REA report.

Under the terms of the agreement, REA Group and Datang will form joint-venture companies to engage in wind energy related activities, namely engineering, procurement, and construction (EPC) of wind farms; wind turbine component manufacturing; and wind farm development and electricity generation. REA Group will hold a 51% equity stake in companies formed to provide EPC and wind turbine component manufacturing services, while Datang will hold 49%. As for companies formed to engage in wind farm development, REA Group will have a 49% stake, while Datang will hold 51%.

Commenting on the co-operation with Datang, Mr Xu Jian, Chairman of REA Group said, “REA Group will be able to leverage Datang’s support and experience to further develop our wind energy business. This strategic partnership is a major milestone as it will pave the way for our expansion in this sector going forward.”

In the near term, REA Group expects to derive its operating income from EPC projects, while long-term recurring income should come from its wind farm development and electricity generation business.

This is the latest of a steady stream of developments for REA Group. Within the past two months, the Company has secured a concession to develop a 500MW wind farm in Huade County of Inner Mongolia, a US$20 million master contract to manufacture wind turbine components, a concession to develop a Green Energy Park in Zhenglanqi, Inner Mongolia and a $7.4 million deal to manufacture wind turbine towers for a wind farm.