PUB issues default notice to Hyflux’s Tuaspring

Photo of TuasSpring power plant from Hyflux's website

A default notice to Tuaspring Pte Ltd (TPL), a subsidiary of Hyflux, was issued by the National water agency PUB to remedy defaults arising under the Water Purchase Agreement (WPA) between PUB and TPL.

The authority stated in a press release on Tuesday (5 March) that TPL is to fully resolve all defaults within default notice period. If it does not, PUB will exercise its right to terminate the WPA and take control of the plant.

This is said to be PUB’s measure to ensure that the water security is safeguarded.

According to PUB, Tuaspring has been unable to fulfil various contractual obligations under the WPA, in particular, by failing to keep the plant reliably operational as required.

In addition, it noted that the TPL has not been able to produce financial evidence to demonstrate its ability to keep the plant running for the next six months.

“PUB has provided sufficient time for TPL to resolve its operational and financial defaults. Given TPL’s current financial position, TPL’s inability to fulfil its contractual obligations is unlikely to change in the immediate to longer term.

PUB and Hyflux Ltd, through its wholly-owned subsidiary, Tuaspring Pte Ltd (Tuaspring),  signed a 25-year Water Purchase Agreement (WPA) on 6 April 2011, for Singapore’s second and largest desalination plant.
Under this agreement, Tuaspring as the concession company, will deliver desalinated water to PUB over a 25-year period from 2013 to 2038.
The desalination plant commenced operations in 2013 and it adds another 70 imperial million gallons (mgd) or 318,500 cubic metres of desalinated water per day to Singapore’s water supply.
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