Doreen Power exits gas-fired power, sells final plant as scrap

Doreen Power has decided to sell its last gas-based power plant as scrap, effectively shutting down its electricity generation operations from natural gas.
It will continue generating revenue and profits from its subsidiaries, which are heavy fuel oil-based power plants, until 2037.
"We will have very little impact on our financial results from this decision," said the company's Chief Executive Officer, Mostafa Moin, in a phone conversation with The FE.
Investors need not worry as Doreen Power has already recognized the anticipated loss in its financial statements for FY25, he said.

According to a stock exchange filing on Tuesday, the company's board of directors decided to sell all non-current assets of its Narsingdi 22MW power plant upon the expiry of a 15-year contract with the Bangladesh Rural Electrification Board (BREB).
The company also said it was not interested in renewing the deal.
"We have failed to renew any contract with the government. The plant was in very good condition, but we had no choice," Moin said.
The company has already sold its plants in Tangail and Feni after failing to renew contracts with the government. The same thing happened with the third plant.
Doreen Power started its business with gas-based power plants with a capacity of 22 MW each. However, no revenue has been generated from these plants since 2024.

Moreover, these power plants no longer appear on the company's balance sheet after impairment losses of Tk 917 million were recognized for the Tangail and Feni plants and Tk 410 million for the Narsingdi plant.
An impairment loss is an accounting charge that recognizes a permanent erosion in an asset's value. It occurs when the book value (carrying amount) exceeds the recoverable amount.
As a result, the FY25 solo balance sheet shows assets worth Tk 26,039 under the property, plant and equipment section. These assets were valued at Tk 1.95 billion before the recognition of impairment losses in FY23.
The company also has little expectation regarding the sales proceeds from the Narsingdi plant.
Doreen Power sold the Tangail and Feni plants for more than Tk 200 million, but "we have received slightly more than 75 per cent of the expected sale proceeds so far, as the purchaser is having a hard time selling the second plant," said the CEO.
"We may receive Tk 100 million from the scrap of the Narsingdi plant, but that is not certain," he added.
Out of the company's three HFO-based power plants, with a total capacity of 225 MW, two will see their contracts expire in 2031, while the other will expire in 2037.
According to an expert, allowing the listing of such short-lived companies was a wrong decision.
Meanwhile, Doreen Power's stock rose 2.66 per cent to Tk 30.90 per share on Tuesday on the Dhaka Stock Exchange.
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