By Florence Tan
SINGAPORE, Feb 24 (Reuters) - France's Engie SA ENGIE.PA , looking to sell a coal-fired power station in Australia that could fetch $1 billion, expects to attract more interest from international firms than local players, its Asia Pacific head said.
Engie flagged the sale of the 953 megawatt Loy Yang B coal-fired plant and its small Kwinana gas-fired power plant last November, when it announced it would close its Hazelwood power plant, Australia's dirtiest coal-fired power station. will be an international tender. There could be Australian (interest) but I would expect more interest from international players than local," Engie's Asia Pacific president, Jan Flachet, told Reuters in an interview late on Thursday.
Australia's top utilities, Origin Energy ORG.AX , AGL Energy AGL.AX and EnergyAustralia, owned by Hong Kong's CLP Holdings 0002.HK , have all flagged they want to expand in renewable energy rather than coal-fired power.
Loy Yang B and Kwinana have been put up for sale as the company is looking to "de-carbonise" and focus on renewable energy. The plants are both co-owned with Japanese trading house Mitsui & Co Ltd 8031.T , which is also selling its stakes.
Indicative bids are due in early May, with binding bids due in mid-August, an Engie spokesman said. Rothschild is advising on the sale process.
Loy Yang B, Victoria's newest and most efficient coal-fired generator, could fetch as much as A$1.5 billion ($1.2 billion), while Kwinana, a 122 MW plant, could sell for around A$150 million, an analyst estimated.
"Loy Yang B we will not close. That's a very, very efficient coal plant," Flachet said, adding that the aim was to complete a sale by next year or continue running the plant.
"If the buyers are interested we will sell both. If they are not interested, we may not sell Kwinana," he said.
Loy Yang B will be essential to ensuring reliable power supplies in Australia's national electricity market following the closure of Engie's Hazelwood plant next month, which supplies up to 5 percent of the market's electricity.
Power reliability has become a hot issue in Australia following a string of blackouts, sparking talk of changes in energy policy and electricity market pricing to ensure there is enough back-up for variable wind and solar power.
($1 = 1.2965 Australian dollars) (Writing by Sonali Paul; Editing by Richard Pullin)