Next month, SP Group will rip off consumers and businesses with another round of electricity tariff increase based on oil price increase, not natural gas.
The price of natural gas is almost unchanged from 1 year ago.
The tariff increase will ultimately benefit Temasek Holdings: SP Group is 100% Temasek-owned.
The company supplying natural gas to SP Group, Pavilion Energy, is also another 100% Temasek-owned company.
In 2013, Temasek had set up Pavilion to invest/speculate in natural gas. US$1.3 billion was paid to Ophir Energy Plc for a 20% stake in 3 blocks of natural gas off the Tanzanian coast.
Judging from the collapse of Ophir Energy share price of almost 90%, the investment is likely to yield a negative return, if not wiped out.
Since the price of natural gas is 20% to 40% lower than in 2013, Temasek must have overpaid for its US$1.3 billion investment.
But this will be no issue to Temasek because July’s electricity tariff increase will help to recoup Pavilion’s loss.
How much has Temasek profited from Singaporeans? How much have citizens contributed to paying for Temasek’s investment losses?