2017-09-18 | Editor:Annie Chueh 574 pageviews

CIAS Will Start the Construction of Plants at Taipei Harbor to Fight for Wind Power Market

It is estimated that the steel construction business of Century Iron and Steel Industrial Co Ltd (CIAS) will gain a few profits in 2017. However, with the company’s focus on the increasing demand for the installation of offshore wind farms in 2019 and 2020, CIAS is now working actively to receive related certification and will start the plan of its plant investment at Taipei Harbor by the end of 2017. The cost is expected to reach NT$ 500 million. The two plants will finish the construction in 2018 and 2019 to follow the future trend of local wind power market. Currently, CIAS has 2 demonstrator wind turbines of Changhua offshore wind farm and 28 wind turbines of Fuhai offshore wind farm, totaling about 30 steel towers of 3.6MW large offshore wind turbine and orders worth NT$ 3.6 billion. Now, it is expected to finish all the construction before 2020.

CIAS is one of the top 5 Taiwanese steel construction companies. In recent years, although domestic public construction cases dramatically decreased, the shipments of CIAS are stable thanks to its efforts in striving for the construction case of local plant, commercial building and bridge. To increase the operation drive, CIAS headed to Myanmar to set up plants and fought for Taiwanese entrepreneurs’ demand of investment and establishment. Besides, CIAS also cooperated with Taiwan Generations Corporation and CSBC Corporation, Taiwan to develop offshore wind power, hoping it could become the source of medium and long term growth for the company.

Under the influence of fierce competition of domestic construction market and the increase in material cost, EPS of CIAS in 1H17 was NT$ 0.09, which was lower than last year’s NT$ 0.36 at the same time. However, the company maintained some inventories in Q2 and Q3 when steel price fell. Industry observers predict that the steel construction business of CIAS will gain profits in 2H17.

In terms of the medium and long term business, the market pays more attention to the development of wind energy. According to the plan of the development in domestic offshore wind power, the installation number of offshore wind power in 2020 will reach 520MW and 3,000MW (3GW) in 2025. Based on this speed, the domestic offshore wind power market will be booming in 2019 and 2020.

To take over the market of domestic offshore wind power, CIAS has been working actively to obtain related certification since 2017 and has planned to increase capital of the subsidiary company Century Wind to NT$ 450 million in equipment. After capital increases, the amount of capital of the subsidiary company is expected to be NT$ 550 million. The shareholding ratio of CIAS will become 91.25%. CIAS plans to start the investing project of Taipei Harbor by the end of 2017. The estimation of cost is about NT$ 500 million dollars.

CIAS will construct 2 plants at Taipei Harbor and the company has obtained 8,000 square meters currently. CIAS will start the construction by the end of 2017 and will finish the project in Q3 of 2018. The other 150 thousand square meter land is expected to be retrieved in 1H18. It takes 8 to 9 months to complete the construction. Based on this speed, the plant is expected to finish building in 1H19.

Industry observers mention that although most of the local wind farms now have to deal with the issue about environmental impact assessment, viewing from the medium and long term, if the government continues to promote green energy, wind energy is still a necessary part. After the plants at Taipei Harbor of CIAS finished, the company will have favorable geographical position. In addition, by developing wind energy earlier, it may be beneficial for CIAS to strive for the orders in the future.

Besides, CIAS now has 2 demonstrator wind turbines of Changhua offshore wind farm and 28 wind turbines of Fuhai offshore wind farm, totaling about 30 steel towers of 3.6MW large offshore wind turbine and orders worth NT$ 3.6 billion dollars. Industry observers state that Swancor’s offshore wind farm received the first local offshore wind energy certification in April and it is believed that Fuhai offshore wind farm will have the chance to get the second one by the end of 2017. According to this plan, CIAS will complete the orders of 30 wind turbines before 2020.

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