Egco 06

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4/9/07

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Energy begins to flow,

2_eng

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our imagination flies,

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Happiness begins,

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Combined with energy,

Leading to never-ending learning experience.

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With hard work,

along with strong commitment,

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dreams come true,

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we will progress,

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With energy,

Our progress will add value to our community.

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A touch of nature,

If we use resources wisely,

10_eng

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We will have eternal light,

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With tender care,

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Energy will be available for all generations,

For a bright future.

2006 Highlights EGCO Groupûs activities are based on the philosophy to conduct the business ethically for the benefits of the stakeholders, namely shareholders, customers, suppliers, employees, communities and environment for sustainable development.

Awards and Recognition EGCO July 26 Winning the çBest Corporate Governance Reporté award for 3 consecutive years at the SET Awards 2006, organized by the SET and the Money and Banking Magazine August 18 Being rated the score of 97.44 from the quality assessment of 2006 Annual General Shareholdersû Meeting, organized by the Securities and Exchange Commission November 14 Being rated çvery goodé under the project of Corporate Governance Report of Thai Listed Companies 2006 by Thai Institute of Directors Association Group Companies February 6 March 16 April 20 April 22 May 10 June 9 August 11 August 24 September October 30 November 28 Business Activities March 16 April 24 May 10 September 26 December 1 December 18

KEGCO passing the surveillance audit for ISO 14001 REGCO passing the surveillance audit for ISO 9001:2000 by TUV:NORD REGCO passing the surveillance audit for ISO 14001:2004 by TUV:NORD REGCO being certified the OHSAS 18001: 1999 (Occupational Health and Safety Assessment Series) by RWTUV (Thailand) KEGCO winning the çNational Distinguished Workplace in terms of Safety, Occupational Health and Environmenté for 7 years consecutively hosted by the Ministry of Labor and Social Welfare Roi-Et Green being awarded çthe pleasant walkplaceé on the occasion of His Majesty the Kingûs 60 th anniversary of accession to the throne Roi-Et Green being accredited ISO 14001 : 2004 (Environmental Management System for Operation & Maintenance of Water Treatment Systems and Piping System) from UKAS Environmental Management CURS. KEGCO winning çWorking over 3,000,000 million hours with no disabling injuryé during the period of May 17, 1998 - May 31, 2005 hosted by the Ministry of Labor and Social Welfare REGCO winning the 2006 Asian Power Award for Excellence in Technology Optimization KEGCO passing the surveillance audit for ISO 9001:2000, TIS 18001 & OHSAS 18001:1999 and being re-certified ISO 14001:2004 by TUV:NORD Roi-Et Green passing the surveillance audit for ISO 9001:2000 by Moody International Certification Group Inaugural Ceremony of Roi-Et Green Biomass Power Plant, Roi-Et province 2006 Annual General Shareholdersû Meeting 2005 Final Dividend Payment at 1.75 baht per share 2006 Interim Dividend Payment at 2.00 baht per share Shareholdersû Extraordinary General Meeting no. 1/2006 to consider and approve the connected transaction for the acquisition of shares in BLCP Power Company Limited Signing Tariff Memorandum of Understanding for Nam Theun 1 project between EGCO, Gamuda Berhad and EGAT

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Activities for Shareholders February 4-5 Thai Investorsû Day at the Stock Exchange of Thailand (SET) February 28 Analyst Meeting no. 1/2006 at the SET April 1 Thai Investorsû Day at the SET May 4 çThai Energy Playsé Event in Malaysia June 23 Round Table Discussion no. 1/2006 at EGCO Tower June 25 Money Channel Roadshow in Udonthani province with the SET July 12 Roadshow with the SET and Ministry of Finance in Singapore July 26-27 Investorsû visit to Roi-Et Green Power Plant at Roi-Et province August 21 Analyst Meeting no. 2/2006 at the SET October 13-15 Money Expo in Chiang Mai 2006 November 4-5 Thai Investorsû Day at the SET November 22 Opportunity Day to announce its third quarter performance of 2006 and to clarify the connected transaction on the share acquisition in BLCP Power Company Limited December 14-15 Investorsû visit to BLCP Power Plant and TLP Cogeneration Power Plant at Rayong province Activities for Society and Environment March 27-31 Thai Forest Conservation Youth Camp at Doi Intanond Natural Park, Chiang mai province May 8 Donation of 4 million baht to support the Children and Family Library Project of the Tai Wisdom Association by REGCO and KEGCO May 9-13 EGCO Groupûs Environment Conservation Camp at Doi Intanond Natural Park, Chiang mai province May 22 Donation of 5 million baht to support the exhibition of the sixtieth anniversary celebration of His Majesty the Kingûs accession to the throne May 26 Donation of 1 million baht to relieve the suffering caused by the flash floods in northern provinces May 31 Forest Planting and Construction of check dams to save water to commemorate the sixtieth anniversary of His Majesty the Kingûs accession to the Throne in Rayong province July 21 Construction of Green Classroom Project for Huay Pong School in Rayong province 1 Donation of 5 million baht for the exhibition of the çInternational Horiticulture Exposition : Ratchaphruek August 2006é via the Ministry of Agriculture and Cooperatives August Donation of 5 million baht to support the establishment of the National Discovery Museum Institute October 12-15 Thai Forest Conservation Youth Camp at Kao Luang, Nakhon Sri Thammarat province November 7 Donation of 4 million baht to support the çKnowledge for Thai Children Projecté of the Department of Revenue by ESCO December 24-26 Green Library at Nong Na Sang School in Roi-Et province December 25 Blanket donation to people in Roi-Et province Activities for Employees Communication Day no. 1 January 24 March 17 Annual Physical Check up for Employees March 24 Communication Day no. 2 August 23 In-house training ç7 Habits Courseé October 26 In-house training çThe 4 Roles of Leadership Courseé November 18-20 Family Trip at the çInternational Horiticulture Exposition : Ratchaphruek 2006é in Chiang mai province

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Financial Overview

Consolidated Financial Statements 2006 FINANCIAL PERFORMANCE (M.BAHT) Sales and service income Other income and share of profit (loss) from subsidiaries, an associate and joint ventures Cost of sales and cost of services Administrative expenses and others Impairment charge Interest expenses Profit (loss) attributable to minorities Net Profit (loss) before Fx Fx gain (loss) Net Profit (loss) FINANCIAL POSITION (M.BAHT) Total Assets Total Liabilities Parent没s shareholders没 equity Minority Interest Treasury Stock Issued and paid-up share capital PER SHARE DATA (BAHT) Net Profit (loss) before Fx Net Profit (loss) Book Value Dividend RATIO ANALYSIS Liquidity ratio (Time) Cashflows liquidity ratio (Time) Gross profit ratio (%) Earnings ratio (%) Return on equity ratio (%) Return on assets ratio (%) Debt to equity ratio (Time)

2005 2004

2003 2002

2001

2000 1999

1998 1997

9,697

8,541

8,802

915 777 4,033 3,462 936 1,031 3,299 3,325 203 (38) 3,175 2,694 (236) (1,478) 2,939 1,217

919 2,776 905 2,984 (94) 2,889 (241) 2,648

1,504 1,159 3,677 2,982 383 936 3,302 3,181 (5) (4) 2,950 1,771 3,232 (7,235) 6,181 (5,464)

18,021 16,022 15,620 15,378 11,463 10,732 1,047 8,960 2,949 1,557 332 5,270 766 6,036

832 8,151 2,202 1,859 264 4,378 (285) 4,093

880 7,593 1,894 (34) 2,220 232 4,595 67 4,662

353 6,017 1,323 170 2,631 303 5,287 707 5,994

597 4,926 963 342 2,807 236 2,784 174 2,958

7,709

71,886 61,250 55,066 56,437 55,824 52,965 55,112 49,898 45,113 45,610 35,302 29,136 25,963 29,736 34,876 33,780 37,664 33,079 30,351 36,256 35,410 31,041 28,173 25,895 20,276 18,544 16,979 16,762 14,663 9,280 56 641 469 859 724 1,175 1,073 49 36 982 - (52) (52) (52) 5,265 5,265 5,265 5,265 5,265 5,259 5,244 5,243 5,227 5,200 10.01 11.46 67.26 n/a

8.32 7.78 58.96 3.25

8.75 8.88 53.55 3.00

10.07 11.41 49.21 2.75

5.30 5.62 38.51 2.50

6.04 5.60 35.26 2.25

5.14 2.32 32.38 2.00

5.51 5.05 32.00 2.00

5.65 3.40 11.83 (10.49) 28.07 17.82 1.27

1.69 0.82 50.28 31.66 18.17 9.07 0.96

2.27 1.29 49.13 24.28 13.83 7.04 0.91

3.25 1.33 51.39 28.25 17.28 8.36 0.89

2.19 1.01 60.88 38.10 26.02 10.68 1.11

2.21 1.02 57.02 24.53 15.26 5.44 1.66

2.80 1.01 62.42 25.23 16.55 5.44 1.76

2.85 0.97 64.30 11.62 7.21 2.32 2.16

6.97 1.29 67.50 27.99 16.85 5.57 1.97

4.08 4.77 0.68 1.83 58.22 61.31 59.98 (61.62) 51.63 (43.57) 13.75 (12.21) 2.06 3.89

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Total Revenues 25,000 20,000 15,000 10,000 5,000

19,067 16,854

16,500

15,731 12,060

2006

2005

2004

2003

2002

11,647

10,474

9,460

10,306

8,867

2001

2000

1999

1998

1997

8,268

7,818

6,665

7,362

7,100

2000

1999

1998

1997

2,694

2,889

2,950

Total Expenses Excluding Currency Exchange Gains or Losses 15,000

13,466

12,212

11,673 10,141 9,039

10,000 5,000

2006

2005

2004

2003

2002

2001

Net Profit Excluding Currency Exchange Gains or Losses 6,000 5,000 4,000 3,000 2,000 1,000

5,287

5,270 4,378

4,595 3,175 2,784

1,771

2006

2005

2004

2003

2002

2001

2000

1999

1998

1997

55,066

56,437

55,824

52,965

55,112

49,898

45,113

45,610

1999

1998

1997

Total Assets 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000

71,886 61,250

2006

2005

2004

2003

2002

2001

2000

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3/29/07 7:41:19 PM

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7:42:40 PM

Message from the Chairman

The love and devotion that the Thai people showed on the auspicious day to commemorate His Majesty the King没s 60th year accession to the throne was overwhelming and powerful. It was the opportunity for Thais to express the delight and thankfulness for being his subjects. Amid the winds of changes in the society and heightened divisiveness, the peace and happiness that characterize Thai ways of life would resume if we live by His Majesty没s Sufficiency Economy policy, and to think, talk, and treat each other with kindness. All of this wil lead us to sustainable development.

Energy situation wil continue to be an urgent matter that requires extensive cooperation.

Statistics shows that energy consumption has risen while energy prices continue to soar.

This means the country has to spend a large sum of money purchasing fuel for electricity generation. The solution that both the public and the private sectors seriously adopted last year was the use of alternative energy sources like Bio-Diesel fuel, Natural Gas for Vehicles (NGV) and the use of recyclable energy sources for electricity production. This was done along with campaigns for the private sector to help conserve energy and efficiently use

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energy to stabilize the national supply system. The energy development requires appropriate planning and management as well as natural resource conservation to maintain the ecological balance which wil help mitigate the effect of global warming in the long run so that all of us can live happily together.

We, the Electricity Generating PCL, stil continue to grow our business in a way that wil not harm the environment. Last year, the Company has successfully acquires shares in BLCP power plant, which uses coal as fuel. We also entered into the tariff MoU with the Electricity Generating Authority of Thailand to purchase power from the Nam Theun 1 hydroelectric power project located in the Lao PDR. These two projects support the fuel diversification policy to promote energy stability for Thailand.

EGCO没s operating performance in 2006 was outstanding. The Company posted a net profit of 6,036 mil ion baht or 11.46 baht per share. EGCO paid the interim dividend from the first half year operation at 2 baht per share. We are confident that we wil continuously enhancing our performance.

The Company is well aware that our success is attributed to the support from various concerned parties such as our employees, our shareholders, our customers, our business partners and the society at large. Because of this, we wil adhere to our guiding principles to conduct our business in an ethical and responsible way to avoid the negative impacts from our operation and to provide the benefits to all stakeholders. This business conduct includes the equitable treatment to our employees, transparency for our shareholders, trustworthiness for our customers and friendliness to the environment.

Our commitment is honored by various institutions. The Banking and Finance Magazine and the Stock Exchange of Thailand awarded us the best corporate governance report for three consecutive years from 2004-2006. The Securities and Exchange Commission, Thailand, also appraised the quality of EGCO shareholders没 annual general meeting at 97.44 points.

The Rayong Electricity Generating Co., Ltd, our subsidiary, won the 2006 Asian Power Awards for Excellence in Technology Optimization while Khanom Electricity Generating Co., Ltd won the 莽National Distinguished Workplace in terms of Safety, Occupational Health and Environment茅 for 7 years consecutively from 2000-2006.

On behalf of the Electricity Generating PCL, I would like to thank our shareholders and everyone for your understanding and support which lead to our success. We hope that we wil continue to have your confidence and cooperation in the future to come.

Dr. Pornchai Rujiprapa Chairman

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Board of Directors and Subcommittee Members

1. Mr. Pornchai Rujiprapa

2. Mr. Chaipat Sahasakul

Age 54 Chairman (Authorized Director) Chairman, Executive Committee Education - Ph.D. (Urban & Regional Economics.), University of Pennsylvania, USA - M.Sc. (Urban & Regional Economics.), University of Pennsylvania, USA - M.P.A. (Programming Planning Administration), National Institute of Development Administration (NIDA) - B.Sc. (Agro-Industry), Kasetsart University - Certificate of Directors Accrediation Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience October 2006-Present Chairman Electricity Generating Authority of Thailand December 2006-Present Director PTT Public Company Limited 2006-Present Permanent Secretary, Ministry of Energy 2003-2006 Deputy Permanent Secretary Ministry of Energy 1999-2003 Deputy Secretary General, The National Economic and Social Development Board (NESDB), Office of the Prime Minister

Age 52 Independent Director Chairman, Audit Committee Education - Ph.D. in Economics, University of Rochester, USA - M.A. in Economics, Thammasat University - B.A. in Economics, Thammasat University - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2001-Present Secretary - General Agricultural Futures Trading Commission 2005-2006 Director, Audit Committee Member and Chairman of Risk Management Committee Government Housing Bank 1998-2001 Senior Executive Vice President, MFC Asset Management Public Company Limited 1991-1996 Senior Vice President and Spokesman Stock Exchange of Thailand 1989-1991 Executive Vice President Morgan Grenfell Thai Co., Ltd.

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3. Age Mr.62Aswin Kongsiri ●

Independent Director Nomination and Remuneration Committee Member Education - BA (Honours), Philosophy, Politics and Economics, Oxford University, England - Banff School of Advanced Management, Alberta, Canada - National Defence College, The National Defence Course for the Joint State-Private Sectors, Class 6 - Certificate of Chairman 2000 Program, Thai Institute of Directors Association - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2005-Present Director and Chairman of Risk Management Committee, Bangkok Aviation Fuel Services Public Company Limited 2005-Present Director and Executive Director, Krung Thai Bank Public Co., Ltd. 2003-Present Director and Audit Committee Member, Thai Rating and Information Services Company Limited 2003-Present Director and Chairman of Audit Committee, Thai- German Ceramic Industry Public Company Limited 1999-Present Director and Chairman of Audit Committee, The Oriental Hotel (Thailand) Public Company Limited 1993-Present Director and Audit Committee Member, Thai Reinsurance Public Company Limited 1992-March 2006 Director and Audit Committee Member, Risk Management Committee Member, Chairman of Nomination and Remuneration Committee Muang Thai Life Assurance Company Limited 1981-Present Director and Audit Committee Member, Padaeng Industry Public Company Limited 1994-Present Director Ch. Karnchang Public Company Limited ●

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4. Mr. Worawit Khamkanist

5. Mrs. Wattanee Phanachet

6. Mr. Chareon Prajumtan

Age 67 Independent Director Nomination and Remuneration Committee Member Education - M.Sc. (Mechanical Engineering), University of Alabama, USA - B.Eng. (Mechanical), Chulalongkorn University - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.009 Working Experience 2005-Present Chairman Golden Land Wood Co., Ltd. 2005-2006 Chairman, Sahakarn Wisawakorn Co., Ltd. 2005-Present Chairman, Aqua Plus Company Limited 2001-2004 Managing Director, Aqua Plus Company Limited 1997-2000 Managing Director, Electricity Generating Public Company Limited 1996-1997 President, Mining Business Electricity Generating Authority of Thailand 1990-1995 Assistant Governor, Mae Moh Power Plant, Electricity Generating Authority of Thailand

Age 69 Independent Director Audit Committee Member Education - M.A. Degree in Accounting, University of Alabama, USA - Bachelor Degree in Accounting, Chulalongkorn University, Bangkok, Thailand - Certified Public Accountant (CPA), Thailand License No. 1091 - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2006-Present Committee on Curriculum Quality Guarantee, Faculty of Commerce and Accountancy Chulalongkorn University 2005-Present Head, Sub-Committee on Certified Public Accountantûs Qualification, appointed by the Federation of Accounting Professions.

Federation of Accounting Professions 1999-Present Director and Audit Committee Member, Thai Poly Acrylic Public Company Limited 1999-Present Independent Director and Audit Committee, Capital Nomura Securities 1999-Present Independent Director and Audit Committee, Delta Electronics (Thailand) Public Company Limited

Age 60 Independent Director Audit Committee Member Education - B.Eng. (Civil Engineering), King Mongkutûs University of Technology Thonburi, - B.A. (Law), Sukhothai Thammatirat Open University - MPA, Thammasat University - Certificate of High Level of Engineering Management, Chulalongkorn University and Public Works - Certificate of High Level Administration, The Institute of Administration Department of Provincial Administration - Certificate of Executive Department of The Civil Service Commission - Certificate of Change Management, RIPA International, London - Certificate of Directors Accrediation Program, Thai Institute of Directors Association - Certificate of Audit Committee Program Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience

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2006-Present 2003-2005

2002 2001 1999

Inspector-General, Ministry of Energy Ministry of Energy Deputy Director-General (level 9), Department of Business Energy Ministry of Energy Policy and Plan Specialist (Public Works) Ministry of Energy Inspector-General Ministry of Energy Director of Fuel and Gas Control Division (Engineer level 8) Ministry of Energy

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7:46:39 PM

7. Mr. Sanit Rangnoi

8. Mr. Chamnong Wongsawarng

9. Mr. Sombat Sarntijaree

Age 58 Director (Authorized Director) Nomination and Remuneration Committee Member Education - M.Sc. (Industrial Engineering) from Pennsylvania State University, USA - B.Eng. (Industrial Engineering) from Chulalongkorn University.

- B.A. (Economics), Sukhothai Thammathirat University - Certificate of Directors Accrediation Program, Tha Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2007-Present Director-General, Department of Revenue, Ministry of Finance 2006-Jan, 2007 Director-General, Department of Excise, Ministry of Finance 2004 Deputy Permanent Secretary, Ministry of Finance 2003 Director-General, Department of the Comptroller General, Ministry of Finance 2002 Inspector-General, Ministry of Finance

Age 60 Director (Authorized Director) Executive Committee Member Education - B.Eng. (Electrical Power Engineering), 2nd Class Honors, Chulalongkorn University - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2006-Present Deputy Governor-Transmission System, Electricity Generating Authority of Thailand 2005 Senior Executive Vice PresidentTransmission System, Electricity Generating Authority of Thailand 2003-2005 Deputy Governor-Transmission System, Electricity Generating Authority of Thailand 2001-2003 Assistant Governor-Transmission System Operation Electricity Generating Authority of Thailand

Age 57 Director (Authorized Director) Education - Master of Engineering (Mechanical Engineering), Lamar University, USA - B.Eng. (Mechanical Engineering), Kasetsart University - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience Oct, 2006-Present Deputy Governor-Generation Electricity Generating Authority of Thailand Mar, 2006 Deputy Governor-Sept, 2006 Operation and Maintenance Electricity Generating Authority of Thailand Aug, 2005 Senior Executive Vice -Mar, 2006 President-Operation and Maintenance Electricity Generating Authority of hailand June, 2005Executive Vice PresidentJuly 2005 Power Plant 1, Electricity Generating Authority of Thailand Oct, 2003 Assistant Governor-Power -June 2005 Plant 1 Electricity Generating Authority of Thailand Oct, 2000 Vice President-Generation -Sept 2003 Business 1-Power Plant, Electricity Generating Authority of Thailand

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24

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●

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7:46:17 PM

10. Mr. Peter Albert Littlewood

11. Mr. Richard McIndoe

12. Mr. Hideaki Tomiku

Age 57 Director (Authorized Director) Group Business Committee Member Education - MA (1st Class Honours), Cambridge University, UK Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2003-Present Executive Director and Chief Operating Officer, CLP Power Asia Limited, Hong Kong 2000-2005 Director, Rayong Electricity Generating Co., Ltd. 2000-2005 Director, Khanom Electricity Generating Co., Ltd. 2000-2005 Director, EGCO Engineering & Service Co., Ltd. 1999-2003 Project Manager for CLPûs generating plant projects CLP Group 1998 General Manager for CLPûs generation business group and later for CLP strategic development, CLP Group

Age 42 Director (Authorized Director) Chairman, Nomination and Remuneration Committee Education - Insead Business School (France), Master of Business Administration - Cambridge University (U.K.), Master of Arts, Modern History Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2006-Present Group Director and Managing Director, TRUenergy Australia, CLP Group and TRUenergy Australia 2005-2006 Group Director & Managing Director-Asia Pacific CLP Power Asia Limited, Hong Kong 2003-2005 Managing Director CLP Power Asia Limited, Hong Kong 2002 Finance Director CLP Power International Ltd., Hong Kong 1998-2002 Managing Director InterGen, China 1998-2002 Vice President-Development and Finance InterGen, China 1998-2002 Director UBS Warburg, Hong Kong

Age 49 Director (Authorized Director) Education - International Law, Tokyo University Dispute Family Relationship Amount of Shares (%) 0.00 Working Experience 2006-Present Director and Executive Vice President OneEnergy Limited 2003-2006 Deputy General Manager, Head of International IPP Mitsubishi Corporation 2001-2003 Assistant General Manager, Power, Generation & Marketing for Japanese Market Mitsubishi Corporation

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7:47:57 PM

13. Mr. Mark Takahashi

14. Mr. Visit Akaravinak

Age 48 Director (Authorized Director) Executive Committee Member Education - MBA, Wharton School, University of Pennsylvania, USA - BSc. (civil engineering) from the University of Colorado, USA Dispute Family Relationship Amount of Shares (%) 0.00 Working Experience Oct, 2006-Present Managing Director OneEnergy Limited Jul, 2006 Group Director-Corporate Development CLP Holdings Limited Dec, 2003 Director of Group Treasury -Jul, 2006 CLP Holdings Limited 1995-2003 Regional Finance Intergen (Hong Kong) VP/Corporate Treasurer Intergen, Boston, USA

Age 58 Director and President (Authorized Director) Executive Committee Member Chairman, Risk Management Committee Chairman, Group Business Committee Chairman, Good Corporate Governance Committee Education - B.Eng. (Electrical) Chulalongkorn University - Master of Management from SASIN, Chulalongkorn University.

- Certificate of Management of Public Economyéat the King Prajadhipokûs Institute - Certificate of the Directors Certificate Program, Thai Institute of Directors Association (IOD).

Dispute Family Relationship Amount of Shares (%) 0.00 Working Experience Aug, 2005-Present Chairman, Rayong Electricity Generating Company Limited Aug, 2005-Present Chairman, Khanom Electricity Generating Company Limited Aug, 2005-Present Chairman, EGCO Engineering and Service Company Limited 2003-Jul, 2005 Director, Rayong Electricity Generating Company Limited 2003-Jul, 2005 Director, Khanom Electricity Generating Company Limited

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26

2003-Jul, 2005

● ●

2005-Present

● ● ●

Jun, 2005 -Aug, 2005

2003-2005

1999-2003

1997-1999

Director, EGCO Engineering and Services Company Limited Chairman, Thai Lime Co., Ltd. Senior Executive Vice President-Operation and Maintenance Electricity Generating Authority of Thailand Senior Executive Vice President-Operation and Maintenance Electricity Generating Authority of Thailand Assistant GovernorBangpakong Power Plant Electricity Generating Authority of Thailand Director, Thermal Power Plant Construction, Electricity Generating Authority of Thailand

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4/3/07

6:11:34 PM

Board of Directors and Subcommittee Members with resignation during 2006

1. Mr. Norkun Sitthiphong

2. Mr. Sommai Phasee

Age 54 Director (Authorized Director) Executive Committee Member Vacating the office by resignation on October 31, 2006 Education - National Defence College, 2004-2005 (class 47th) - Ph.D. (M.E.) Oregon State University, USA - M.S. (M.E.) Oregon State University, USA - B.Eng. (Mechanical), Chulalongkorn University Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2003-Present Deputy Permanent Secretary, Ministry of Energy 2003-Oct, 2006 Director, Electricity Generating Authority of Thailand 2003-2004 Director, Ratchaburi Energy Company Limited 2002-2003 Director, Ratchaburi Holdings Public Company Limited 2001-2003 Deputy Dean (Research and Asset), Chiang Mai University, Chiang Mai University 1998-2000 Deputy Dean (Education), Chiang Mai University

Age 62 Interim Chairman Independent Director Executive Committee Member Nomination and Remuneration Committee Member Vacating the office by resignation on May 1, 2006 Education - M.Sc. (Economics), Thammasat University - M.Sc. (Economics Planning and Development), Vanderbilt University, USA - Certificate of Chairman 2000 Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience

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Nov, 2006-Present 2005-Nov, 2006 2004-Nov, 2006 2004-2006

3. Mr. Chai-Anan Samudavanija

Age 62 Chairman (Authorized Director) Chairman, Nomination and Remuneration Committee Vacating the office by resignation on February 17, 2006 Education - Honorary Ph.D., National Institute of Development Administration - Honorary Ph.D. University of Edgewood - Honorary Ph.D. and Distinguished Alumni, University of Wisconsin - Honorary Certificate, National Defence College - Certificate in Social Planning United Nations Asian Institute - Ph.D. University of Wisconsin (Madison), USA - M.A. University of Wisconsin (Madison),USA Deputy Minister of Finance, - B.A. Victoria University of Wellington, Ministry of Finance Chairman, New Zealand The Thai Bond Market Law major, Faculty of Political Science, Association Chul a longkorn University Member of appealing Di s pute Committee, Securities and Exchange Commission, Thailand Family Relationship Chairman, Amount of Shares (%) 0.000 Gulf Electric Public ● ●

Working Experience

2004-Nov, 2006 2002-Feb, 2005 2003-Nov, 2006

2004-Nov, 2006 1998-2004 1998-2003

Company Limited Chairman, Thai Bond Dealing Centre Chairman, Thai Maritime Navigation Company Limited Chairman of Executive Committee, Thai Military Bank Public Company Limited Chairman, ASEAN Potash Mining Public Company Limited Deputy Permanent Secretary, Ministry of Finance Director, Electricity Generating Authority of Thailand

2004-Feb, 2006 1999-Dec, 2006 1999-Dec, 2006 1999-Present 1996-Present

Chairman, Electricity Generating Authority of Thailand Independent Director, Thai Airway Public Company Limited Independent Director, Krung Thai Bank Public Company Limited Vice President, The Royal Institute of Thailand Director, Vajiravudh College

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7:48:52 PM

4. Mr. Charu-Udom Ruangsuvan

5. Mr. John Wil iam Hancock Age 60 Independent Director Retired by rotation in 2006 AGM Education - LL.B., University of Adelaide, South Australia - Certificate of Chairman 2000 Program, Thai Institute of Directors Association - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000

6. Mr. Paiboon Thepmongkol

Age 61 Director (Authorized Director) Vacating the office by resignation on October 7, 2006 Education - B.Eng. (Mechanical), Chulalongkorn University - Certificate of the Civil Service Executive Development Program 1, Office of Civil Service Commission - Laos Hydro Power Towards 2015 - Steam Turbine and Generator Service User Group Meeting, Germany Working Experience - The Civil Service Executive Development 2004-Present Honorary Chairman and Program 1, Office of Civil Service Commission Senior Advisor Working Experience Dispute Baker & McKenzie Ltd., Bangkok Family Relationship 1993-1996 President/Chief Executive Officer Malaysia-Thailand Joint Authority 2005-Present Independent Director Amount of Shares (%) 0.000 Indorama Polymers Working Experience 1991-1992 Deputy Permanent Secretary Public Company Limited 2003-Oct, 2006 Deputy Governor-Power Plant, Ministry of Industry 1999-Present Independent Director Electricity Generating 1990 Inspector-General Siam Commercial Bank Authority of Thailand Ministry of Industry Public Company Limited 1999--2003 Assistant Governor-Hydro Power 1984-1989 Deputy Director-General, Operation, Department of Mineral Resource 1994-Present Independent Director Serm Suk Public Company Limited Electricity Generating Ministry of Industry 1978-2003 Chairman and Senior Partner, Authority of Thailand Baker & McKenzie Ltd., Bangkok 1998-1999 Assistant Governor-Hydro Plant, Electricity Generating Authority of Thailand 1996-1999 Director, Bhumibol Hydro Plant, Electricity Generating Authority of Thailand

Age 74 Independent Director Audit Committee Member Retired by Rotation in 2006 AGM Education - National Defence College, 1984 (Class 27th) - LL.B., Thammasat University - B.Eng. (Mining), The University of Adelaide, Australia - Certificate of Directors Accrediation Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000 ● ●

28

●

●

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7. Mr. Sahai Rakyao

8. Mr. Kitti Sirikwin

9. Mr. Michael Irl Nikkel

Age 61 Director (Authorized Director) Nomination and Remuneration Committee Member Vacating the office by resignation on October 7, 2006 Education - B.Eng. (Mine Engineering) Chulalongkorn University - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000

Age 61 Director (Authorized Director) Group Business Committee Member Vacating the office by resignation on October 7, 2006 Education - Certificate, Advanced Management Program (AMP), Harvard Business School, USA - Master of Engineering (Structural Engineering & Mechanics) Asian Institute of Technology - B.Eng. (Civil Engineering), 2nd Class Honors, Chulalongkorn University - Certificate of Directors Certification Program, Thai Institute of Directors Association Dispute Family Relationship Amount of Shares (%) 0.000

Age 43 Director (Authorized Director) Executive Committee Member Vacating the office by resignation on October 27, 2006 Education - Juris Doctor Degree-Law, University of Minnesota Law School - Bachelor of Arts Degree-Education, Southwestern Oklahoma State University Dispute Family Relationship Amount of Shares (%) 0.000

● ●

Working Experience

Jun, 2005 -Oct, 2006 Oct,2003 -Jun, 2005 1999-2003

1999

Senior Executive Vice President-Fuel Electricity Generating Authority of Thailand Deputy Governor-Fuel Electricity Generating Authority of Thailand Vice President-Fuel Business-Production Electricity Generating Authority of Thailand Energy Resources Engineering Division Manager Electricity Generating Authority of Thailand

● ●

● ●

Working Experience

2006 2003-2005

Working Experience

2005 -Oct, 2006 2003-2005

1998-2003 1994-1998

President, Development Business 1999-2003 Electricity Generating Authority of Thailand Deputy Governor-Transmission System Development 1998-2003 Electricity Generating Authority of Thailand Director, Civil Engineering Division 1996-1999 Electricity Generating Authority of Thailand Assistant Governor-Thermal Power Plant Construction Electricity Generating Authority of Thailand

Managing Director-Southeast Asia CLP Power Asia Executive Director-Head of Southeast Asia CLP Power Asia Limited Director, Vice President and Chief Financial Officer AES China Generating Company Limited Director and Vice President AES Orient, Inc., Hong Kong Legal Counsel The AES Corporation, Washington, USA

29

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Board of Directors and Subcommittee Members The positions of the Management and the Control

10. Mr. James Richarde Truscott

1. Mr. Somyos Polachan

Age 44 Director (Authorized Director) Risk Management Committee Member Vacating the office by resignation on June 23, 2006 Education - B.Sc. (Mechanical Engineering), Texas A&M University, USA - MBA, Texas A&M University, USA Dispute Family Relationship Amount of Shares (%) 0.000

Age 61 Senior Executive Vice President-Asset Management and Planning Risk Management Committee Member Group Business Committee Member Good Corporate Governance Committee Member Education - B.Eng. (Honors), Chulalongkorn University - High Certificate in Nuclear Engineering, Chulalongkorn University - Advance Certificate in Electricity Utilities Management, Austin, Texas, USA Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience

● ●

Working Experience

May 2004 -Present

Managing Director Power Generation Services Company Limited 1999-Jan, 2005 Managing Director CLP Power (Thailand) Limited 2001-2003 Managing Director BLCP Power Company Limited 1999 Director Project Development, Southeast Asia, Bangkok, Thailand Coastal Power Company 1996-1998 Director Project Development, Southeast Asia, Jakarta, Indonesia Coastal Power Company

Age 43 Senior Executive Vice President-Business Development Risk Management Committee Member Good Corporate Governance Committee Member Education - Bachelor of Science in Mechanical Engineering (Honors), Columbia-University, School of Engineering and Applied Science, New York.

Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2005-Present Director 2000-Dec, 2005 Director and Managing Director EGCO Joint Ventures & EGCO Engineering & Service Company Limited Development Company Limited 2003-Jan 2007 Director 2004-Present Di rector Rayong Electricity Generating Gul f Electric Public Company Limited Director Company Limited Khanom Electricity Generating 2004-Present Director Company Limited Nam Theun 2 Power Chairman Thai LNG Power Corporation Limited Company Limited Chairman 2003-2004 Independent Consultant to TLP Cogeneration Company Limited the Managi n g Director and Chairman EGCO Green Energy Company Limited the Head of the Southeast Chairman Asia Business Roi-Et Green Company Limited China Light & Power Group Director EGCO Joint Ventures & (Hong Kong) Development Company Limited 2003-2004 Team Leader & Infrastructure Director Speci a list, Amata-EGCO Power Company Limited 2004-Present Director ADB Technical Assistance Program Amata Power (Bangpakong) 2003 Independent Consultant to Company Limited Chief Executive Officer 2003-2005 Chairman Egcom Tara Company Limited International Power PLC. 2000-2003 Director 1995-2003 Pri ncipal and Managing Director Egcom Tara Company Limited Del ta Associates (Thailand) Limited 1996-1999 Executive Director ●

● ● ●

& Project Director Thai-Lao Power Company Limited 30

2. Mr. John M. Palumbo ●

● ●

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3. Mr. Sakda Sreesangkom

4. Mr. Sinchai Nerngjumnong

5. Mr. Chankij Jearaphunt

Age 44 Senior Executive Vice President-Finance Risk Management Committee Member Group Business Committee Member Good Corporate Governance Committee Member Education - M.A. (Economics), Keio University, Japan - B.A. (Economics), Thammasat University Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience

Age 59 Senior Executive Vice President Risk Management Committee Member Good Corporate Governance Committee Member Education - B.Eng. (Mechanical Engineering), 2nd Class Honors, Chulalongkorn University Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2002-Present Director and Managing Director Rayong Electricity Generating Company Limited 2001-2002 Director and Managing Director Khanom Electricity Generating Company Limited 1997-2001 Deputy Managing Director Rayong Electricity Generating Company Limited 1994-1996 Operation Division Manager Rayong Electricity Generating Company Limited

Age 52 Senior Executive Vice President Risk Management Committee member Good Corporate Governance Committee Member Education - Master of Public Administration(MPA) National Institute of Development Administration (NIDA) - B.Eng. (Electrical Engineering), Chulalongkorn University Dispute Family Relationship Amount of Shares (%) 0.000 Working Experience 2004-Present Director and Managing Director Khanom Electricity Generating Company Limited 2006-Present Director EGCO Green Energy Company Limited 2006-Present Director Roi-Et Green Company Limited 2002-Present Director Gulf Cogeneration Company Limited 2002-Present Director Nongkhae Cogeneration Company Limited 2002-Present Director Samutprakarn Cogeneration Company Limited 1998-2004 Deputy Managing Director-Operation, Khanom Electricity Generating Company Limited 1996-1998 Manager-Production Control Division Khanom Electricity Generating Company Limited

● ● ● ●

2005-April 06 Chairman Egcom Tara Company Limited 2002-Present Director Rayong Electricity Generating Company Limited Khanom Electricity Generating Company Limited EGCO Engineering & Service Company Limited EGCO International (BVI) Limited EGCO Joint Ventures & Development Company Limited 2002-2005 Director Egcom Tara Company Limited 2002-Present Director Amata-EGCO Power Company Limited 2002-2003 Director Amata Power (Bangpakong) Company Limited 2001-2002 Senior Vice President Glow Company Limited, Tractebel Group 2000-2001 Asian Development Bank Consultant to Public Debt Management Office, Ministry of Finance ADB Technical Assistance Program 1999-2000 Financial Consultant Debt management consultancy to EGAT and PEA 1997 -1999 Executive Director SBC Warburg (Hong Kong, Bangkok) 1990-1997 Vice President Credit Suisse First Boston (New York, Singapore, Bangkok) 1987-1989 Analyst Nikko Securities (Tokyo)

● ● ●

● ● ●

31

Company's Management

1

2

3

4

5

6

1. Mr. Voravit Potisuk Executive Vice President-Business Development

2. Ms. Vasana Vongpromek Executive Vice President-Corporate Service Group

3. Ms. Pikul Sreesastra Executive Vice President-Controller Group

4. Ms. Daranee Sriwattana Executive Vice President-Asset Management and Planning

5. Mr. Wajarapong Palakawong Na Ayudhya ESCO Deputy MD-Operation

6. Dr. Sakul Pochanart Executive Vice President-Project Management 32

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7

8

9

10

11

12

7. Mr. Chumsak Desudjit REGCO Deputy MD-Operation

8. Ms. Ngamphis Chitphromphan KEGCO Deputy MD-Finance & Administration

9. Ms. Warunee Tantiwong REGCO Deputy MD-Finance & Administration

10. Ms. Krisna Pinkaew ESCO Deputy MD-Finance & Administration

11. Mr. Mana Vitavasakul KEGCO Deputy MD-Operation

12. Mr. Rasda Pongpaew ESCO Managing Director 33

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The Positions of EGCO没s Management and the Control Persons in the subsidiaries and other related companies as of December 31, 2006

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35

The Positions of REGCO没s Management and the Control Persons in EGCO group companies as of December 31, 2006

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36

4/3/07 9:39:29 PM

4/3/07

The Positions of TLP Cogen没s Management and the Control Persons in EGCO group companies as of December 31, 2006

The Positions of KEGCO没s Management and the Control Persons in EGCO group companies as of December 31, 2006

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37

Shareholding and Management Structure EGCOûs registered capital is as shown in the following table.

Category Registered Capital Paid Up Capital

No. of Shares (mil ion shares) 530 526.465

Amount (mil ion baht) 5,300 5,264.65

The top ten shareholders as of November 13, 2006, the closing date of shareholdersû roster for the right to attend the Shareholdersû Extraordinary General Meeting no. 1/2006 on December 1, 2006, were as follows.

No. 1 2 3 4 5 6 7 8 9 10 Remarks

Shareholders

/1

Electricity Generating Authority of Thailand CLP Power Projects (Thailand) Limited State Street Bank and Trust Company, for London Littledown Nominees Limited 9 Chase Nominees Limited 1 State Street Bank and Trust Company Littledown Nominees Limited Bangkok Life Assurance co., Limited Chase Nominees Limited Norbax Inc., 13 /1

Shares

% of Total

133,773,662 118,023,606 16,414,343 11,507,847 9,821,438 9,792,324 9,211,100 6,665,700 5,977,841 5,873,900

25.41 22.42 3.12 2.19 1.87 1.86 1.75 1.27 1.14 1.12

excluding 51,836,316 shares under Thai NDVR which account for 9.85% of the total outstanding shares

Two major controlling shareholders are as follows.

1. Electricity Generating Authority of Thailand (çEGATé): EGAT was incorporated under the criteria set forth in the State Enterprise Capital Act with the objectives to generate, purchase, transmit and distribute electricity. EGAT also provides the operation and maintenance services and invested in the electricity related business.

As the major shareholder, EGAT has four representative directors of all 14 directors 2. CLP Power Projects (Thailand): CLP Power Projects (Thailand) is a wholly owned subsidiary of OneEnergy Limited, a 50:50 joint venture between CLP Holding Limited and Mitsubishi Corporation. OneEnergy Limited has the objective to invest in power business in the Southeast Asia and Taiwan.

As a major shareholder, CLP Power Projects (Thailand) has four representative directors in the Company.

38

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Organization Structure At the top of EGCO没s organization structure is the Board of Directors, the standing committees, the President and the top management.

1. Board of Directors The Board of Directors has main responsibility to conduct a business in a way that will benefit the Company, shareholders and stakeholders including the employees and communities where the Company operates its business. The Board of Directors works with the Management in formulating the Company没s vision and policy and to approve the annual budget.

Currently, the Board of Directors comprises 14 members: 13 non-executives (including five independent directors), and President The Board of Directors and their share ownership in the Company as of December 31, 2006 were as listed below: No. of Shares December 31, Increase 2006 (Decrease)

No. of shares Name

No.

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Mr. Pornchai Rujiprapa Mr. Chaipat Sahasakul Mr. Aswin Kongsiri Mr. Worawit Khamkanist Mr. Chareon Prajumtan Mrs. Wattanee Phanachet Mr. Sanit Rangnoi Mr. Chamnong Wongsawarng Mr. Sombat Sarntijaree Mr. Peter Albert Littlewood Mr. Richard McIndoe Mr. Hideaki Tomiku Mr. Mark Takahashi Mr. Visit Akaravinak

Position

Chairman Independent Director Independent Director Independent Director Independent Director Independent Director Director Director Director Director Director Director Director President

Appointment Date November 27, 2006 April 25, 2005 April 24, 2006 April 26, 2004 June 26, 2006 December 1, 2006 November 27, 2006 November 27, 2006 November 27, 2006 April 25, 2005 April 25, 2005 June 26, 2006 October 30. 2006 August 1, 2005

December 31, 2005 48,100 -

48,100 -

-

39

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The list of directors who retired or resigned in 2006 together with their share ownership in the Company was as shown below.

Name

No.

1 2

Mr. Chai-Anan Samudavanija Mr. Sommai Phasee

3 4 5 6 7 8 9 10

Mr. Norkun Sittipong Mr. Charu-Udom Rangsuwan Mr. John Wil iam Hancock Mr. Sahai Rakyao Mr. Kitti Sirikwin Mr. Paiboon Thepmongkol Mr. Rick Truscott Mr. Michael Irl Nikkel

Position

Chairman Independent Dzirector and Acting Chairman Chairman Independent Director Independent Director Director Director Director Director Director

Retiring/ Resigning Date

No. of Shares December 31, Increase 2006 (Decrease)

No. of shares December 31, 2005

February 17, 2006 May 1, 2006

1

1

-

October 31, 2006 April 24, 2006 April 24, 2006 October 7, 2006 October 7, 2006 October 7, 2006 June 23, 2006 October 27, 2006

3,200 2,000 -

2,200 2,000 -

(1,000) -

Independent Directors The Board has defined the qualifications of independent directors which either meet or exceed the independence standard set forth in the Notification of the Stock Exchange of Thailand (çSETé) regarding the qualifications of independent directors, dated October 28, 1993 and the letter of the Securities Exchange Commission (çSECé) no. SEC Jor. (Wor) 54/2004 dated December 1, 2004. To be considered çindependenté for purposes of director qualification standards, the director must possess the following qualifications.

1. Holding shares not more than 2% of the paid-up capital with the voting right of the Company, affiliated company, associated company or related company, which shall be inclusive of the shares held by related persons. (including the connected persons as stipulated in section 258 of Securities and Exchange Act) 2. Not taking part in the management of the Company, affiliated company, associated company, related company or majority shareholder of the Company, and not being an employee, staff member or advisor who receives a salary from the Company, associated company, related company or majority shareholder of the company.

3. Not being a person who is related by maternity and by registration in case of being parents, spouse, brother, sister, son and daughter, including sonûs and daughterûs spouse of the management, or major shareholders or whoever that has the conflict of interests with the Company or subsidiary.

4. Having no direct or indirect benefit or interest in finance and management of the Company, affiliated company, associated company, related company or majority shareholder of the Company, including the benefit or interest of the said nature during the period of 1 year before his appointment as Independent director except where the 40

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board of directors has carefully considered that such previous benefit or interest does not affect the performance of duties and the giving of independent opinions.

5. Not being appointed as a representative to safeguard interests of the Company没s director, majority shareholders or shareholders who are related to the Company没s majority shareholders.

6. Being capable of performing duties, giving opinions or reporting the results of performance of work according to the duties delegated by the Board of Directors, free from the control of the management or the majority shareholders of the Company including related persons or close relatives of the said persons.

The Nomination and Remuneration Committee shall review the appropriateness of the definition. Currently, there are 5 independent directors of all 14 directors which accounts for more than the one-third proportion of all directors.

Authorized Directors To maintain the independence of independent directors, the Company determines the authorized directors comprising Chairman or President to sign and affix the Company没s seal independently, or any two directors, excluding the independent directors, are authorized to sign jointly and affix the Company没s seal.

Appointment, Resignation, and Dismissal of Directors The Board of Directors which comprises not less than five and not more than 15 directors shall be elected by shareholders, provided that not less than half of the directors must reside in Thailand. If a directorship becomes vacant for any reason other than by rotation, the Board of Directors in the subsequent meeting shall elect a person who is qualified to fill in the vacancy by the votes of not less than three-forth(3/4) of the remaining directors. The 41

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director who fills in the vacancy shall retain the office for only the remaining term of office of the director whom s/he replaces.

At every annual ordinary meeting, one-third of the directors shall retire from office. If the number of directors is not a multiple of three, the number nearest to one-third must retire from office. Additionally, any director who wishes to resign from office may do so by submitting a resignation letter to the Company. Such resignation shall be effective from the date the resignation letter reaches the Company.

In voting for the dismissal of any directors from office before the expiration of his or her term of directorship, a four-fifth (4/5) vote of eligible shareholders present at the meeting shall be required.

Board of Directorsรป Duties and Responsibilities The duties and responsibilities of the Board of Directors are as prescribed below.

1. Duties to the Company To devote time to the Company and conduct the business in compliance with the governance principles and the Companyรปs Code of Conduct.

To demonstrate independent judgment in overseeing the Company business.

To have full ethical and legal responsibility towards shareholders while taking into account the interests of other stakeholders.

To endeavor to recruit competent key management who will fully devote themselves for the benefit of the Company.

To monitor the Companyรปs business and the compliance with the laws, rules, regulations and contract provisions and will require the Management to submit report on the Companyรปs significant matters to ensure effective corporate performance.

2. Duties to the Shareholders To endeavor to ensure that the Company is financially viable, properly managed and constantly improved so as to protect and enhance the interests of the shareholders.

To endeavor to ensure that the information disclosure is materially correct, complete, transparent and timely.

To endeavor to ensure that shareholders are treated on equitable basis.

Not to submit fault information and will ensure that true and accurate information regarding the operating results a nd financial position is reported in accordance with the disclosure requirements.

3. Duties to Creditors To endeavor to ensure that the Company complies with the loan provision and the Company financial status is correctly disclosed.

To seek professional advice in case of doubt about the likely impact on lenders such as when the Companyรปs financial position is uncertain or insolvency may be pending.

4. Duties to other Stakeholders To endeavor to ensure that the Company complies with the governing laws and regulations while taking into account the impact on employees, other stakeholders, community, society and environment.

5. Due Diligence To attend all Board meetings but where attendance at meetings is not possible, to take appropriate step to obtain leave of absence.

42

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To acquire knowledge about the Company, the statutory and regulatory requirements affecting the discharge of the duties as a director of the Company, and to be aware of the environment that has the impact on the Company.

To endeavor to ensure that necessary data are provided in advance to allow adequate time to analyze, make thorough judgment and so discharge the duties of care and diligence.

To endeavor to ensure independent judgment and in case of dissent to any Boardûs resolution, may request the record of objection in the Minutes of Meeting.

To endeavor to ensure that the system is established within the Company to provide the Board, on a regular and timely basis, with necessary data to enable a reasoned and careful judgment.

To endeavor to make sure that relations between the board and the auditors are open and that the auditor can work independently and efficiently with the full co-operation from management and the internal auditors.

To strive to ensure that the Company complies with the governing laws, rules, regulations and business standard and ethics.

In any case of doubt in the capacity of directors and committee members, to seek advise from the Companyûs advisors who are experts in each areas and to engage independent advisors for the governance benefits such as legal advisors, financial advisors, HR advisors, other professional advisors on the Companyûs expenses.

Board of Director Evaluation By the Boardûs resolution, the Board approved the Boardûs self appraisal form reviewed by the Nomination and Remuneration Committee which covers the following four areas.

Meetings and directors Communication efficiency Working process Relationship with Management The scores and directorsû recommendations in each area are taken into consideration for directorsû improvement.

2. Standing Committeesû Structure The Board of Directors has appointed 3 standing committees to help scrutinize significant matters. The details of the standing committees are as follows.

Audit Committee The Audit Committee comprises 3 independent directors for a 3-year term of service, with one year for this purpose meaning the period between the Annual General Meeting (çAGMé) of shareholders when s/he is appointed and the next succeeding AGM. As of December 31, 2006, the Audit Committee comprises the following directors.

No. Name 1 Mr. Chaipat Sahasakul

Position Chairman

2 3

Director Director

Mr. Chareon Prajumtan Mrs. Wattanee Phanachet

Remarks Independent director with finance and accounting background Independent director with business background Independent director with finance and accounting background 43

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The Audit Committee undertakes its responsibilities as described in the Audit Committee Charter, which is reviewed annually to be consistent with the changing internal and external environment. The responsibilities of the Audit Committee are detailed below.

1. To review the accuracy and adequacy of EGCOûs financial reporting.

2. To review the appropriateness and effectiveness of internal control systems, Management Control and internal audit functions.

3. To monitor EGCOûs compliance with Securities and Exchange Acts and Regulations of the SET, and any other laws relevant to EGCOûs business.

4. To recommend the Board of Directors the external auditing firm as well as the audit fees for appointment by the shareholders to audit EGCOûs financial statements.

5. To consider the accuracy and adequacy of EGCOûs disclosure on related-party transactions or any transactions that may cause conflict of interest.

6. To review the Internal Audit Charter prior to submitting to the Board of Directors for approval.

7. To approve the internal audit plan as well as budget and personnel.

8. To review the internal audit function, including: independence of internal audit division and reporting obligation.

9. To approve the appointment, rotation, removal and performance appraisal of the Chief Internal Audit 10. To review or modify the Code of Conduct prior to submission to the Board of Directors for consideration.

11. To review with Management the methodology to encourage compliance with EGCOûs Code of Conduct.

12. To review with Management the preparation of 44

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Managementûs Discussion and Analysis or MD&A and its disclosure in the Annual Report.

13. To review with the Management the financial management and financial risk management.

14. To prepare a report that describes the Audit Committeeûs activities and responsibilities. This report shall be signed by the Chairman of the Audit Committee and published in the annual report to the shareholders.

15. To direct and supervise an investigation into any matter as deemed necessary to accomplish the Committeeûs responsibility 16. To review the Audit Committee Charter at least annually.

17. To perform any other act as assigned by the Board of Directors with approval of the Audit Committee.

The Audit Committee conducts the self-appraisal annually and reports the result to the Board. The result indicates that the composition, qualifications and performance of the Audit Committee are in line with the recommendations of the SET and the international best practice.

There were 20 meetings in 2006 of which the attendance rate was 100%.

Executive Committee The Executive Committee comprises 5 directors of which the office term is the same as their board directorship.

As of December 31, 2006, the Executive Committee comprises the following directors.

No. 1 2 3 4 5

Name Mr. Pornchai Rujiprapa Mr. Chamnong Wongsawarng Mr. Richard McIndoe Mr. Mark Takahashi Mr. Visit Akaravinak

Position Chairman Director Director Director Director

Remarks Non-Executive Director Non-Executive Director Non-Executive Director Non-Executive Director Executive Director

The Executive Committee governs the Companyûs business within its delegated authority as well as scrutinizes other matters to be proposed to the Board. The detailed responsibilities are described below.

1. To consider EGCOûs business plan and annual budget for presentation to the Board of Directors.

2. To consider and to approve investments and divestments of assets, credit, borrowings, debt restructuring, expenditures, other financing transactions and financial instruments, according to the Companyûs table of authority approved by the Board.

3. To formulate the overall investment strategy and investment policies in line with the EGCOûs own policy, and to approve investment guidelines and investment requests in accordance with the Companyûs regulations.

4. To consider and take action on other important issues relating to the Companyûs operations.

5. To screen issues and make recommendations prior to their submission to the Board of Directors.

6. To propose the establishment and assessment of corporate KPI for approval by the Nomination and Remuneration Committee.

7. To propose/endorse the organizational structure, restructuring and governance of EGCO (Division level up) 8. To consider issues which are assigned by the Board.

There were 18 meetings in 2006 of which the attendance rate was 98%.

45

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Nomination and Remuneration Committee The Nomination and Remuneration Committee comprises 4 directors for a 3-year term of service with one year for this purpose meaning the period between the AGM of shareholders when s/he is appointed and the next succeeding AGM. As of December 31, 2006, the Nomination and Remuneration Committee comprises the following directors.

No. 1 2 3 4

Name Mr. Richard McIndoe Mr. Sanit Rangnoi Mr. Aswin Kongsiri Mr. Worawit Khamkanist

Positon Chairman Director Director Director

Remarks Non-Executive Director Non-Executive Director Independent Director Independent Director

The mission of the Nomination and Remuneration Committee is detailed below.

1. To recommend the structure and composition of the Board and committee together with the qualification of its members.

2. To recommend the list of nominees for the Board of Directors to be proposed to the shareholders没 AGM in case of vacancies by rotation and to the board in case of casual vacancies.

3. To recommend committee members as well as directors to oversee the functions and participate as members in the Company没s risk management committee.

4. To scrutinize the list of nominees for the chief executive officer of the Company in case of vacancy including the establishment of the succession plan for executives.

5. To approve the appointment, promotion, rotation and removal of the senior executives of EGCO (Executive Vice Presidents and Senior Executive Vice Presidents) and Managing Directors and Deputy Managing Directors of the wholly owned subsidiaries.

6. To approve Company representatives to be directors of the subsidiary or associated companies according to equity proportion or shareholders没 agreement.

7. To endorse the performance evaluation of EGCO President.

8. To endorse the performance evaluation of EGCO Management (Senior Executive Vice President and Executive Vice President).

9. To recommend the remuneration structure of the directors and senior executives of the Company and subsidiary and associated companies including meeting allowances, bonus, welfare and other benefits both in monetary and non-monetary terms.

10. To recommend policies and guidelines in determining the remuneration package of the senior executives on an annual basis.

11. To evaluate the corporate performance of the Company to determine the bonus and annual salary increase across the Company.

12. To recommend the Company没s salary structure and other benefits.

There were 11 meetings in 2006 of which the attendance rate was 98%.

3. Management Structure The President acts as the head of the Management team with 6 business units: 3 major business units namely Business Development, Asset Management and Planning and Finance with Senior Executive Vice President as a Group Head, 3 supporting business units namely Controller, Corporate Service and General Counsel and Corporate Secretary with Executive Vice President as a Group Head, 46

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2 divisions under the Presidentûs supervision namely Corporate Communication and the Internal Audit which directly reports to the Audit Committee

President The President is responsible for governing the companyûs business in consistent with the Companyûs objectives, articles of association, regulations and the resolution of the Board. The President is also in charge of supervising employees and complete activities assigned by the Board including the following activities.

To operate day-to day business, To hire, appoint, remove, transfer, promote, demote, assign, take disciplinary action against employees and workers from division managers downward (excluding the internal audit manager), To ensure the implementation of the policies, plans, and budgets approved by the Board.

In this respect, the President is allowed to delegate his authority to other employees but is still accountable for the decision of his delegate.

Management The list of the Management team and their share ownership in the Company as of December 31, 2006 is as follows.

Name

No. 1 2 3

Mr. Visit Akaravinak Mr. Sakda Sreesangkom Mr. John Palumbo

2

Mr. Somyos Polachan*

4

Mr. Sinchai Nerngjumnong

5

Mr. Chankij Jearaphunt

Title President Senior Executive Vice President-Finance Senior Executive Vice President-Business Development Senior Executive Vice President-Asset Management and Planning Senior Executive Vice President and Managing Director of REGCO Senior Executive Vice President and Managing Director of KEGCO

No. of Shares December December 31, 2006 31, 2005

No. of Shares Increase (Decrease)

-

-

-

2,000

2,000

-

-

-

-

-

-

-

Remark * Mr. Somyos Polachanûs contract as SEVP-AMP expired on December 31, 2006.

Corporate Secretary The Company has set up the Corporate Secretary Division with Ms. Busakorn Kakanumpornwong, Senior Vice President as the division manager to handle and carry out functions to assist the Board as well as to coordinate subsequent actions under the Boardûs resolution: To provide primary advice pertaining to the Companyûs regulations and articles of association to monitor to ensure regulatory compliance on a regular basis, and to report any significant changes to the directors, To arrange meetings of shareholders and the Board of Directors in accordance with the laws and regulations, including the Companyûs articles of associations and procedures, To prepare meeting minutes of shareholders and the Board of Directors, and monitor to ensure compliance with resolutions of shareholdersû and Board meetings, To ensure that corporate information disclosure to regulatory agencies is in accordance with the laws and the SECûs and SETûs regulations, 47

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To inform general shareholders of their legitimate rights and the Companyûs information, and To facilitate the Board's activities.

Management Committees The Company has set up the following committees to ensure of the appropriateness and efficiency of business management.

Group Business Committee: The Board of Directors appoints the Group Business Committee which comprises outside professionals and Executives of EGCO Group in the appropriate number, chaired by the President. The term of office for the outside professionals is 1 year, with a year for this purpose meaning the period between the AGMs of REGCO KEGCO and ESCOûs shareholders when s/he is appointed as a director and the next succeeding AGMs. The term of office for the executives is the same as their executive terms.

As of December 31, 2006, the members of the Group Business Committee are as shown below: Title 1 2 3 4 5 6 7 8

President Senior Executive Vice President-Finance Senior Executive Vice President-Asset Management and Planning Senior Executive Vice President and Managing Director of REGCO Senior Executive Vice President and Managing Director of KEGCO Executive Vice President and Managing Director of ESCO Mr. Kitti Sirikwin Mr. Kwok Wing Ho

Position Chairman Member Member Member Member Member Member (outside professional) Member(outside professional)

The Group Business Committee is accountable for the following responsibilities 1. To act as the Board of Directors of the 100% equity subsidiaries namely REGCO, KEGCO, and ESCO. 2. To oversee that the operating assets comply with laws, regulations, governing documents and the Companyûs regulations.

3. To consider and endorse the business plan, annual budget and KPIs for the operating assets to the Executive Committee for its consideration.

4. To direct the Companiesû operations and asset management functions to comply with the corporate plan and budget and meet both the short-term and medium-term corporate targets.

5. To oversee the Companyûs operating assets to ensure that the operating results and return on investment are in line with the plan and projection under the support of the Asset Management and Planning Group.

6. To propose/endorse the organizational structure, restructuring and governance of Group Companies (Division level up).

7. To recommend the appointment, rotation and removal of the Managing Directors and Deputy Managing Directors of the wholly owned subsidiaries for the Nomination and Remuneration Committeeûs approval.

The Group Business Committeeûs meetings are called as necessary. In 2006, there were 7 meetings.

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EGCO Management Committee: The President has set up EGCO Management Committee which currently comprises the following members.

Title 1 President 2 Senior Executive Vice President-Finance 3 Senior Executive Vice President-Asset Management and Planning 4 Senior Executive Vice President and Managing Director of REGCO 5 Senior Executive Vice President and Managing Director of KEGCO 6 Executive Vice President and Managing Director of ESCO 7 Executive Vice President-Controller (EVP-Controller) 8 Executive Vice President-Corporate Service (EVP-CS) 9 Executive Vice President-Asset Management and Planning (EVP-AMP) 10 Senior Vice President-Corporate Secretary

Position Chairman Member Member Member Member Member Member Member Member Secretary

EGCO Management Committee is responsible for formulating business policy of the Group, scrutinizing all proposals to be presented to the Board and standing committees and monitoring the operation of the Group.

The meeting of EGCO Management Committee is called on a weekly basis. In 2006, the committee held 34 meetings.

Good Governance Committee: The President sets up the Good Governance Committee which currently comprises the following members.

Title 1 2 3 3 4 5 7 8 9 8 9 10

President Senior Executive Vice President-Finance Senior Executive Vice President-Business Development Senior Executive Vice President-Asset Management and Planning Senior Executive Vice President and Managing Director of REGCO Senior Executive Vice President and Managing Director of KEGCO Executive Vice President-Corporate Service Senior Vice President-Legal Senior Vice President-Corporate Communications Senior Vice President-Human Resources Senior-Vice President-Corporate Secretary Senior-Vice President-Internal Audit

Position Chairman Member Member Member Member Member Member Member Member Member Member and Secretary Member and Secretary

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The Good Corporate Committee is in charge of the following responsibilities.

1. To consider international criteria and practices of Good Corporate Governance and those of the SET and SEC, 2. To formulate the policy, guidelines and practices of the Group in compliance with the Good Corporate Governance, and 3. To revise the Code of Conduct to suit the business environment and convey it to all employees as well as providing cooperation to promote the practice in the Group.

The Good Corporate Governance Committee meets when necessary. In 2006, there was only one meeting.

Risk Management Committee: The President establishes the Risk Management Committee which comprises the following members.

Title 1 2 3 3 4 5 7 8 9

President Senior Executive Vice President-Finance Senior Executive Vice President-Business Development Senior Executive Vice President-Asset Management and Planning Senior Executive Vice President and Managing Director of REGCO Senior Executive Vice President and Managing Director of KEGCO Executive Vice President and Managing Director of ESCO Executive Vice President - Controller Executive Vice President - Corporate Secretary

Position Chairman Member Member Member Member Member Member Member Member

The Risk Management Committee meets when necessary and directly reports to the Audit Committee, with the following responsibilities.

1. To determine the risk management criteria for the Company and subsidiaries, 2. To determine the risk management evaluation and mitigation, 3. To monitor compliance with risk management framework 4. To revise the Company没s risk factors to comply with the regulations of Good Governance authorities, and 5. To report its performance to the Audit Committee and the Board of Directors.

In 2006, the Risk Management Committee held four meetings.

4. Director and Management Selection To ensure the appropriateness of director and management selection for efficient governance, the Company sets up the following framework.

Director Selection and Appointment The Company endeavors to select capable directors to oversee the Company, designate the corporate policies and sanction its business plans for the benefit of the Company and shareholders. With respect to this, the Company puts an 50

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emphasis on the director nomination and selection process taking into account the following qualifications and experiences in considering each individual candidates.

1. Regulations and Notifications of SET and SEC regarding the directorsû qualifications, 2. Directorsû qualifications prescribed in Directorsû Code of Conduct namely honesty, virtue, initiative and achievement, excellence, accountability, justice, independence, equality of shareholder opportunity, 3. Knowledge and experiences beneficial to the Companyûs business, 4. Trainings and experience at the policy making level in corporate governance, 5. Willingness to represent the best interests of all shareholders, 6. Willingness to devote time and effort to contribute to the Companyûs development.

The Board has delegated to the Nomination and Remuneration Committee the duty of selecting and recommending prospective nominees, whether they are to become the shareholdersû representatives or independent directors, to the Board for approval. The Nomination and Remuneration Committee is also responsible for assessing the appropriate mix of skills and characteristics required of Board members in the context of the needs of the Board at a given point in time and shall periodically review and update the criteria as deemed necessary. The nomination of directors to succeed those who retire by rotation must be individually approved at the shareholdersû meeting based on the voting guidelines in the Articles of Association as follows.

1. Each shareholder shall be entitled to the number of votes equivalent to the number of shares held by him/her; one share shall have one vote.

2. Each shareholder shall elect one or more directors, provided that they shall not exercise their votes in excess of the number of directors required at such time.

3. In a case that a shareholder elects more than one director, s/he may exercise all the votes s/he has, provided that s/he may not split his votes among 51

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any such persons.

4. The persons receiving the highest number of votes in respective order shall be appointed directors depending on the requirements of directors set at such time. In the event that a number of persons receive an equal number of votes for the last directorship, the Chairman of the meeting shall have a casting vote.

5. Directors must be appointed by the vote not less than four-fifth of the shareholders present and having the right to vote.

To ensure that shareholders have adequate information to make their selection, the Company shall present details of a given nominee such as education background, occupation, directorship in other companies, relevant experiences, and illegal acts committed (if any) in the notice of shareholdersû meeting. In case of the re-election, the attendance records and performance during the past year shall also be presented.

In the case of casual vacancies, the Nomination and Remuneration Committee will nominate a qualified candidate who does not possess any forbidden characteristics as stipulated under the Public Company Act for approval at the subsequent Board of Directorsû meeting.

The director who fills in the vacancy shall retain the office for only the remaining term of office of the director whom s/he replaces. The resolution of the Board of Directors in this respect shall consist of not less than three-fourth the votes of the remaining directors.

All new directors must participate in the Companyûs orientation program. This orientation will include presentations by senior management to familiarize new directors with the Companyûs significant issues, Directorsû Manual and the Companyûs Code of Conduct for Directors and Employees. Any sitting directors and other top management may attend the orientation program.

The Company also offers the minority shareholders to contact the Board by letter or email to recommend candidates for director nominees. Starting from 2007 onward, the Company has set up the guidelines for recommending director nominees including the form for shareholdersû conveniences.

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Management Selection The Board determines policies and principles for selection of the President and the President's succession plan in the event of an emergency or the retirement of the President taking into account educational background, experiences, capabilities, ethics and leadership. The Nomination and Remuneration Committee shall consider and propose the qualified candidates to the Board.

The President is entrusted to select the knowledgeable, competent and experienced executives in accordance with the qualifications and selection process stated in the Companyûs Regulation on Human Resource Management B.E. 2544 (1st amended) and the resolution of the Board as follows.

1. The Nomination and Remuneration Committee shall approve the appointment of Senior Executive Vice President, Executive Vice President, the subsidiariesû Managing Director and Deputy Managing Director.

2. The President shall appoint the division and section managers. The appointment of Secretary to the Board and the Assistant Secretary to the Board shall be approved by the Board of Directors while the appointment of division manager of Internal Audit shall be endorsed by the Audit Committee.

5. Director and Management Remuneration The Company set the directorsû and managementûs remuneration at the appropriate rate which is suitable for their liabilities and comparable to that of the leading companies in the same sector, with the approval of the Nomination and Remuneration Committee.

Director Remuneration The principles for director remuneration are as follows.

1. The remuneration comprises monthly retainer fee, meeting allowance and bonus.

2. Directors who serve as committee members will be entitled to extra remuneration to match the increase in responsibilities.

3. The Management who serve as directors and committee members shall not receive director's from remuneration.

In 2006, the Shareholdersû Meeting resolved that the directorsû remuneration comprised the monthly retainer fee and meeting allowance to reflect the liabilities, time devotion and meeting attendance of each director. On the other hand, the bonus payment was tied with the Companyûs achievement. Details were as follows.

1. Monthly retainer fee at 30,000 baht and meeting allowance at 10,000 baht each. In case of director resignation, retainer fee would be paid to each director/ committee member in proportion of the service time in the month.

Members who did not attend the Meeting would not receive the allowance, which would also affect the bonus remuneration. Chairman of the Board received 25% additional remuneration for both the retainer fee and the meeting allowance.

2. Bonus of 13 million baht would be allocated taking into account the success of governing the operating assets, the progress of new projects and the recognition on good corporate governance. The allocation would be at the discretion of the Board.

In this regard, the directorsû remuneration for 2006 is summarized below.

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No.

Name

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

Mr. Pornchai Rujiprapa Mr. Chaipat Sahasakul Mr. Aswin Kongsiri Mr. Worawit Khamkanist Mr. Chareon Prajumtan Mrs. Wattanee Phanachet Mr. Sanit Rangnoi Mr. Chamnong Wongsawarng Mr. Sombat Sarntijaree Mr. Peter Albert Littlewood Mr. Richard McIndoe Mr. Hideaki Tomiku Mr. Mark Takahashi Mr. Visit Akaravinak

Total Remuneration in 2006 Period Service Meeting (Monthly Retainer, Appoinment Attendance Meeting Allowance) Bonus/2 Date (9 Times/Year) Director Standing /1 2006 2005 Committee November 27, 2006 April 25, 2005 April 24, 2006 April 26, 2004 June 26, 2006 December 1, 2006 November 27, 2006 November 27, 2006 November 27, 2006 April 25, 2005 April 25, 2005 June 26, 2006 October 30, 2006 August 1, 2005

1 12 12 12 6 1 1 1 1 12 12 6 2 12

12 12 12 12 12 5

Total Remuneration

3/3 6/6 9/9 9/9 5/6 1/1 2/3 3/3 3/3 4/9 4/8 5/6 2/4 9/9

80,000 450,000 450,000 450,000 235,000 40,000 54,000 64,000 64,000 370,000 370,000 235,000 82,000 -

100,000 687,500 1,679,200 637,600 295,000 30,000 27,200 154,250 59,250 524,400 80,000 -

818,040 804,400 804,400 191,970 /3 1,356,340 797,590 /3 353,630

180,000 1,955,540 2,933,600 1,892,000 530,000 70,000 81,200 410,220 64,000 1,785,590 1,691,990 235,000 162,000 353,630

1/1 3/3 6/6 2/2 2/2 5/5 5/5 3/3 5/5 3/3

70,000 166,500 398,750 134,000 134,000 326,000 326,000 193,000 316,000 202,000 5,210,250

46,000 736,000 1,526,000 144,000 220,800 322,500 1,224,000 90,400 8,584,100

1,022,540 804,400 818,040 818,040 783,960 204,510 919,080 804,400 818,040 12,119,380

1,138,540 1,706,900 2,742,790 1,096,040 917,960 751,310 1,567,580 193,000 2,344,400 1,110,440 25,913,730

The directors retired by rotation and tendered their resignation during 2006 1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

Total

Mr. Chai-Anan Samudavanija Mr. Sommai Phasee Mr. Norkun Sittipong Mr. Charu-Udom Rangsuwan Mr. John William Hancock Mr. Sahai Rakyao Mr. Kitti Sirikwin Mr. Paiboon Thepmongkol Mr. Michael Irl Nikkel Mr. James Richard Truscot

/1 /2

/3

April 26, 2004 April 25,2005 April 24, 2006 April 30, 2003 June 28, 2004 October 31, 2005 April 26, 2004 April 24, 2006 April 25, 2005 April 25, 2005

2 4 10 4 4 10 10 7 10 6

12 12 12 12 12 12 12 12 12

Standing Committee are 1. Executive Committee 2. Audit Committee 3. Nomination and Remuneration Committee Bonus for Board of Directors in 2005 was paid in May 2006, as resolved by the Shareholders in the Annual General Meeting No.1/2006 on April 24, 2006 Bonus for Board and Group Business Committee was paid in May 2006

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Management Remuneration The Management没s remuneration which comprises both salary and bonus is determined to be linked with the corporate and individual achievement based on the remuneration structure approved by the Board. The Company periodically conducts the survey of the executive remuneration to ensure that the rate is comparable to that of the peer companies.

In this regard, the Management没s remuneration for 2006 was summarized below.

(Unit : Baht) 2006 Total Remuneration Remuneration Executive Director (1 Person) /1 Management (6 Persons) /2 Total Salary 19,327,200.00 19,327,200.00 Bonus /3 8,617,968.47 8,617,968.47 Meeting Allowance 27,945,168.47 Total 27,945,168.47 /1

/2

/3

Executive Director is defined as director who is also management of the Company. In this regard, the President is the executive director.

He is not entitled to the retainer fee or meeting allowance as members of the standing committees.

These included 6 management namely the President, SEVP-AMP, SEVP-BD, SEVP-FIN, two Senior Executive Vice Presidents who are seconded to be the Managing Directors of REGCO and KEGCO. Since the MDs of REGCO and KEGCO are paid by those companies.

EGCO is responsible for the remuneration of only four management.

The 2006 bonus will be paid in January 2007.

Total Remuneration of Core Subsidiaries没 Management The remuneration of the Management in 2006 is detailed below.

(Unit : Baht) Year 2006 REGCO Total Directors Management (10 Persons) (7 Persons) Remuneration 13,129,668.00 13,129,668.00 Salary /1 4,594,291.57 4,594,291.57 Bonus /2 Meeting Allowance 17,723,959.57 17,723,959.57 Total Remuneration

/1 /2 /3

KEGCO Directors (10 Persons) -

Total Management (7 Persons) Remuneration 11,381,030.00 11,381,030.00 4,948,459.00 4,948,459.00 16,329,498.00 16,329,498.00

TLP Cogen Directors (5 Persons) -

Management Total (1 Person) /3 Remuneration 1,197,900.00 1,290,540.00 578,925.95 576,624.22 1,776,825.95 1,867,164.22

The 2006 bonus was paid in January 2007.

EGCO was responsible for the meeting allowance of REGCO and KEGCO Board.

TLP COGEN Management was assigned from EGCO under the Service Agreement between EGCO and TLP COGEN.

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Other Remuneration In 2006, EGCO and its core subsidiaries contributed their parts to the provident fund for their respective Management as follows.

(Unit : Baht) Year 2006 Company Provident fund 774,360.00 1,312,996.80 1,039,226.00 105,494.10

Members 3 7 7 1

EGCO REGCO KEGCO TLP Cogen

6. Employees As of December 31, 2006, EGCO has 114 headcounts which include the President, three Senior Executive Vice Presidents, and nine executives who are seconded to be management of Group companies. The rest of 101 headcounts are attached to the following functions:

1.

2.

3.

4.

5.

6.

7.

Key Areas

Members (Persons)

President Business Development Asset Management and Planning Finance Controller General Counselor & Corporate Secretary Corporate Services

11 13 17 20 5 8 27

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Core Subsidiaries The Company没s headcounts is structured as follow: Total (Persons) Employee REGCO 67 48 31

1. Operation 2. Maintenance 3. Others

KEGCO 71 57 31

There are three permanent staff members who serve TLP Cogen including the general manager who is assigned from EGCO under the service agreement between EGCO and TLP Cogen. The Operation and Maintenance staff members of 31 headcounts are ESCO employees who work under the O&M service agreement between ESCO and TLP Cogen.

The Company has the policy that the employees in the Group have fair remuneration which can be comparable to the peer companies. Remuneration of employees of the Company and core subsidiaries in 2006 is as shown below: (Unit : Mil ion Baht) EGCO/1

REGCO

Amount KEGCO

173.37 43.13 8.61 225.11

86.74 29.70 8.58 125.02

110.43 44.11 10.37 164.91

Remuneration Total Salary Bonus/ 3 Provident Fund Total /1 /2

/3

TLP Cogen/2 2.99 1.03 0.13 4.15

Include salary and bonus of the executive on one year contract Include the salary and bonus of the management of TLP COGEN who is assigned by EGCO to be the General Manager and the salaries of three permanent employees.

The 2006 bonus was paid in January 2007.

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7. Human Resource Development Policy EGCO Group believes in the value of our human resources and will strive to be the employer of choice by promoting the participative management with equal opportunity for career advancement. Employees are encouraged to enter the development program to enhance their capabilities to bring out their highest working potentials to undertake tasks in competent manner and maintain our leadership in the business.

To ensure the consistent human resource development, the responsible unit prepares the human resource development plan to ensure clarity as well as efficient implementation. Employees are encouraged to attend both technical and managerial skills in order to compete with international competitors. The human resource development policies of the Group are as follow: Promote employees没 development in all areas including behaviors, knowledge, technical skil s and expertise, and management in order to gain opportunities for accepting higher responsibilities.

Promote employees没 development by continuously developing 莽On the Job Training Program茅, attending seminar, and participating in professional training, and etc.

EGCO also set the key competencies for each position.

8. Other information related to the Board of Directors and Management In 2006, no directors and management were recorded to be prosecuted by the following cases.

Criminal prosecution, except the violation of traffic rules, minor offence or in respect of the same offence Bankruptcy or receivership

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Corporate Governance Report

The Electricity Generating PCL intends to apply the Good Corporate Governance Principle issued by the Stock Exchange of Thailand (çSETé) and the Best Practices for Directors of Listed Company issued by the Securities and Exchange Commission (çSECé) as our guiding principles to ensure efficient management and sustainable business growth. The essential of the Companyûs corporate governance practices are as briefed below:

1. Corporate Governance Policy The Board of Directors is committed to growing its business taking into account the vision, mission, Code of Conduct, stakeholders as well as acceptable risks. In this regard, the Board of Directors shall oversee that the organization structure has a check and balance mechanism and minimize the conflict of interests between the employees and major shareholders and protect against the misuse of the Companyûs assets.

The Company operates the business with regard to the good corporate governance policies as follows.

- Be responsible for shareholders and other stakeholders by protecting the Company assets as well as our good reputation; - Establish clear responsibilities in accordance with the entrusted mission with disciplines and awareness of existing and future risks; - Have clear and transparent decision making process and working procedures; - Treat stakeholders equitably and avoid bias or situation that may raise any conflicts of interest; - Foster the Companyûs sustainable growth and long term shareholdersû value; - Continuously enhance competitiveness; and - Be sensitive to community and environment concerns.

The Company has broadcasted the written corporate governance policy comprising the policies on fair disclosure, internal control, risk management, and Code of Conduct 59

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together with the structure of the Board and the standing committees on the Companyûs website. During the past year, the Company has strictly adhered to the corporate governance policy and there was no event that was considered a breach to such policy.

2. Shareholders: Rights and Equitable Treatment The Company respects the shareholdersû rights and defines the guidelines to preserve the rights and equitable treatment of shareholders as follows.

- Arrange a shareholdersû meeting in a way that allows equitable treatment of all shareholders and adhere to the principle that one share can be counted as one vote, - Provide the channel for the shareholders to direct critical corporate issues to the Board of Directors by mail or electronic mail through the Companyûs website, - Observe the shareholdersû rights to have adequate, necessary and accurate information to evaluate the Company by disclosing the current situation and future trends including other information as required by the SET and the SEC on an equitable, regular and accurate basis, - Ensure that shareholders can get their actual return on investment by having the simple structure between the Company and its subsidiary and associate companies with no cross shareholding, and - Establish internal regulations in the Code of Conduct for directors and employees to prevent the insider trading and conflict of interest.

3. Relations with Investors Being aware of the impact of the Companyûs information on the decision of investors and stakeholders, the Board set a policy to disclose both financial and non-financial information in a materially sufficient, adequate, reliable and timely basis in both Thai and English versions. The Company fosters trust by making prompt disclosure via the SETûs Community Portal system and the Companyûs website. Such information is also sent by electronic mail to investors and analysts subscribing to the mailing list.

Only the President or the assigned staff member is authorized to disclose the Companyûs information. The Company set up the Investor Relations Section to be responsible for communicating with institutional and individual investors, analysts and concerned government agencies on an equitable basis. Investors and shareholders can contact the Investor Relations Section at telephone number 0-2998-5131-3 or by e-mail to ir@egco.com.

For 2006, corporate information was disclosed via various channels as follows: Disclosure to the SET and the SEC, Quarterly Management Discussion and Analysis, Investor relations activities which included local roadshows, shareholdersû visit, seminars on the Companyûs business, analyst meetings, EGCO news letter and mailing list.

Media communications comprising 2 press conferences on business directions, 4 media trips, 12 executive interviews and 25 press releases and photo captions.

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4. Roles of Stakeholders The Board of Directors respects the rights of various stakeholders and encourages active cooperation between the Company and stakeholders in creating wealth and the sustainability of financially sound enterprises.

A. Rights of Various Stakeholders The Board of Directors has set the guidelines in the Code of Conduct for the directors, management and employees to observe the rights of various groups of stakeholders.

Shareholders: The Company respects the fundamental right of the shareholders to obtain adequate and timely information and wil not act in a way that will violate the shareholders没 right. Moreover, the Company encourages the shareholders to attend and to vote in the shareholders没 meeting.

The Company will strive to achieve growth based on its potential and core competencies so that shareholders, over the long term, will benefit from the productive performance and good operating results of the Company.

In absence of unforeseen circumstances, the Company intends to distribute dividend at approximately 40% of the net profits after tax. This dividend policy may change in the light of investment opportunities that may become available to the Company, or as a result of other economic or financial factors, or when a dividend payment may have a significant impact on the normal operation of the Company.

Employees: The Company believes in the value of its human resources and will strive to be the employee of choice. This is achieved by promoting the participative management, supporting the employees没 professional development and providing fair remuneration and suitable benefit scheme.

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1. The Company provides full and continuous support to the professional development programs for each employeeûs level to enhance both key and functional competencies and bring out their highest working potentials to undertake tasks in competent manner and maintain the business leadership. Apart from skil s and competencies enhancement, the Company also supports programs that promote spiritual strength and good relationship among the employees.

2. The Company promotes the participative working environment. In a bid to promote two-way communication, Communication Day is set to broadcast significant information to the employees and to be attentive to their feedbacks. Employees are encouraged to express their opinions and complaints via various channels such as suggestion boxes, the Welfare Committee, or the Good Corporate Governance Committee. All the suggestions and complaints will be well taken care of with an aim to benefit all concerned parties and to enhance a good working relationship.

3. The Company will strive to promote pride among the employees with career advancement and fair remuneration.

4. The Company has established a policy on health, safety and environment which is widely implemented among the Group companies. The Occupational Health and Environment Committee takes care of the implementation.

Monitoring and follow-up programs are set up to ensure that the working environment is safe and healthy and that the employees have accessed to safety equipment and know how to use them.

5. To ensure that the employees have a sound mind and a sound body, the Welfare Committee recommends and monitors employeesû benefit and welfare programs. Annual physical check up, sport facilities, life and health insurance for all employees are provided on the Companyûs expenses. Some of the benefit schemes are extended to cover the employeesû families.

It should be noted that during the past year, there was no legal dispute between the employees and the Company.

In addition, there was no disabling injury in all Group companies. We are proud to announce that the Rayong Electricity Generating Co., Ltd. (çREGCOé) and the Khanom Electricity Generating Co., Ltd. (çKEGCOé) were certified the OHSAS 18001:1999 (Occupational Health and Safety Assessment Series) by RWTUV (Thailand) and KEGCO has been honored as the National Distinguished Workplace in terms of Safety, Occupational Health and Environment for 7 years consecutively.

Customers: The Company always commits to provide good quality and reliable services in accordance with the agreements with EGAT and all customers. To ensure the consistent quality service, the ISO 9001:2000 has been implemented at REGCO, KEGCO, Roi-Et Green Co., Ltd. and Egcom Tara Co., Ltd. During the past year, the Company and its subsidiaries can generate the contracted electricity with higher equivalent availability factors (çEAFé) than the value stipulated in the power purchase agreement. REGCO was awarded the EAF bonus for 10 years consecutively.

Suppliers and Contractors: The Company requires that all aspects of procurement of goods and services be conducted in compliance with ethical standards. In addition, the Company aims at developing and securing sustainable relationship with suppliers and contractors on the bases of value for money, technical conformance and mutual trust. As such, the following guidelines, which are prescribed in the Regulation on Procurement and Supply and the Code of Conduct, are fully observed.

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Competitive tendering with equal information Objective evaluation of tenders and selection of suppliers and contractors Appropriate forms of contract Effective monitoring systems and management controls to ensure the proper fulfillment of contractual obligations, and to detect and prevent bribery, fraud or other malpractice throughout all stages of the procurement process Prompt payment consistent with the mutually agreed terms of trade For 2006, there was no complaint from suppliers and contractors.

B. Involvement in Good Corporate Governance System The Company provides mechanism to involve stakeholders in raising the company performance. Apart from providing stakeholders with relevant, sufficient and reliable information, the Company also encourages them to communicate their recommendations and concerns to the Company via the suggestion box, Investor Relations Section or the Company没s website.

Starting from March 5, 2006, the Company provides the following channel for the stakeholders to direct corporate issues to the Board of Directors.

Electronic Mail Mail

directors@egco.com Board of Directors Electricity Generating Public Company Limited EGCO Tower, 222 Moo 5, Vibhavadi Rangsit Road, Tungsonghong, Laksi, Bangkok 10210

The Corporate Secretary will be responsible for forwarding those communications to relating directors or the standing committee. Company没s accounting and financial statements, internal control, risk management and compliance will be forwarded to the Audit Committee. The Corporate Secretary will summarize all directors没 communications received during the most recent quarter to the Board.

For 2006, the Shareholders sent the e-mail to the directors to ask about the acquisition of the shares in the BLCP Power Company, which was clarified by the Board of Directors in the Shareholders没 Extraordinary General Meeting to approve this transaction.

C. Corporate Social Responsibility The Company takes into account the community and environmental concerns and will conduct its business under the laws, relevant regulations including regulations of the local administrative organization. The significant activities are as follows.

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- Alleviating the adverse effects on the environment and undertaking appropriate reviews and evaluations of our performance to measure and ensure compliance with our environmental policy; - Encouraging employees to have strong concern and being responsible for clean environment; and - Communicating with the public on environmental matters and sharing our experience with other agencies for environment conservation and social support such as providing donation and support to the Children and Family Library Project of the Tai Wisdom Association as well as other community religious and cultural activities.

5. Shareholdersû Meeting The Company follows the best practices recommended by the SET for organizing the general shareholdersû meeting by: - Encouraging all directors, board committees, management and the Companyûs external auditor to attend the shareholdersû meeting, - Delivering the notices of the meetings as well as the agenda document to the shareholders which includes objective and rationale for each agenda, board of directorsû opinions, conditions and procedures to attend the meeting prior to the meeting date for their thorough consideration. The notice of the meeting including relevant information is posted on the Companyûs website before sending the notice of the meeting to the shareholders for their thorough consideration prior to receiving the hard copies. There is no ad-hoc agenda in the shareholdersû meeting, - Enabling shareholder who cannot attend the meeting to vote on the Company issue via proxy and also offering the independent directors as their proxy,

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- Allowing shareholders to exercise their votes to elect directors on an individual basis which they can elect the qualified candidates from diverse related fields to represent them in the Board of Director to protect their benefits, - Providing shareholders with convenience and adequate time to express their opinions for each agenda and ask questions at the shareholdersû meeting. Besides, the Chairman of the meeting pays attention to clarify all shareholdersû inquiries which wil be recorded. The shareholders could exercise their rights for each agenda.

- Disclosing the minutes of meeting for shareholdersû review via the SET and the Companyûs website within 14 days after the meeting.

For 2006, the Company organized two shareholdersû meetings: the Annual Shareholdersû General Meeting on April 24, 2006 to consider and vote on various matters as required by relevant laws and regulations and the Extraordinary Meeting on December 1, 2006 to seek shareholdersû approval for connected transaction for the acquisition of shares in BLCP Power Company limited and the election of an independent director. The Company sent out the meeting notices 19 days and 20 days in advance of the meeting, respectively with disclosure on the Companyûs website prior to the mailing of the hard copies.

The Company facilitated shareholders who wanted to attend the meeting by providing the shuttle service between the meeting place and the subway, suitably and adequately designating registration locations with light refreshments. Moreover, the Company provided information about the Companyûs activities via mini-exhibition in front of the meeting hall. For 2007, the Company plans to apply a barcode system to facilitate the shareholdersû registration process and also invited the minority shareholders to propose the meeting agenda and recommend candidates for director nominees within the timeframe prescribed by the Company.

During the shareholdersû annual general meeting and the shareholdersû extraordinary meeting in 2006, the Chairman of the Board served as the meeting chairman. The President, Chairman of Boardûs standing committees, directors and external auditor all attended the meeting. In this regard, the Company invited the representatives from PricewaterhouseCoopers ABAS Limited to witness the voting result of each agenda to ensure transparency. Shareholders were encouraged to send their inquiries in advance to the Investor Relations Section or to the Board of Directors.

The Company has conducted the survey on the quality of the shareholdersû meeting since 2004. Feedbacks were used for further improvement to ensure transparency, efficiency and benefits to the shareholders and the Company. In 2006, the result of the shareholder meeting survey indicated that the shareholders were satisfied with the information in the notices of the meeting, the meeting arrangement, registration, and meeting conduct.

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6. Leadership and Vision The Board of Directors consists of knowledgeable, capable, and experienced professionals from diverse related fields, thereby enabling the Company to perform efficiently. The Boardûs efficiency was evidenced as it won the Board of the Year for Distinctive Practice for 2005/2006 organized by the Subcommittee to promote the Corporate Governance in Thailand, Thai Institute of Directors Association (çIODé), and the SET. With integrity and business ethic, the Board exercises its power in compliance with laws, regulations, and resolutions of shareholdersû meetings and Directorsû code of conduct.

In 2006, the Board planned and endorsed the following activities to improve the efficiency and effectiveness of the governance system.

- Arranged Directorsû orientation and update Directorsû manual to equip incoming directors with knowledge about the Company, governing laws and regulations as well as having a chance to meet with the Management. Directors were also encouraged to attend the courses at the IOD; - Appraised the performance of the Board of which the result indicated that most directors were satisfied with the current practices on Meeting, Communications, Procedure and Relationship with the Management; - Appraised the performance of the Audit Committee which showed that the Committeeûs component, qualifications, and performance were in compliance with the SETûs and international good practice; - Set the authority between shareholders, Board, Boardûs standing committees and Management to ensure efficiency, transparency and clear responsibility. This was based on the principle that the Board was accountable for setting business direction, policy and strategies while the Management was accountable for normal operation; - Set the guidelines to assess the corporate success by adopting the balanced scorecard concept of which the result is monitored on a quarterly basis; and - Support the executive development program to enhance their capacities and skills to be suitable to perform their duties and to assign the suitable and challenging job.

All directors are competent with the knowledge about the business and the duties of directors. List of directors who attended the courses at IOD and outside organizations is as follows:

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Names

1. Mr. Pornchai Rujiprapa Chairman 2. Mr. Chaipat Sahasakul Independent Director 3. Mr. Aswin Kongsiri Independent Director 4. Mr. Worawit Khamkanist Independent Director 5. Mrs. Wattanee Phanachet Independent Director 6. Mr. Chareon Prajumtan Independent Director 7. Mr. Sanit Rangnoi Director 8. Mr. Chamnong Wongsawang Director 9. Mr. Sombat Sarntijaree Director 10. Mr. Visit Akaravinak Director and President

Course Director Audit Chairman 2000 Directorsû Certification Accreditation Committee Program Program Program

Finance for Raising the non-finance Awareness of director Corporate Fraud in Thailand

√ √ √

√

√

√ √

√ √

√

√ √ √ √

√

√

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7. Conflicts of Interest The Company has set the following measures to prevent directors and management from inside trading and the misuse of the Companyรปs information for their own or other benefits.

- Directors and Employees must at all time observe the rules and regulations issued by the SET, the SEC, and other governing laws which include the equitable disclosure to shareholders and the public.

- Directors and Employees will not use inside information wrongly or in a way that will damage the Company.

- Any information disclosure to the public that would affect the business and the companyรปs stock must be approved by the President. Only the President or the assigned staff member is authorized to disclose such information.

- Directors and employees must not buy or sell shares while in possession of information, which, if disclosed publicly, would be likely materially to affect the price of the companyรปs shares.

The Company has set the policy in the Code of Conduct for Directors and Employees to avoid the conflicts between the personal interest and the corporate interest as follows.

- Directors and employees shall not be engaged as directors or advisors of other companies, organizations, and associations that may conflict with the interest and the business of the company. Acknowledgment by the Board of Directors must be sought before taking such engagement.

- Directors will promptly notify the Board when any of the conflict of interest occurs and must consider whether to refrain from participating in the debate and/or voting on the matter, whether to be absent from discussion of the matter, whether to arrange that the relevant board papers are not sent, or, in an extreme case, whether to resign from the Board.

- The list of major shareholders is disclosed. Directors and designated Management will report the change in their security holdings to the regulatory body. The Corporate Secretary is assigned to report the security holdings of directors and management to the Board at every meeting.

- Employees should not borrow money from the Companyรปs customers/suppliers or from individuals or firms having business dealings other than financial institutions as it may influence the way they handle company business.

- Transaction that may induce the conflict of interest shall be reported to the Board of Directors for consideration. The details of such transaction such as transaction price, contractors, and rationale are to be disclosed in compliance with the requirements of the SEC and SET. The Corporate Secretary Division will review the type of transaction and the approval authority and will submit the reports on connected transactions and any conflict of interests to the Audit Committee for acknowledgement on every half-year. This report is carefully prepared and in compliance with the regulations of the SET which specifies that these issues must be reported and disclosed quarterly as well as in the annual report and annual registration form (Form 56-1).

It should be noted that during the past year, there was no case of insider trading or any wrongdoing with regard to connected transactions. This proves the Boardรปs efficiency in this area.

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8. Code of Conduct To maintain high ethical standards, the Company has set up a Code of Conduct as a guideline so that the Company没 directors, Management team and employees perform their duties with regard to ethical values. The Code of Conduct covers guiding principles, making the system work, compliance with laws and regulations, business ethics, human resources, safety, health and environment and accountability. The Company continuously provides the training program to the employees as well as clarification on frequently asked questions. Directors, management and employees must obey and respect the spirit of the Code of Conduct. Managers at all levels are required to promote the compliance with the Code of Conduct and act as role models.

9. Balance of Power by Non-Executive Directors Currently, the Board comprises 14 directors which the Board viewed that it is a suitable number to oversee the business. With the President as the only executive director, the other 13 are outside directors which accounts for 93% of the Board members. From these outside directors, 5 are qualified as the independent directors which accounts for 36% of the total directors. This ensures that the balance of power is appropriate and the directors can independently represent the best interests of shareholders.

The Board has the significant responsibility to conduct the business upon the interest of the Company, shareholders and stakeholders including employees and the community where the Company runs its business. The Board sets the vision, policy including the budget for the Company没s business together with the Management in order that the business plan will be mutually agreed. The Board provides the recommendation on the significant procedure while monitoring the implementation of the Company没s business

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plan and changing it as deemed necessary. The Board will delegate the authorization to the Management for conducting the business in line with the corporate targets.

Moreover, the Company defined the qualifications of independent directors to be above the minimum requirements set by SET by setting the maximum shareholding by each independent director in the Company at not exceeding 2%.

Independent directors agreed to hold executive sessions twice a year to discuss significant issues of the company without the attendant of the Management. Details of the discussions were reported to the Board and the Management for acknowledgement.

10. Aggregation or Segregation of Duties To ensure clear duties and responsibilities, the Company has set the policy that the Chairman is a non-executive director, is not the same person as the President and has no relations with the Management. His authorities are separate from those of the president, and there is a clear distinction between supervisory policy-making and day-to-day business administrative roles. The Chairman takes the role of the leader and assures that the Boardûs meetings are conducted efficiently by encouraging involvement by all directors and providing recommendations to Management via the President.

The Board wil not intervene with any routine activities under the Presidentûs responsibilities.

11. Remuneration for Directors The Company set the directorsû remuneration at the appropriate rate which is comparable to that of the leading companies in the same sector. The Nomination and Remuneration Committee shall propose the directorsû remuneration for endorsement by the Board and approval by the Shareholdersû meeting. The Company has a policy to disclose the remuneration of each director for transparency. Directors that also serve as committee members will be entitled to extra remuneration to match the increase in responsibilities.

The non-executive directors appraise the Presidentûs performance annually in accordance with the established corporate goal including the person competencies and the remuneration of peer companies. The Chairman of the Board wil communicate the result to the President.

The President will consider the remuneration of top executives and will propose to the Nomination and Remuneration Committee for approval. Remuneration is determined to be linked with the corporate and individual achievement. The Company periodically conducts the survey of the executive remuneration to ensure that the rate is comparable to that of the peer companies and adequate to attract and motivate the qualified executives.

The remuneration of directors and management is disclosed under the topic of shareholding and management structure in this annual report.

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12. Board Meeting To ensure that the Board takes full responsibility to meet the expectation of the shareholders, the Board establishes significant business policy and corporate calendar. In this regard, it is determined that the Board meeting wil be held at least once every two months. Extra Meeting can be called if there is any major unplanned event that needs the Boardûs consideration. The Board can also authorize the Committees to scrutinize or approve the managementûs activities within the delegated authority during the meeting interval. The Board also instructed the management to provide monthly performance report.

To facilitate the directors, the Company plans the meeting dates and the agenda for the whole year in advance.

The Chairman and President fixes the agenda for the Boardûs meeting. Each director can propose the agenda to the Chairman and can deliver their independent judgment. The Corporate Secretary delivers the notice, agenda, and meeting document to the directors for consideration well in advance. Agenda is prioritized in terms of significance i.e., Matter Arising, Matter for Consideration, Matter for Information to ensure that items that need the most careful deliberation are given adequate time.

The Chairman allocates adequate time for the management to present their issues and to permit directors to conduct extensive discussion of agenda items and other topics of interest. The minutes of meeting are draft for the Boardûs review within 14 days after the meeting prior to the adoption at the next meeting. The Board of Directors had called 9 meetings in 2006 comprising 7 scheduled and 2 extra meeting. Each meeting took approximately 2 hours and a half. The average attendance rate is 87%. The electronic file is also implemented for convenient retrieving and cost saving.

The Board encourages the President to invite the top managements to attend the Boardûs meeting to provide additional insights into the items being discussed because of personal involvement in these areas. Managers with future potential are given exposure to the Board to support the consideration of the succession planning. The Board can request additional necessary information from the President or the Corporate Secretary or other assigned management within the extent of the established policy. The Board can also engaged independent advisor for the benefit of the business on the Companyûs expenses.

List of directors and attendance record in 2006 is as listed below.

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Meeting (time)

Name

No.

Appointment Date

Group Executive Nomination Board Audit Meeting Committee Committee Remuneration Business 9 times/year 20 times/year 18 times/year Committee Committee 11 times/year 7 times/year 2/2

1 Mr. Pornchai Rujiprapa November Chairman 27, 2006 1 2 Mr. Chai-Anan Samudavanija April 26, 2004 Chairman 2 April 3 Mr. Sommai Phasee 25, 2005 Independent Director

3/3

3/3

5/6

3/3

4 Mr. Norkun Sitthipong3 Director 5 Mr. Chaipat Sahasakul Independent Director 6 Mr. Aswin Kongsiri Independent Director 7 Mr. Worawit Khamkanist Independent Director 8 Mr. Charu-udom Ruangsuwan4 Independent Director 9 Mr. John William Hancock5 Independent Director 10 Mr. Chareon Prajumtan Independent Director 11 Mrs. Wattanee Phanachet Independent Director 12 Mr. Sahai Rakyao6 Director

6/6

15/16

1/1

12/12

6/6

April 24, 2006 April 25, 2005 April 24, 2006 April 24, 2004 April 30, 2003 June 28, 2004 June 26, 2006 December 1, 2006 October 31, 2005

1/1

1/1

9/9

20/20

9/9 9/9

19/19

2/2

3/3

1/1

2/2 5/6

12/12

1/1

1/1

5/5

8/8

1

Vacating the office by resignation on February 17, 2006 Vacating the office by resignation on May 1, 2006 3 Vacating the office by resignation on October 31, 2006 4 Vacating the office by rotation in the 2006 AGM on April 24, 2006.

5 Vacating the office by rotation in the 2006 AGM on April 24, 2006.

6 Vacating the office by resignation on October 7, 2006 2

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Meeting (time)

Name

No.

13 Mr. Kitti Sirikwin7 Director 14 Mr. Paiboon Thepmongkol8 Director 15 Mr. Sanit Rangnoi Director 16 Mr. Chamnong Wongsawang Director 17 Mr. Sombat Sarntijaree Director 18 Mr. Peter Albert Littlewood Director 19 Mr. Richard McIndoe Director 20 Mr. Michael Irl Nikkel9 Director 21 Mr. James Richarde Truscott10 Director 22 Mr. Hideaki Tomiko Director 23 Mr. Mark Takahashi Director 24 Mr. Visit Akaravinak Director and President 7

Appointment Date

Executive Nomination Group Board Audit Meeting Committee Committee Remuneration Business 9 times/year 20 times/year 18 times/year Committee Committee 11 times/year 7 times/year

April 26, 2004 April 24, 2006 November 27, 2006 November 27, 2006 November 27, 2006 April 25, 2005 April 25, 2005 April 25, 2005 April 25, 2004 June 26, 2006 October 30, 2006 August 1, 2005

Vacating the office by resignation on October 7, 2006 Vacating the office by resignation on October 7, 2006 9 Vacating the office by resignation on October 27, 2006 10 Vacating the office by resignation on June 23, 2006 8

7/7

5/5 3/3 2/3 3/3

2/2

3/3 4/9 4/9

6/6

5/5

12/13

10/11

3/3 5/6 2/4

2/2

9/9

18/18

Note

7/7

The Audit Committee members are numbers 5,7,8,10,11 The Executive Committee members are numbers 1,3,4,6,19,20,23 The Nomination and Remuneration Committee members are numbers 2,3,4,6,7,12,19 The Group Business Committee member are numbers 13,24

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13. Board Committees The Board of Directors appoints the directors with knowledge and expertise to be the members of the Board committees, namely Audit Committee, Executive Committee and Nomination and Remuneration Committee, to ensure thorough consideration and appropriate review of information and to enhance the governance efficiency. The Committees没 charters including the meeting attendance is disclosed under the topic of Shareholding and Management structure in this annual report.

14. Controlling System and Internal Audit The Board of Directors is responsible for ascertaining that internal control systems of the Company and its subsidiaries including financial control, operating control, and compliance control are in place and in accordance with those established pursuant to the SET guidelines and COSO没s Internal Control Framework (The Committee of Sponsoring Organizations of the Treadway Commission). In respect of this duty, the Board has entrusted the Audit Committee with the responsibility to review the effectiveness and efficiency of the internal control systems and internal audit. The internal audit division discharges its duties and functionally reports to the Audit Committee.

The internal control system and the control operations of the Company are as follows: Control Environment The Board sets the Company没s vision, mission, and objectives. Organization structure has also been properly set and adjusted to suit the changed environment. Short and long term business goals as well as Key Performance Indicators are identified and clearly communicated throughout the Company to help ensure that operations are carried out in a manner consistent with the Company没s vision, mission and objectives. Written policy, procedures, and approval authority including authorization of each level of management are used as management tools as is a written Code of Conduct for directors and employees, and compliance with Code of Conduct is reviewed on a timely basis.

Risk Management The Risk Management Committee comprising executive management of the Company and subsidiaries was established in order that risks would be managed at the Group level using the same guidelines. Risk management activities have been performed at the Group, company, and division levels. The process has been designed to identify risks that may prevent the Company from achieving its objectives. The root causes of risks and their impact upon the Company has been thoroughly analyzed in order that mitigated and preventive measures can be developed and implemented. Risk owners are assigned to each key risk area and an early warning system is also provided to ensure timely corrective actions to risk events. The Company has a Risk Management Section which is responsible for following up the risk management activities, reviewing performance in this regard, and regularly reporting results to the Risk Management Committee. Moreover, the Board has entrusted the Audit Committee to review the risk management policy and oversee the compliance with the regulated policy.

Risk management reports are required to be presented to the Board.

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Control Activities To ensure that the policy and the procedures estabished by the Board and the Management are carried out, the Management provided the control system for accounting and finance, operation and compliance. Regulations and internal rules together with clear job describtion are issued accordingly with the level of authority set forth in the Table of Authority. The process to enter into the investment and financial transaction and established and must be followed before seeking approval from the authorized person.

Measures to prevent conflict of interest and penalties in case of violation and defined in the Code of Conduct and other relating regulations. The Management has set up a monitoring unit to follow up and report the operation of the Company and its subsidiaries to ensure the Group's operation are in line with the Company's objectives.

The Corporate Secretary Division has been assigned to oversee the Company没s and the Board没s operation and activities and to ensure their compliance with the requirements of the SET and Securities and Exchange Commission, Thailand (莽SEC茅) and related laws and regulations. A listing of rules and regulations associated with EGCO and subsidiaries are maintained and periodically updated by the Legal Division for reference. In addition, a compliance working team comprised of all division managers has been set up to periodically review operational compliance.

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Information and Communication At EGCO, information are maintained and communicated in a form and timeframe that enables the Board's committees and the management to carry out their responsibilities and to make decision. For instance, power plants operation, financial, and accounting data are maintained in the Management Reporting System.

This reporting system is regularly updated and secured against unauthorized use. During meetings, discussions and inquiries are recorded and minutes of meeting are produced. Accounting records and supporting documents are also completed and kept in an orderly manner. There is no deficiency informed by the auditor. The meeting among the Audit Committee, external auditors and related management were held in order to review accounting record as General Accepted Accounting Principles, to consider the Management Letter from external auditor as well as to improve the communication system among the Company, subsidiaries, and abroad associate for more efficiency of performance monitoring. Public and shareholder information is disseminated through several channels.

For example, updated information is posted on the Companyûs website so that shareholders and investors can have access to the Companyûs information on a real time basis. Employees can also communicate with management and suggest ideas for improvement of Company systems and operations.

Monitoring The Planning Division was assigned to follow up whether the Companyûs operation results are in line with the plan and meet the corporate KPIs. Gap analysis is carried out and scheduled reports are submitted to the Management and the Board.

The Internal Audit Division reviews the internal control system to provide management with assurances about the effectiveness of this system. Exceptions found are reported to the Audit Committee and the Board, and followed up through regularly schedule meetings.

Besides the above components and actions, the Company has set up the internal audit division of which the audit scope covers accounting, finance, compliance to relating rules and regulations, information technology, and management audit of the Company and subsidiaries. The Internal Audit Manager reports functionally to the Audit Committee and administratively to the President. Duties and responsibilities of the Internal Audit Division are set by the Board and described in the Internal Audit Charter that was approved by the Audit Committee and signed by the Board of Directors.

The Board has conducted internal control evaluation annually to assure compliance of the operation with the system.

The evaluation form has been designed to evaluate the Companyûs internal control under the 5 components under the SETûs guideline and COSOûs internal control framework. The evaluation results are reported to the external auditor, the Audit Committee and the Board of Directors by the internal audit division. The 2006 evaluation result can be concluded that the internal control of the Company and subsidiaries are sufficient and appropriate.

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To ensure the compliance with internal control, rules and procedures, and the Code of Conduct, employees from Senior Vice Presidents up of the Company and subsidiaries are required to thoroughly review their 2006 work practices before signing and submitting the Code of Conduct Compliance Statement and the General Representation Letter to his/ her supervisor up to the President who subseqiently signed the Representation Letter to to the Chairman of the Board.

In reviewing the financial statements, the Company's external auditor has reviewed the internal control system with regard to the accounting and finance of the Company to determine the auditing approach, auditing duration and scope of work. In 2006, no significant finding regarding the improvement on internal control system was found.

The Board pays attention to the likelihood of irregular items and the management of significant risks. The board also sees to that the early warning system is established. After reviewing the Company's activities, and the result of the internak control system, inculding the appraisal form, the Board meeting on March 20, 2006, attended by all independent directors, agreed with the Audit Committee that reviewed the Company's activities, and the result of the internal control system, including the appraisal form and appraisal in accordance with the Audit Committee that the internal control system of the Company and subsidiaries was sufficient, appropriate and safeguarding of assets. Until now, the Audit Committee and the Board have not received any report about significant deficiency from external auditors and internal audit division.

15. Directors没 reporting The Board concerns that the shareholders and the public pay attention to the quality of the financial report, therefore, it is accountable for ensuring that the preparation of the consolidated financial statements of the Company and the subsidiaries including all financial information are in line with the generally accepted accounting principles in Thailand and that all significant information is adequately disclosed in the notes to the financial statements. With respect to this, the Board of Directors assigned the Audit Committee to be accountable for the quality of the financial reporting and the internal control system. The Audit Committee has the opinion as shown in the annual report that the consolidated financial statements of the Company as at December 31, 2006 are correct, adequate and reliable.

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Relationship with Stakeholders EGCO and Shareholders The Company has a commitment to its shareholders to strive to achieve growth based on its potential and core competencies so that shareholders receive sustainable benefit from its productive performance and good operating results.

Being aware of the impact of the Company没s information disclosure on investors没 valuation of the Company, the Company discloses both financial and non-financial information in a sufficient, adequate, reliable and timely basis as required by the SEC and the SET.

Share Price In 2006, the Company没s average share price was 82.13 baht per share, up by 6.04% from 2005 with the highest close price of 100 baht on December 26, 2006 and the lowest close price of 71 baht on June 15, 2006. The average price/ earning (P/E) ratio was approximately 7.17.

Dividends The Company没s dividend policy is to distribute approximately 40% of the net profit after tax, or to increase the dividend amount in a steady manner, to the shareholders. This dividend policy may change in the light of investment opportunities that may become available to the company or as a result of other economic or financial factors or when a dividend payment may have a significant impact on the normal operation of the company.

The dividend payout of EGCO Baht 3.5

3.25 3.00

3

2.75 2.50

2.5

2.25 2.00

2.00

1.75 1.50

2.00

1.50

2

1.25 1.25

1.5

1.27 1.00

1

2.00 1.25

0.5

1.25

1.50

1.50

1.00

0

Year 1995

1996

1997

1998 1999

Annual Dividend

2000

2001

2002

Interim Dividend

2003

2004

2005

2006

Final Dividend

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Remarks: 1. In 1997, the Company reported net losses on the annual operation following the baht float; as a result, no dividend was paid to shareholders in that year.

2. The Company also set a policy that the subsidiaries in which the Company has significant control pay dividend at 100% of their net income after tax.

The Company aims to pay dividend twice a year. In 2006, the Company paid the final dividend of 2005 at 1.75 baht per share on May 10, and an interim dividend of 2006 at 2.00 baht per share on September 26.

Investor Relations The Company believes in keeping the investment community informed of all major developments in a timely and accurate manner and welcomes the recommendations from the shareholders. Consequently, we arrange various communication channels and investor relations programs for our investment community as follows:

A. Website Recognizing the importance of fair disclosure, the Companyûs website (www.egco.com) can be accessed for recent announcements by the Company including annual financial results, presentations, past and current annual reports to shareholders as well as EGCO news and investor relations activities. Shareholders, investors and stakeholders can contact the Company via its website to recommend the annual general meetingûs agenda and the candidates for director nominees before the Company submitted the meeting notice to the shareholders.

B. Analyst Meetings/EGCO Round Table Discussion Analysts meetings which SET calls çOpportunity Dayé are held shortly after the Company announces half year and final year end results. EGCO round table discussions are also held which the top management always attends to explain our business to our investors. In 2006, the Company invited shareholders and investment communities via SETûs community portal system to attend a special session to clarify questions about the connected transaction on the BLCP project.

C. Plant Visit To enable our investment community to have a better understanding of the Companyûs business, we arrange a plant visit annually. In 2006, we invited retail investors to visit the Roi-Et Green power plant at Roi-Et province and the institutional investors to visit BLCP Power Plant and TLP Cogeneration Power Plant at Rayong province. About 100 shareholders and investors joined the two programs.

D. Roadshows In 2006, our management participated in domestic roadshows organized by the SET such as çThai Investorsû Dayé at the SET, çSET Money Channel Roadshowé in Udonthani province and çMoney Expo in Chiang Mai 2006é organized by the Money and Banking Magazine. Our management also attended international roadshows to meet institutional investors in Malaysia and Singapore.

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E. Press Conferences and Media Relations The Company hosted two press conferences, one to announce the annual operating performance for 2005 and business direction for 2006 and the other to announce the operating result of the first half of 2006. Four media trips were also arranged to witness the progress of Nam Theun 2 hydropower project in Lao PDR, the Thai Forest Conservation Youth Camp no. 19 at Doi Inthanond National park, the inaugural ceremony of Roi-Et Green Power Plant, and the trip to Japan to introduce Mitsubishi Corporation, a new strategic partner, and to visit the Maizuru Coal Fired Plant.

During the past year, the Company had arranged 12 exclusive interviews with the media regarding the power industry trends, the overall picture of Thai power industry, the Companyûs performance and the social and community activities.

There were 24 press and photo releases.

F. Feedback Form Feedback forms sent out with our annual report is our means to obtain shareholdersû views on the report and on additional information that they would like to receive in the following yearûs annual report, together with questions that they would like the President to answer at the Annual General Meeting. The feedback forms were well received by shareholders.

The Company thanks all the shareholders who provided feedbacks via the feedback forms and other various channels for us to improve our corporate performance and add value to the Company and the shareholders.

Human Resource Management The Company believes that our employees are our most important resource. As such, we endeavor to structure the workforce in a manner that balances the business efficiency with employee happiness. As a part of this objective, the Company has a responsibility to provide its staff with a safe, healthy and fulfilling work environment, with fair remuneration and management as well as ample opportunity for professional development so that the employees will look at the Company as the second home.

Training and Development: The Company has allocated the budget to continuously provide comprehensive employee training and development programs to improve the capabilities and knowledge base of our workforce from top to bottom.

The training and development courses are provided in 4 areas namely, management, technical, safety and environment and quality development. The Company also encourages the employees to attend courses/projects that would foster the environment conservation such as the employee camp at Doi Inthanond National Park.

In addition, the Company supports the knowledge sharing program via internal and external professionals. The E-training program is also provided so that the employees can learn and follow up the knowledge in each area to support the continuous learning concept.

Remuneration: The Company structures the employeesû remuneration to be comparable to the peer companies. The Company employs a pay for performance policy which is easily measurable and transparent. We used 360 degree evaluation of each individualûs core and managerial competencies taking the views of supervisors, subordinates and peers of each employee. Furthermore, each employeeûs performance is measured against the committed objectives which he/she

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designates in advance through a key performance indicator (KPI) system. All feedbacks from the performance appraisal process is provided to each employee together with interviews from senior management on areas of strength and improvement.

Quality of Life: The Company endeavors to provide a comfortable working environment with annual physical check up and adequate health insurance for all of its workers. Employees are encouraged to promote healthy living through active participation in sports and exercise at facilities provided by the Company free of charge. In addition, the Company applies to the social Welfare fund and set up the provident fund for all employees.

Safety and Health: The Company seeks to promote a safe and healthy working environment for all employees. We are proud to report that no incident occurred which led to disabling injury in the Group this year. In addition, Rayong Electricity Generating Co., Ltd. and Khahom Electricity Generating Co., Ltd. (çKEGCOé) are certified the TIS 18001 & OHSAS 18001: 1999 (Occupational Health and Safety Assessment Series). KEGCO also won the çNational Distinguished Workplace in terms of Safety, Occupational Health and Environmenté for 7 years consecutively.

Employee Involvement: The Company is well aware that the working environment is a key success factor. The Company then fosters regular communication among employees and senior management in an effort to encourage employees to provide comments and suggestions on ways to improve the working environment and working procedures and practices. For these purposes, Communication Day is launched to keep the employees well informed of the Companyûs activities. In addition, all employees have access to the members of the Good Corporate Governance and Employeesû Welfare Committees as well as a suggestion box. The proposals will be considered and measures wil be set to remedy the problem and promote good relationship among the employees and the Management. Apart from that, the Company encourages the employees to run personal interest programs to enhance the working environment experience and promote teamwork. For example, there are currently internal programs covering sport, entertainment and Buddhism. The Company provides financial support for these and other related activities that provide the benefits to the society such as the family trip, the green library, the tree planting on the mountainous area, the religious ceremonies, children day, beach cleaning day, etc.

We believe that the happy workforce will do their best to provide the benefits to the Company and all stakeholders.

EGCO...for the Society and Community The Company strongly believes that our success is intimately linked with the qualitative growth of Thai society at large.

In this regard, our vision and policies are designed to support activities that regularly contribute to the society and communities, especially the communities in which we operate in terms of promoting a quality of life and environment conservation. Key projects that EGCO has carried out in this area in 2006 include:

Sharing our Knowledge Recognizing that çknowledgeé is an essential factor for learning and self-development, EGCO has put much importance on the sharing of knowledge and business experience with the communities and society at large. This included 81

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providing an opportunity for government bodies, educational institutions, corporations and the public to visit EGCOûs power plants, giving students chance to undertake their practicum training with Group companies in accordance with their fields of study, and continually employing local people in several sections such as maintenance, service, and safety, thus generating income for the surrounding communities. In addition, the Group companies provided scholarships and support to the Children and Family Library Project of the Tai Wisdom Association, the çKnowledge for Thai Childrené Project initiated by the Revenue Department and the Green Classroom Project.

Employee Volunteer Program EGCO has always opened opportunities for its employees to initiate and support projects that contribute to local communities and society as a whole. The Company has continuously carried out activities such as the project to repair and maintain electrical and water supply systems and the project to donate funds and repair service for childrenûs playground facilities at local schools and community centers. For 2006, the employee volunteer programs included the donation of life support bags to the flood victims, lunch for children, reviving the Mountain Project, and the Green Library Project at Ban Nong Nasang School, Tambon Nue-Muang, Muang District, Roi-Et Province.

Supporting of Community and Charity Activities The Group companies provide support to community activities such as providing donation to the flood victims, help constructing the multi-purpose hall, arranging excursion for senior citizen and other charity activities.

Environmental Projects EGCO Group strives to use natural resources vital to its businesses in the most efficient manner and to operate responsibly to minimize any impacts that our activities may have upon the environment including, inter alia, those that may arise from noise, odors, chemicals, dust and waste water. In this regard, the Company continuously reviews its working policies to ensure that we are in compliance with the relevant environment regulations. As testament to our efforts to work in an environmentally friendly manner, there has been no report on our non-compliance with the environment laws and regulations. In addition, the groupûs two main subsidiaries Rayong Electricity Generating Co., Ltd. and Khanom Electricity Generating Co., Ltd. have successfully implemented the ISO 14001 international environment management system in their power generating processes.

We believe that every organization makes an effort to maintain proper balance between its business objectives, those of society at large and the environment. Such balance we believe will lead to the peaceful co-existence of humans and nature as well as promote successful business operations in the Thai society for the long-term. In this regard, EGCO has regularly incorporates the concepts of environmental and natural resource conservation into its business policies and budgets for we believe that promoting awareness of the importance of conservation is the best way that we can help to preserve and protect nature. This can be seen in several of the projects that EGCO seeks to promote such as Forest Conservation Project and the Thai Conservation of Forest Youth, among others, which are organized to promote environmental awareness among Thai children.

The above activities show our commitment for social responsibility in parallel with providing quality supply of power generation for the benefit of the stakeholders.

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Business Characteristics

EGCO is the first independent power producer in Thailand incorporated on May 12, 1992 by Electricity Generating Authority of Thailand (çEGATé). Such incorporation marked the commencement of the Thai governmentûs privatization initiatives to allow broader private sector investment in the electricity generating sector. EGCO was transformed into a public company on March 23, 1994 and listed on the Stock Exchange of Thailand ("SET") on January 16, 1995.

Since EGCO is a holding company, it recognizes revenue from dividend income and profit sharing of investment in subsidiaries and joint ventures which operate in electricity generation and distribution business to EGAT and industrial users under the long term Power Purchase Agreements ("PPA"). Its portfolio also covers the investment in related energy business. EGCO focuses to continue building upon its portfolio of power generation assets within both the domestic and ASEAN markets. In essence, the Companyûs corporate vision is: çTo be the leading Thai integrated electric power Company with comprehensive energy services in Thailand and in the ASEAN region, with full commitment to environment protection and social development supporté In this regard, EGCO has identified its key long term objectives as follows: Seek to grow at a rate higher than average demand growth in our target markets, Achieve returns on equity ("ROE") above the average of industry in Thailand, Create a healthy organization which excels in terms of good corporate governance and acceptance from the communities.

During 2007-2011, the Company would put priorities on projects in Thailand and cross border facilities that sell electricity back to Thailand.

Business Lines EGCO divides its business into 3 groups, namely, power business, water business and service business.

1. Power Business The power business comprises the Independent Power Producers (çIPPé) Group, Small Power Producers (çSPPé) Group and overseas Group.

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1.1 IPP Group In 2006, the Company had installed generation capacity of 2,414.6 MW, 85 percent of which was contributed by wholly owned subsidiaries Rayong Electricity Generating Company Limited (çREGCOé) and Khanom Electricity Generating Company Limited (çKEGCOé).

Operating Companies: REGCO REGCO, EGCOûs wholly owned subsidiary, owns and operates 4 blocks (308 MW each) of combinedcycle power station in Rayong province with the total capacity of 1,232 megawatt to generate and supply electricity to EGAT under a 20-year PPA. In 2006, REGCOûs net generation sold to EGAT was 5,837 million kilowatt-hours with an average Equivalent Availability Factor (çEAFé) of 92.63%, which was better than the target and merited a bonus payment from EGAT Plc. for the tenth consecutive year.

KEGCO KEGCO, another wholly owned subsidiary, owns 824-megawatt power plant which comprises of two 75-megawatt thermal power plants and one 674-megawatt combined-cycle power plant using natural gas as a primary fuel. KEGCO generates and supplies all electricity to EGAT under 15-year and 20-year PPAs. In 2006, KEGCO generated 5,348 million kilowatt-hours with the average EAF of 81.02%.

Assets under construction: Gulf Power Generation Company Limited (çGPGé) EGCO indirectly holds a 50% stake in this company through its 50% ownership stake in Gulf Electric Public Company Limited (çGECé). GPG is developing the Kaeng Khoi 2 (çKK2é) project, a 1,468 MW natural gasfired power plant in Saraburi province comprising two blocks of combined cycle power station with the capacity of 734 MW each using natural gas as main fuel. GPG generates and supplies all electricity to EGAT under a 25-year PPA. The commercial operation dates (çCODé) for block 1 and 2 are scheduled on March 1, 2007, and March 1, 2008, respectively.

At the end of 2006, the project progress was 93%. The first-firing of the Block 1 gas turbine power plants were already done.

1.2 SPP Group A. SPP under Thai LNG Power Corporation Limited (çTLPCé) TLP Cogeneration Company Limited (çTLP Cogené) EGCO holds an 80% stake in TLP Cogen comprising a direct 40% stake and another indirect 40% stake via TLPC. TLP Cogen was established to own and operate a 117-megawatt and 30-ton-per-hour steam using natural gas as a primary fuel. Under the SPPûs cogeneration program, TLP Cogen generates and supplies 84

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60-megawatt contracted capacity to EGAT under a 21-year PPA. Other net contracted capacity of 52.76 megawatt are generated and supplied to industrial users in the Rayong Industrial Park under the long-term PPAs. In 2006, TLP Cogen generated and sold 741 million kilowatt-hours comprising 429 million kilowatt-hours to EGAT and another 312 mil ion kilowatt-hours to industrial users. The average availability factor was 98.02%.

The total steam produced and sold to the industrial users was 41,952 tons.

B. SPP under EGCO Green Energy Company Limited ("EGCO Green") Roi-Et Green Company Limited ("Roi-Et Green") EGCO holds a 70.3% stake in Roi-Et Green via EGCO Green. Roi Et Green owns and operates a 9.9-megawatt biomass power plant using rice husk as a primary fuel. Under the SPPûs renewable program, Roi-Et Green generates and supplies 8.8-megawatt contracted capacity to EGAT under a 21-year PPA. In 2006, Roi-Et Green generated and sold 55 million kilowatt-hours to EGAT, with the average availability factor of 89.12%.

C. SPP under GEC EGCO indirectly holds a 50% stake in the following companies through its 50% ownership stake in GEC. Gulf Cogeneration Company Limited (çGCCé) GCC owns and operates a 110 megawatt and 16-ton-per-hour steam using natural gas as a primary fuel.

GCC generates and supplies 90-megawatt contracted capacity to EGAT under a 21-year PPA. Other net contracted capacity of 20 megawatt are generated and supplied to industrial users under the long-term PPAs. In 2006, GCC generated and sold 747 million kilowatt-hours to all customers, with the average availability factor of 93.93%. The total steam produced and sold to industrial users amounted to 151,167 tons.

Nong Khae Cogeneration Company Limited (çNKCCé) NKCC owns and operates a 126-megawatt and 24-ton-per-hour steam using natural gas as a primary fuel. NKCC generates and supplies 90-megawatt contracted capacity to EGAT under a 21-year PPA. Other net contracted capacity of 36 megawatt are generated and supplied to industrial users under the long-term PPAs. In 2006, NKCC generated and sold the electricity to all customers of 794 million kilowatt-hours, with the accumulated availability factor for the year 2006 of 86.88%. The total steam produced and sold to industrial users amounted to 176,796 tons.

Samutprakarn Cogeneration Company Limited (çSCCé) SCC owns and operates a 126-megawatt and 35-ton-per-hour steam using natural gas as a primary fuel.

SCC generates and supplies 90-megawatt contracted capacity to EGAT under a 21-year PPA. Other net contracted capacity of 36 megawatt are generated and supplied to industrial users under the long-term PPAs. In 2006, SCC generated and sold 780 million kilowatt-hours to all customers with the average availability factor of 93.69%. The total steam produced and sold to industrial users amounted to 123,384 tons.

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Gulf Yala Green Company Limited (çGYGé) GYG builds, owns and operates a 23-megawatt Gulf Yala Green biomass power plant using parawood as a primary fuel. GYG generates and supplies 20.2-megawatt contracted capacity to EGAT under a 25-year PPA. GYG started its operation on November 28, 2006, approximately 2 months behind the scheduled COD which was on October 1, 2006. In 2006, GYG generated and sold 10 million kilowatt-hours to EGAT, with the average availability factor of 85%.

D. SPP under EGCO Joint Ventures & Development Co., Ltd. (çEGCO JDé) Amata-EGCO Power Limited (çAEPé) EGCO holds 14.85% in AEP via EGCO JD. AEP owns and operates a 165 megawatt co-generation plant and a steam generating capacity of 15 megawatts thermal using gas as a primary fuel. AEP provides 90 megawatts to EGAT pursuant to a 21-year PPA and also sells 75 megawatts to industrial users under the long-term PPAs. In 2006, AEP generated and sold 1,070 mil ion kilowatt-hours with the average availability factor of 96.00%.

Amata Power (Bang Pakong) Limited (çAPBPé) EGCO holds 15% in APBP via EGCO JD. APBP owns and operates a 112 megawatt co-generation plant and a steam generating capacity of 15 megawatts thermal using natural gas as a primary fuel. APBP generates and supplies 90-megawatt contracted capacity to EGAT under a 21-year PPA. Other net contracted capacity of 22 megawatts are generated and supplied to industrial users in Amata Industrial Estate under the long-term PPAs. In 2006, APBP generated and sold 810 million kilowatt-hours, with the average availability factor of 90.92%.

At the end of 2006, the progress of a 55-megawatt APBP expansion project was 96%. The scheduled COD is expected in the first quarter of 2007.

1.3 Overseas Group A. Operating Companies Conal Holdings Corporation ("CHC") EGCO holds a 40% stake in CHC via EGCO International (BVI) Limited (çEGCO BVIé). CHC is the largest IPP on the Mindanao Island, the Philippines. CHC holds shares in 3 power companies and 1 operation and maintenance service company.

Northern Mindanao Power Corporation (çNMPCé) NMPC has a PPA with National Power Corporation (çNPCé) under the Build-Operate-Transfer (çBOTé) scheme for two units of diesel fired power plant with the capacity of 60.9 megawatts and 40 megawatts located in the island of Mindanao, the Philippines. NMPC had transferred the 60.9-megawatt and 40megawatt power plants to NPC at the expiry of the 10-year and 12-year term in July 2003 and February 2006, respectively.

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In 2006, NMPC generated and sold 5 million kilowatt-hours to NPC with the average availability factor of 97.58%.

Western Mindanao Power Corporation (çWMPCé) WMPC operates and owns a 100-megawatt diesel power plant located in the island of Mindanao, Philippines. Under the Build-Operate-Own (çBOOé) scheme, WMPC generates and supplies all electricity to NPC under an 18-year PPA with the expiry in 2017.

In 2006, WMPC generated and sold 225 million kilowatt-hours to NPC with the average availability factor of 97.05%.

Southern Philippines Power Corporation (çSPPCé) SPPC operates and owns a 50-megawatt diesel power plant located in the island of Mindanao, Philippines. Under the BOO scheme, SPPC generates and supplies all electricity to NPC under an 18-year PPA with the expiry in 2016.

In 2006, SPPC generated and sold 192 million kilowatt-hours to NPC with the accumulated availability factor of 92.29%.

Alto Power Management Corporation (çAPMCé) APMC provides operation and maintenance services including plant management to the three above-mentioned power plants and also third party power plants.

B. Assets under construction: Nam Theun 2 Power Company Limited (çNTPCé) NTPC has the installed capacity of 1,070 megawatts located in Lao PDR. It has an initial registered capital of USD 1 million. Currently, EGCO holds a 25% stake of NTPC, while EDF International (a subsidiary of Electricite de France), Laos State Holdings Enterprise (LHSE), and Italian-Thai Development Public Company Limited own 35%, 25%, and 15%, respectively.

NTPC signed a 25-year Concession Agreement with the Government of Lao PDR on October 3, 2002. NTPC also signed PPAs with EGAT and EDL on November 8, 2003 to supply 995 megawatts to EGAT and additional 75 megawatts to EDL for 25 years after the COD. On April 29, 2004, the project achieved the Financial Close and the first drawdown was on June 15, 2005.

At the end of 2006, the project progress was 37.70%, a little behind schedule. However, it was expected that the project could achieve the COD in December 2009 as planned.

2. Service Business EGCO Engineering & Service Company Limited (çESCOé) ESCO is EGCOûs wholly owned subsidiary which provides operation, maintenance, engineering and construction services to power plants, petrochemical plants, oil refineries and other industries including the Group companies.

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3. Water Business Egcom Tara Company Limited (çETé) EGCO holds an indirect 70% stake in ET via ESCO. Under a 30-year agreement, ET produces tap water according to Thai Industrial Standard (çTISé) and supplies it to the three water stations of the Provincial Waterworks Authority of Thailand ("PWA"), namely, Pak Tor Water Station, Damnoen Saduak Water Station and Samut Songkhram Water Station.

Eastern Water Resources Development and Management Public Company Limited (çEast Wateré) At the end of November 2006, EGCO holds 18.57% of shares in East Water which is responsible for supplying raw water in the Eastern Seaboard of Thailand covering 7 provinces namely, Rayong, Chonburi, Chachoengsao, Prachinburi, Srakaew, Chantaburi and Trad.

Conclusion of Significant Changes EGCO and the Group companies are successful in conducting its business with good operating performance.

During the year, there was no disabling injury occurring in a company that EGCO was a major shareholder. The major activity during the year is the acquisition of shares in BLCP Power Company Limited (çBLCPé).

BLCP was incorporated on September 30, 1997. BLCPûs major shareholders included the CLP Holdings Limited Group and the Banpu Public Company Limited Group, each holding a 50 % stake in the company.

BLCP entered into the PPA with EGAT under the IPP Program by constructing two coal-fired power plants, locating in Map Ta Phut Industrial Estate in Rayong. The BLCP Power Plant Project had an installed capacity of 717 MW per unit, totaling 1,434 MW for the Project. The scheduled commercial operation dates (çSCODé) of Unit 1 and Unit 2 were on October 1, 2006 and February 1, 2007, respectively. The term of the PPA was 25 years from the SCOD of Unit 2, and would expire in the Year 2032. Unit 1 of BLCP Power Plant Project had passed the relevant tests as required by EGAT and began to distributing electricity to EGAT since mid of August 2006.

BLCP imported high quality coal to be used as the primary fuel of the plant. It entered into the Coal Supply & Transportation Agreement (çCSTAé) with a term of 25 years with Australian Coal Holdings Pty Ltd. (çACHé) from Australia.

EGCO entered into the agreement to purchase 50% of the total common shares of BLCP from CLP Power (BLCP) Limited (çCLP-BLCPé) and two individual shareholders, namely, Mr. James Richarde Truscott and Mr. Mark Takahashi at the price of 6,645 mil ion baht. Since such transaction was considered a connected one, EGCO sought the approval from the shareholders in the Extraordinary General Meeting no. 1/2006 on December 1, 2006. The benefits of the transaction were as follows. Investing in BLCP increased the Companyûs market shares in the domestic power generation and distribution business; Investing in BLCP increased the Companyûs revenue and profitability from investing in the BLCP Power Plant Project; Investing in BLCP helped to increase the Companyûs experience in operating and maintaining coal-fired power plants and diversify source of fuel; Investing in BLCP allowed the Companyûs to participate in an IPP project which was nearly fully complete and had already commenced operation of its first unit ahead of schedule, thus substantially reducing pre-operating risk and allowing the Companyûs to realize revenue from investment immediately.

Revenue Structure The revenue structure of each business line is as shown in the table below.

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Revenue Structure of EGCO and Subsidiaries

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Thai Economy 2006

In 2006, the Thai economy improved slightly from the previous year. The satisfactory expansion of export and the sharp slowdown in import resulted in a surplus in the trade balance. The current account also reverted back into surplus thanks primarily to the improvement of service balance, income account, and transfer payments. However, domestic demand slowed down from the previous year as private investment and import value decelerated, while the consumption index rose slightly. Production in the agricultural sector expanded considerably because of the continuous rise in prices, but a slowdown occurred in the manufacturing sector as a result of persistently high oil prices and declining domestic demand.

Private consumption index expanded 1.3 percent in 2006, an increase from 0.6 percent in the previous year.

Meanwhile, the other private consumption indicators slowed down due to the rise in inflation and interest rates which increased caution in consumers没 spending.

Trade balance reverted from a deficit of USD 8.5 billion in the previous year to a surplus of USD 2.2 billion. Export rose by 17.4 percent thanks primarily to the technology intensive industries. Meanwhile, import expanded 7.0 percent, a deceleration from last year as a result of declining domestic demand. The service balance, income account, and transfer payments registered a surplus of USD 1.0 billion, an increase from the previous year due to tourism revenue.

Headline and core inflation for 2006 stood at 4.7 percent and 2.3 percent, a rise from 4.5 percent and 1.6 percent in 2005, respectively.

Money supply in the first half of 2006, commercial bank deposits grew due to competitive hikes in interest rates to maintain customer base. However, in the second half of 2006 commercial bank deposits slowed down in line with the decline in competition. Commercial bank credit slowed down for the whole year of 2006.

Money market interest rates during the first half of 2006, short-term money market rates rose in line with the rising policy rate and stood at a stable level from mid-2006 onward. The 1-day repurchase rate and the overnight interbank rate averaged 4.64 and 4.69 percent per annum, respectively, higher than the previous year.

Exchange rate in 2006, the baht averaged 37.93 baht per U.S. dollar, a sharp appreciation from 40.29 baht per U.S. dollar in 2005. The baht was in a rising trend throughout 2006.

Source: Bank of Thailand

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Thailandûs Economic Trend in 2007

In 2007, it is expected that a slowdown of the world economy and the baht appreciation will have an adverse impact on exports in agricultural and industrial products. The service sector is anticipated to expand continuously on account of increasing number of foreign tourists. Private consumption and domestic investment will likely benefit from growth in construction and business sectors.

Positive Factors 1. Average oil price is likely to be more stable in 2007. This will in turn boost business competitiveness and confidence which should lead to increases in production.

2. Inflationûs declining trend wil lead to higher purchasing power and consumer confidence.

3. Interest rates have been more stable and shown a clearer trend which will enable the business sector and consumers to better estimate their financing cost.

Risk factors External factors A slowdown of the world economy in 2007 may impact exports and tourism. The world economy has continued its downward trend since the latter half of 2006. The U.S. adopted the tightening monetary policy over the past two years by raising interest rates to help ease inflationary pressure and a current account deficit.

Consequently, household consumption has slowed down and investment in the real estate sector declined but the U.S. current account deficit stil grew larger. The Chinese economy also showed a slowdown in 2006 as a result of rising interest rates and limited credit expansion to cool down overheated investment.

Internal factors associated with the economic prospect are as follows: 1. A recovery of private investment is still uncertain. It is expected that some investors will postpone their decisions until after the next general election in Thailand. As for foreign investors, they will wait for the amendment of Alien Business Act to be completed; the focus will be on foreign shareholdersû voting rights and equity ownership as well as the opening up of some sectors which were previously under control of Thais only. In addition, production costs have risen somewhat following a minimum wage raise. The approved projects from the Board of Investment (BOI) declined in the year 2006. These are leading indicators that investment in 2007 may not be able to fully recover.

2. Agricultural productsû prices, particularly prices of rubber, corn and paddy, have weakened and will adversely affect farmersû income.

3. Adjustment is expected in the export-oriented production sector which is facing more stringent trade measures since the beginning of 2007 as the U.S. will not allow the Generalized Systems of Preferences (GSP) to resume for Thailandûs export of jewelry and precious stone, and television.

Source: Office of the National Economic and Social Development Board

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Power Industry and Competition

The peak demand in 2006 was on May 4, 2006 at 21,064 MW, marking an increase of 526 MW or 2.56% from the previous year (figure 1). The actual figure was lower than the load forecast. The total electricity generation was 142,112.18 mil ion kWh, increased by 7,219 million kWh or 5.35% from the previous year (figure 2).

As of December 31, 2006, the total installed capacity of Thailandûs power system was 27,107.20 MW of which approximately 15,794.56 MW, 8,610.34 MW, 2,062.30 MW representing 58.37%, 31.76% and 7.61% of the total capacity was owned by the Electricity Generating Authority of Thailand (çEGATé), Independent Power Producers (çIPPé), and Small Power Producers (çSPPé). The balance of 640 MW or 2.36% of the total capacity was imported from Laos and Malaysia.

Due to the economic slowdown, higher electricity tariff rate and the governmentûs successful energy-saving measures, the actual electricity demand became lower than the underling load forecast of the Power Development Plant (çPDPé) issued in 2004. Therefore, EGAT was in the progress of revising the PPD with an updated load forecast.

Following the coup dûetat in September 2006 and the resignation of the Electricity Regulatory Board in October, the Ministry of Energy was developing a new regulatory framework for the Electricity and the Natural Gas Supply Industries.

During the transition period, electricity tariff, load Forecast, PDP, and IPP Bidding is under the responsibility of the National Energy Policy Council (çNEPCé).

It is expected that the next round IPP Bidding will be launched around the second quarter of 2007. Furthermore, with the support of the Ministry of Energy to encourage more competition to optimize consumer benefits, EGAT subsidiaries are allowed to participate in the new bidding. It is likely that the portion of coal fuel will increase to create more balance in fuel diversification of power generation in the country.

Several private IPP companies are willing to participate in the new IPP Bidding program such as Ratchaburi Electricity Generating Holding PCL., Glow Energy Public Company, and Independent Power (Thailand) Company Limited which wil lead to strong competition for the upcoming IPP biding which will benefit the country. EGCO has developed our experience and expertise with our strong financial position to participate and maximize our competitive advantages in this round of bidding.

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Figure 1 : Peak Demand 2002-2006

Peak Demand 2002-2006 22,000.00

MW

20,000.00 18,000.00 16,000.00 14,000.00 Jan

Feb

Mar

Apr May Jun Jul 2002 2003 2004

Aug 2005

Sep Oct 2006

Nov

Dec

Sep

Nov

Dec

Source: EGAT Figure 2 : Electricity Generation 2002-2006

Electricity Generation 2002-2006 13,000 12,000

MW

11,000 10,000 9,000 8,000 Jan

Feb

Mar

Apr 2002

May

Jun 2003

Jul 2004

Aug 2005

Oct

2006

Source: EGAT

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Management Discussion and Analysis 1. Executive Summary The Electricity Generating Public Company Limited (çEGCOé) is an Independent Power Producer (çIPPé) with 13 operating plants totaling 3,133.6 equity MW after the completion of share payment and share transfer for the acquisition of a 50% stake in BLCP, a 1,434 MW coal-fired power plant, from CLP Power (çBLCPé) Ltd. on January 30, 2007.

EGCO Groupûs consolidated net profit for 2006, ended December 31, 2006, was Baht 6,036 million, an increase of Baht 1,943 million or 48% compared to 2005.

Excluding the impact of foreign exchange, the net profit was Baht 5,270 million, representing an increase of Baht 892 million or 20% as compared to the previous year. The details of net profit (before FX) are as follows: EGCOûs net loss of Baht 165 million, representing a decrease in net profit of Baht 169 million, resulted from a drop in income by Baht 85 mil ion, mostly from lower dividend income and other income, plus higher administrative expenses of Baht 84 million mostly from historical development cost of Nam Theun 1.

IPP Group, consisting of Rayong Electricity Generating Co., Ltd. (çREGCOé) and Khanom Electricity Generating Co., Ltd. (çKEGCOé), showed a net profit for both companies of Baht 4,928 mil ion, up Baht 720 million thanks to higher sales of electricity.

Small Power Producer (çSPPé) Group, which is comprised of five companies including Gulf Electric Public Company Limited (çGECé), Amata-EGCO Power Ltd. (çAEPé), Amata Power (Bang Pakong) Ltd. (çAPBPé), TLP Cogeneration Co., Ltd. (çTLP Cogené) and Roi-Et Green Co., Ltd. (çRoi-Et Greené), reported a net profit of Baht 126 mil ion, a decrease of Baht 173 mil ion which resulted primarily from an increase in GECûs cost of sales, administrative expenses and interest expenses.

Overseas Group refers to the Conal Holdings Corporation (çConalé) and Nam Theun 2 Power Co., Ltd. 94

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(çNTPCé). The net profit from this group was Baht 119 million, up by Baht 423 million mainly resulting from NTPCûs recording of net loss of Baht 29 million in 2006 whilst it reported net loss of Baht 455 million in 2005, mostly from development expenses of Baht 280 million.

Other Business Group includes two subsidiaries, EGCO Engineering & Service Co., Ltd. (çESCOé) and Egcom Tara Co., Ltd. (çETé) from which net profit totaled Baht 262 million, an increase of Baht 91 million due mostly to higher service income from ESCO.

2. Business Expansion Analysis EGCO was the first IPP in Thailand established in 1992. EGCO is structured as a holding company with a number of subsidiaries. The Companyûs vision is to be the leading Thai integrated electric power company with comprehensive energy services in Thailand and in the ASEAN region, and full commitment to environmental protection and social development.

Our major business is to produce electricity and supply it to Electricity Generating Authority of Thailand (çEGATé) under long-term power purchase agreements (çPPAé). EGCO focuses its investment on pursuing opportunities in power generation in Thailand and also seeks to expand its business in ASEAN countries with the aim to provide strong returns to shareholders by improving the profitability of our existing assets and acquiring new projects with acceptable risk and return profiles.

As at the end of December 2006, Thailandûs total generating capacity was reported at 27,107 MW1 , of which 10.24% was attributable by EGCO. During the year 2006, the peak demand reached 21,064 MW1 in May, which was 2.56% higher than the peak demand in April 2005.

Due to the economic slowdown, higher electricity tariff and the governmentûs successful energy-saving measures, the actual electricity demand becomes lower than the forecast that Thailand Load Forecast Subcommittee announced in 2004.

Therefore, the Power Development Plan for 2007-2021 is in the process of revision.

The next round of IPP Bidding is scheduled to be launched in 2007. EGCO has already undertaken extensive preparation works in anticipation of this opportunity.

From February 1,2007, EGCO has 13 operating plants with capacity totaling 3,133.6 equity MW, of which 66% is comprised of two natural gas-fired IPPs which are the 1,232 MW REGCO plant and the 824 MW KEGCO plant.

Moreover, on January 30, 2007, EGCO completed the acquisition of 50% of the BLCP Power facility, a 1,434 MW coalfired power plant situated in Map Ta Phut Industrial Estate in Rayong Province. The BLCP facility uses high quality imported coal from Australia. The shares in BLCP were acquired from CLP Power (BLCP) Ltd., a subsidiary of CLP Holdings Limited. As a result, EGCO has acquired 717 equity MW representing 23% of the companyûs total equity MW portfolio. The first unit achieved commercial operation on October 1,2006 and the second unit on February 1,2007.

In addition to the operating assets, EGCO is a partner in three additional power plant projects that are under development. These projects represent an additional 1,010 equity MW. Each is summarized briefly below: 1. The Kaeng Khoi 2 (çKK2é) project, a 1,468 MW natural gas-fired power plant located in Saraburi Province. EGCO has a 50% stake in this project by holding 50% of shares in GEC, which owns 99.99% of Gulf Power Generation Co., Ltd. (çGPGé), the KK2 project company. The commercial operation dates (çCODé) for units 1 and 2, each with the capacity of 734 MW, are scheduled to occur in March 2007 and March 2008, respectively. Currently, the overall progress for this project is 93%.

2. The Nam Theun 2 project is a 1,070 MW hydroelectric power plant situated in the Lao PDR. EGCO holds a 25% ownership stake in the project company, NTPC. This projectûs COD is targeted for December 2009 with EGAT 1

Source : Egat 95

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contracted to take off 995 MW and the balance to be sold to the Lao PDR. At the end of the year 2006, the overall project progress was 39% complete.

3. The Amata Power Bang Pakong Expansion (çAPBP-Expansioné) Project, a 55 MW combined cycle gas turbine power plant supplying industrial users in Amata Nakorn Industrial Park. EGCO has a 15% stake in this project by holding 50% of shares in EGCO Joint Ventures and Development Co.,Ltd (çEGCO JDé), which owns 30% of APBP. EGCOûs partner in EGCO JD is Chevron Bang Pakong Power Holding Ltd., which is a subsidiary of Chevron Corporation of the USA. This project has been in construction since June 2005 and the COD is scheduled for the 1s t quarter of 2007. Presently, the project is 96% complete.

In the absence of unforeseen circumstances, the company has a policy to dividend approximately 40% of the net profit after taxation, or to increase the dividend amount in a steady manner, to the shareholders. This dividend policy may change in the light of investment opportunities that may become available to the company or as a result of other economic or financial factors or when a dividend payment may have a significant impact on the normal operation of the company.

3. Report and Analysis of the Operating Results EGCO is structured as a holding company and it invests primarily in electricity generation and energy service businesses. The main sources of its income are dividends from investments in its subsidiaries, joint ventures, and associates.

The objective of the holding company structure is to provide flexibility for business expansion and to facilitate financing of new projects without recourse to existing ones.

During the third quarter of 2005, NTPC has commenced the construction of the power plant in the Lao PDR and EGCO has entered into the agreement to provide credit support in the form of Standby Letters of Credit (çSBLCé) for its agreed equity commitments to NTPC of USD 94 million. Accordingly, investment in NTPC has been accounted for under the proportionate consolidation method in the consolidated financial statements since the third quarter of 2005 because its financial statements were material to EGCO Group.

This report contains the analysis of the financial statements of EGCO and its subsidiaries as follows:

3.1 Operational Results EGCO Groupûs consolidated net profit for 2006 ending December 31, 2006 was Baht 6,036 million, an increase of Baht 1,943 mil ion or 48% compared to 2005. The gross profit was reported at Baht 9,060 million, up Baht 1,189 million or 15% as compared to 2005 as a result of higher electricity sales of REGCO and KEGCO. The operating profit was reported at Baht 9,158 mil ion, an increase of Baht 2,494 million or 37% as compared to 2005. This was thanks to higher electricity sales, gain on foreign exchange rates following the Baht appreciation and higher interest income that resulted from higher interest rates.

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Others 4% SPP 9%

IPP 87%

Net Profit after FX-2006 Remarks:

EGCO IPP Group SPP Group Overseas Others

- IPP : REGCO, KEGCO - Overseas : Conal, NTPC

Net Profit of 2006 Before FX After FX (165) (165) 4,928 5,480 126 563 119 (107) 262 264

Unit : Mil ion Baht Net Profit of 2005 Before FX After FX 4 57 4,208 3,973 299 199 (304) (304) 170 169

- SPP : GEC, AEP, APBP, TLP Cogen, Roi-Et Green - Others : ESCO, ET

The EGCO Groupûs 2006 net profit included foreign exchange gain of Baht 766 million whereas it incurred a foreign exchange loss of Baht 285 million for 2005. An unrealized foreign currency exchange gain in the amount of Baht 691 million is an accounting number in accordance with the Thai accounting standard. It incurs from the difference of the translation of the net debt denominated in foreign currency to the Thai Baht equivalent amount using the foreign exchange rate at the end of this accounting period (December 31, 2006) and the previous period (December 31, 2005).

Excluding the effect of foreign currency exchange gain, the profit was Baht 5,270 million, representing an increase of Baht 892 million or 20% as compared to 2005.

Excluding the effect of foreign currency exchange gain of Baht 766 million, interest expenses of Baht 1,557 mil ion, income tax of Baht 1,277 million and depreciation and amortization of Baht 2,806 million, the earnings before interest, tax, depreciation and amortization (çEBITDAé) would be Baht 10,910 million, representing an increase of Baht 1,130 mil ion or 12% as compared to 2005, in which the EBITDA was Baht 9,780 million, excluding the effect of foreign currency exchange loss of Baht 285 million, interest expenses of Baht 1,859 million, income tax amounting to Baht 475 million and depreciation and amortization amounting to Baht 3,067 million.

Important Financial Ratios for the period were as follows; - Gross Profit Ratio was 50.28% - Operating Profit Ratio was 50.82% - Net Profit Ratio was 31.66% - Net Profit Ratio (excluding the effect of foreign exchange) was 27.64% - Earnings per share (çEPSé) was Baht 11.46 - Earnings (excluding the effect of foreign exchange) per share (EPS) was Baht 10.01 - Return on Equity (çROEé) was 18.17% The gross profit margin of 50.28% was slightly higher than last yearûs margin of 49.13%. The net profit ratio (excluding the effect of foreign exchange) was reported at 27.64%, higher than the 2005 ratio of 25.98% mainly due to an increase of REGCO and KEGCOûs net profit as well as a decrease of NTPCûs expenses.

3.2 Income and Expenses Analysis The 2006 total revenues of EGCO, its subsidiaries and joint ventures as well as the share of profits from its associates and interests in joint ventures (excluding the effect of foreign currency exchange rate and profit attributable to minorities) were Baht 19,067 million, an increase of Baht 2,214 million or 13% compared to 2005. The 2006 total expenses of EGCO, its subsidiaries and joint ventures were Baht 13,466 million, an increase of Baht 1,254 million or 10% from last year. The details according to their groups of business are as follows: 97

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Total Revenues and Expenses:

Total Revenues Total Expenses

Unit : Mil ion Baht EGCO IPP SPP Overseas Others Total 2006 2005 2006 2005 2006 2005 2006 2005 2006 2005 2006 2005 393 478 11,053 9,572 5,853 5,287 765 847 1,004 669 19,067 16,854 558 474 6,125 5,364 5,597 4,917 484 990 703 468 13,466 12,212

1) EGCOûs 2006 total revenues, amounting to Baht 393 million, were comprised of dividend income from financial investment of Baht 168 million, interest income of Baht 163 million and other income of Baht 62 million. This showed a decrease of Baht 85 million or 18% as compared to 2005, mainly from the decline in by Baht 79 million or 56% and decline in income by Baht 73 million or 30%; whereas interest income reported an increase of Baht 67 million or 70% thanks to higher interest rates. The fall in other income was mainly due to lower NTPCûs net reimbursement of additional internal development cost according to Shareholdersû Agreement amounting to Baht 29 million in 2006 compared to Baht 110 mil ion in 2005.

EGCOûs dividend income is essentially from Krung Thai Dividend Selected Flexible Portfolio Fund (çKTSFé) in the amount of Baht 130 million representing a decrease of Baht 1 million as compared to 2005; dividends from Eastern Water Resources Development and Management Public Company Limited (çEASTWé) of Baht 31 million, down by Baht 61 million and dividend from others of Baht 8 million, down by Baht 11 million.

Total expenses of EGCO, which were administrative expenses, totaled Baht 558 million, an increase from 2005 by Baht 84 million or 18% due to the incurrence of Nam Theun 1ûs historical development cost amounting to Baht 47 million, financing fees on the SBLCs for the equity commitment to NTPC in the amount of Baht 10 million as well as the companyûs contribution for the 60t h Anniversary Celebration of His Majestyûs Accession to the Throne and the International Horticultural Exposition for His Majesty the King (Royal Floral Ratchaphruek 2006) totaling Baht 9 million.

2) IPP Group consisting of two principal subsidiaries, REGCO and KEGCO, represented Baht 11,053 million in the total revenues, up by Baht 1,480 million or 15% as compared to 2005 whilst the total expenses were Baht 6,125 mil ion, up by Baht 760 mil ion or 14%. The details are as follows: Total Revenues and Expenses of IPP Group: REGCO 2006 2005 Revenues 5,630 5,131 Expenses 2,943 2,872

Unit : Mil ion Baht KEGCO 2006 2005 5,422 4,441 3,182 2,493

2006 11,053 6,125

Total 2005 9,572 5,364

% Changes 15% 14%

Sales of electricity of IPP Group were Baht 10,665 million, representing an increase of Baht 1,287 million or 14% compared to last year. The increase was a result of a growth in REGCOûs electricity sales of Baht 353 million to be Baht 5,392 mil ion and KEGCOûs electricity sales of Baht 934 million to be Baht 5,273 million. These increases were caused by an increase in the Capacity Rate for REGCO and the Base Availability Credit for KEGCO which was in accordance with the capacity payment formula calculated on a çCost Plus Basisé under the PPAs and in line with the companyûs projection.

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Sales of Electricity - IPP Group: REGCO KEGCO Total Sales of Electricity - IPP

2006 5,392 5,273 10,665

2005 5,039 4,339 9,378

Unit : Mil ion Baht % Changes 7% 22% 14%

The PPAs cover the full amount of the projected fixed costs, debt financing charges and major maintenance charges, which are used in calculating the electricity tariffs for each period. Moreover, the calculation of the capacity payment is adjusted to include compensation for the exchange rate effect from debt services and expenses of major maintenance parts denominated in US Dollar. REGCO and KEGCO receive the compensation monthly for each billing period. They receive higher capacity charge than that stated in the original PPAs before the inclusion of foreign exchange indexation if the exchange rate is above Baht 28 per US Dollar and vice versa.

In 2006, REGCO and KEGCO received compensation for the exchange rate effect of Baht 810 million.

Interest income and others amounted to Baht 388 million, an increase of Baht 194 million or 100%, mainly from REGCOûs increased interest income in the amount of Baht 143 million. It resulted from higher amount of deposits at banks and financial institutions due to EGCOûs equity injection in REGCO, together with higher interest rates. However, the process of capital reduction of REGCO from Baht 9,220 million to Baht 4,702 million was completed in December 2006. KEGCOûs interest income increased by Baht 47 million resulting from an increase in interest rates. REGCO and KEGCOûs other revenues increased by Baht 4 million.

Cost of sales totaled Baht 3,548 million, an increase of Baht 280 million or 9% compared to 2005, mainly because KEGCOûs cost of sales increased by Baht 378 million or 26% from major maintenance expenses as planned; whilst REGCOûs cost of sales decreased by Baht 98 million or 5% as compared to 2005 when the replacement of the impaired steam turbine rotor took place.

Cost of Sales - IPP Group: REGCO KEGCO Total Cost of Sales - IPP Group

2006 1,737 1,811 3,548

2005 1,834 1,434 3,268

Unit : Mil ion Baht % Changes (5%) 26% 9%

Administrative expenses and income taxes were Baht 1,525 million, an increase of Baht 886 million or 139%, mainly from KEGCOûs first corporate tax payment amounting to Baht 521 million. Although KEGCOûs BOI tax exemption privilege for 8 years ended on September 25, 2004, the loss carried forward was utilized up until the end of 2005. Thereafter the 50% corporate tax reduction privilege is applied. This 5-year tax reduction privilege will end on September 25, 2009.

In addition, REGCOûs corporate tax payment increased by Baht 188 million resulting from its increased profitability.

REGCOûs 50% corporate tax reduction will end on April 19, 2008. And its administrative expenses were up by Baht 209 mil ion mainly from the make-whole premium payment of Baht 193 million.

Interest expenses were Baht 1,051 million, a decrease of Baht 406 million or 28%, resulting from the decrease in interest expenses at REGCO and KEGCO of Baht 228 million and Baht 178 million, respectively, owing to lower principal amounts of loans and debentures.

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3) SPP Groupûs total revenues were reported at Baht 5,853 million for 2006, an increase of Baht 566 million or 11% compared to 2005. The SPP Group incorporates five companies, GEC, AEP, APBP, TLP Cogen and Roi-Et Green.

The expenses were Baht 5,597 million, an increase from last year by Baht 680 million or 14%. The details are as follows: Total Revenues and Expenses of SPP Group: GEC TLP Cogen 2006 2005 2006 2005 Revenues 3,217 3,034 1,985 1,738 Expenses 3,498 3,032 1,648 1,436

APBP 2006 2005 405 314 308 310

Roi-Et Green 2006 2005 246 202 143 139

2006 5,853 5,597

Unit : Mil ion Baht Total 2005 %Changes 5,287 11% 4,917 14%

Sales of electricity of the SPP Group were Baht 5,700 million, representing an increase of Baht 512 mil ion or 10% compared to last year. Most of the increase of SPP groupûs electricity sales was from TLP Cogen, GEC, APBP and Roi-Et Green in the amount of Baht 235 million, Baht 151 million, Baht 81 million and Baht 45 million, respectively. The TLP Cogenûs increased electricity sales were a result of higher tariff and units of sales to EGAT and industrial users. The increase of GECûs electricity sales was due to peak-load demand calls from EGAT. APBPûs electricity sales showed an increase in 2006 when compared to the same period of 2005 in which a physical impairment of an electricity generating equipment happened. And the increase of Roi-Et Greenûs electricity sales came from higher tariff thanks to the tariff formula that is linked to the price of fuel oil.

Sales of Electricity- SPP Group: GEC TLP Cogen APBP Roi-Et Green Total Sales of Electricity - SPP Group

2006 3,168 1,962 338 233 5,700

2005 3,017 1,727 257 187 5,188

Unit : Mil ion Baht %Changes 5% 14% 31% 24% 10%

Interest income and others amounted to Baht 111 million, an increase of Baht 38 million or 51%, mainly from an increase of GECûs interest income of Baht 30 million as well as an increase of TLP Cogenûs interest income of Baht 12 mil ion thanks to higher interest rates. In contrast, APBPûs other income showed a decrease in the amount of Baht 6 mil ion since there was a recognition of insurance claims of a physical impairment of an electricity generating equipment in 2005; Roi-Et Greenûs other income was down as well by Baht 5 million from lower income from selling bagasse and ashes.

Share of profit from an associate was from AEP totaling Baht 42 million, an increase of Baht 16 million or 60% as compared to 2005 due to increased electricity sales to EGAT and industrial users.

Cost of Sales of SPP Group were reported at Baht 4,654 mil ion, an increase of Baht 454 mil ion or 11% as compared to 2005. This was substantially driven by an increase in cost of sales of TLP Cogen amounting to Baht 228 million from higher fuel costs and usages as well as an increase in cost of sales at GEC amounting to Baht 224 million owing to major maintenance cost plus maintenance expense incurred from the spare part replacement in the gas turbine. The APBPûs cost of sales was Baht 1 million higher; Roi-Et Greenûs cost of sales was also up by Baht 1 million.

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Cost of Sales - SPP Group: GEC TLP Cogen APBP Roi-Et Green Total Cost of Sales - SPP Group

2006 2,727 1,541 272 114 4,654

2005 2,503 1,313 271 113 4,200

Unit : Mil ion Baht %Changes 9% 17% 0.19% 1% 11%

Administrative expenses and income taxes were Baht 511 million, up by Baht 122 million or 31% as compared to 2005. This increase was substantially from GECûs administrative expenses and income taxes which were higher by Baht 126 million, totaling Baht 462 million, that resulted mainly from prepayment fee and debt refinancing fees at GECûs 3 subsidiaries, namely: Gulf Cogeneration Co., Ltd. (çGCCé), Nong Khae Cogeneration Co., Ltd. (çNKCCé), and Samutprakarn Cogeneration Co., Ltd. (çSCCé).

Interest expenses were Baht 432 million, an increase of Baht 104 million or 32%, driven mainly by an increase in GECûs interest expenses amounting to Baht 116 million due to an unwind cost of Interest Rate Swap Agreement and loan drawdown for administrative expenses for Khaeng Khoi 2 Project. TLP Cogen and Roi-Et Greenûs interest expenses were down by Baht 12 million and Baht 2 million, respectively, owing to lower principal amounts.

4) Overseas Group refers to Conal and NTPC, of which their revenues were Baht 765 million, a decrease of Baht 83 mil ion or 10% compared to 2005. The expenses were Baht 484 million, a decrease of Baht 506 million or 51% compared to 2005, owing to the following reasons: Total Revenues and Expenses of Overseas Group: Conal 2006 2005 Revenues 762 844 Expenses 452 533

Unit : Mil ion Baht NTPC 2006 2005 3 3 31 458

2006 765 484

Total 2005 847 990

%Changes (10%) (51%)

Sales of electricity of the Overseas Group were Baht 676 million, a decrease of Baht 126 million or 16% compared to last year. This resulted from the contractual transfer of the 40 MW of Northern Mindanao Power Corporation ("NMPC")'s Power Plant to National Power Corporation ("NPC") in February 2006.

Interest income and others amounted to Baht 88 million, an increase of Baht 43 million or 95% as compared to 2005, mainly due to an increase of Conalûs other income from input VAT. Cost of Sales were Baht 153 million, a decrease of Baht 141 million or 48% due to the transfering of NMPCûs Power Plant.

Administrative expenses and income taxes were Baht 259 million, a decrease of Baht 369 million or 59%. This was due to the change to the proportionate consolidation method for the accounting of NTPC that led to a recognition of these expenses in the amount of Baht 31 million for 2006 whereas the expenses were recognised in the amount of Baht 101

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458 mil ion in 2005, mainly from development expenses of Baht 280 million. Conalûs income tax increased by Baht 74 mil ion, mainly owing to the adjustment of a deferred income tax incurred in 2005; whereas the transfering of NMPCûs Power Plant resulted in lower administrative expenses by Baht 14 million.

Interest expenses were Baht 72 million, up by Baht 3 million or 5%.

5) Other Business Group includes two subsidiaries, ESCO and ET. Total revenues were Baht 1,004 million, an increase

by Baht 335 million or 50% as compared to 2005 and total expenses totaled Baht 703 million, an increase of Baht 235 mil ion or 50%. The details are as follows: Total Revenues and Expenses of Other Business Group: ESCO 2006 2005 Revenues 804 497 Expenses 640 405

ET 2006 201 63

2005 172 63

2006 1,004 703

Unit : Mil ion Baht Total 2005 %Changes 669 50% 468 50%

Service income from ESCO amounted to Baht 788 million, up by Baht 301 million or 62%, resulting mostly from an increase of operation and maintenance (çO&Mé) services and selling spare parts to Elgali 2 Power Plant in Sudan.

Sales of water from a subsidiary, ET, were Baht 192 million, up by Baht 24 million, or 14%, thanks to an increase of minimum take and tariff under the long-term Water Purchase Agreement with Provincial Waterworks Authority.

Interest income and others amounted to Baht 23 million, an increase of Baht 9 million or 61%, mainly from ETûs interest income, up Baht 5 million and ESCOûs interest income, up Baht 4 million thanks to the higher interest rates.

ESCOûs interest in joint ventures totaled Baht 2 million, an increase of Baht 1 million, mainly from Amata Power-Esco Service Co., Ltd (çAMESCOé).

Cost of Services were Baht 547 million, an increase of Baht 212 million or 63%, resulting from an increase in the costs of ESCOûs O&M services to customers and spare parts which was consistent with its increased revenues.

Cost of water sales of ET was Baht 59 million, up Baht 4 million or 7% mainly from an increase of operating and maintenance service costs.

Administrative expenses and income taxes totaled Baht 95 million, an increase of Baht 22 million or 31% compared to 2005, mostly from ESCOûs higher administrative expenses and income taxes.

Interest expenses were Baht 3 million, a decrease of Baht 3 million or 54% compared to 2005, owing to lower principal amount of ETûs debt.

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4. Report and Analysis of Financial Position 4.1 Asset Analysis As at December 31, 2006, total assets of EGCO, its subsidiaries and joint ventures amounted to Baht 71,886 mil ion, an increase of Baht 10,636 million or 17% from December 31, 2005. The important details are as follows: 80,000

Unit : Million Baht 2005

71,886 2006

70,000 61,250 60,000 50,000 41,247 40,000

34,749 30,000 20,000 9,633 12,413

10,000

4,446 4,475

9,458 9,210

7,083 403

0 Total Assets

Cash,ST & LT ST & LT Investment Investment in Asso & JV Investment as Collateral

Property, Plant and Equip (net)

Others

1) Cash and deposits at financial institutions, and short term and long term marketable securities were Baht 9,633 mil ion or 13% of the total assets, down Baht 2,780 million or 22%. This resulted mainly from a decrease of cash and cash equivalent by Baht 2,972 million due to EGCO没s advance payment of Baht 2 billion to CLP Power (BLCP) Ltd, a subsidiary of CLP Holdings Limited, for the subscription of newly issued BLCP shares, along with REGCO没s prepayment of its remaining balance of US Institutional Loans totaling USD 78 million (equivalent to Baht 3,222 million). On the other hand, there was an increase of Baht 99 million in deposits at financial institutions and short-term marketable securities, and an increase of Baht 93 mil ion in long-term investments in marketable securities.

2) Short-term and long-term investments used as collateral were Baht 4,466 million or 6% of the total assets, down Baht 10 mil ion or 0.21%. This decrease was mainly because cash reserve is no longer required at REGCO after the payment of all its debt. Meanwhile, GEC incurred an increase in cash reserved for additional debt drawdown and debenture issuance.

3) Investment in associates and interests in joint ventures amounted to Baht 7,083 million or 10% of the total assets, up

by Baht 6,680 million. The increase was mainly from the recognition of investment in BLCP amounting to Baht 6,645 mil ion plus the recognition of the share of profit of AEP. Since most conditions precedent as specified in the BLCP没s Share Purchase Agreement were fulfilled in 2006 except 103

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for the legal transfer of shares and the formal receipt of the lendersû consent letter which occurred in January 2007, EGCO, therefore, concluded that the share purchase was completed within 2006. However, EGCO has not accounted for such interest by proportionate consolidation because EGCO will have effective joint control over BLCP in 2007.

4) Property, plant and equipment (net) totaled Baht 41,247 million or 57% of the total assets. They were up Baht 6,498 mil ion or 19% due to an increase in property, plant and equipment related to GEC (GPG and GYG), NTPC and APBPûs construction of Baht 7,520 million, Baht 1,140 million and Baht 180 million, respectively; as well as the recording of capital spare parts as property, plant and equipment following the major maintenance of REGCO, KEGCO and TLP Cogen in the amount of Baht 301 million, Baht 396 million and Baht 40 million, respectively.

Meanwhile, the decrease in property, plant and equipment was from the depreciation of EGCO and subsidiariesû assets totaling Baht 2,555 million and the reclassification of unutilised capital spare parts from property, plant and equipment to inventories of REGCO, KEGCO and TLP Cogen amounting to Baht 211 million, Baht 207 million and Baht 35 million, respectively.

5) Other assets were Baht 9,458 million or 13% of the total assets, up Baht 248 million or 3% mainly from an increase of other current assets by Baht 167 million, other non-current assets by Baht 166 million, trade receivable from a related party (EGAT) by Baht 117 million; whilst spare parts and supplies dropped by Baht 171 million.

4.2 Liability Analysis As at December 31, 2006, the EGCO Groupûs total liabilities were Baht 35,302 million, up Baht 6,166 mil ion or 21% as a result of recording the connected transaction for the acquisition of shares in BLCP as amounts due to related parties of Baht 4,645 million. The increase came also from additional loan drawdown and debenture issuance. The total liabilities consist of the following: 1) Long-term loans and debentures totaled Baht 25,245 million, or 72% of total liabilities, up Baht 1,760 mil ion or 7%.

USD The details are as follows: THB 43% - USD loans in the amount of USD 306 million Debenture - Yen loans in the amount of Yen 970 million 25% - Filipino Peso loans in the amount of Peso 52 million JPY THB - Baht loans in the amount of Baht 8,018 million PHP 1% 31% 0.15% - Baht debentures in the amount of Baht 6,337 million In 2006, there was additional loan drawdown that totaled Baht 10,859 million for the construction at GEC, NTPC and APBP in the amount of Baht 9,208 million, Baht 1,523 million and Baht 128 million, respectively. On the other hand, there was loan principal repayment of Baht 9,434 million: from REGCO - Baht 4,048 million which included prepayment of its US Institutional Loans for the remaining balance; KEGCO- Baht 1,304 million; TLP Cogen - Baht 149 million; ET - Baht 60 mil ion; Roi-Et Green - Baht 34 million; Conal - Baht 223 million; APBP - Baht 33 million; and GEC - Baht 3,583 million. Based on EGCOûs equity ownership of 50% in GEC, EGCOûs proportion of 50% in GCCûs issuance of Baht debenture to refinance GCC, NKCC and SCCûs long-term debt facilities in April 2006 amounted to Baht 2,900 million. And REGCO, KEGCO and GECûs debenture repayments were Baht 735 million, Baht 583 million and Baht 145 million, respectively.

Maturity of long-tern loans and debentures as of December 31, 2006 Unit : Mil ion Baht KEGCO TLP Cogen Roi-Et Green APBP GEC Conal NTPC Within 1 Year 2,012 150 29 41 350 189 1-5 Years 3,637 765 122 209 5,149 369 389 > 5 Years 655 142 166 8,536 2,336 Total 5,649 1,570 294 416 14,035 558 2,724 Long-term loans and debentures are secured liabilities over land, buildings, power plants and equipment of subsidiaries and joint ventures. The subsidiaries and joint ventures have to maintain cash reserves for the purpose of repayment of principal and interest due within one year and as a reserve for minimising the foreign exchange risk.

2) Other liabilities amounted to Baht 10,056 million or 28% of total liabilities, represented an increase of Baht 4,406 104

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mil ion which mostly resulted from an increase of amounts due to related parties totaling Baht 5,019 million. This reflected a recording of the connected transaction for the acquisition of shares in BLCP as amounts due to a related party, CLP Power (BLCP) Ltd., of Baht 4,645 million, which was paid to CLP Power (BLCP) Ltd. and share transfer completed on January 30, 2007. The other non-current liabilities increased by Baht 816 million, trade payables increased by Baht 283 million and income tax payable up Baht 354 million; whereas GECûs contruction payable decreased by Baht 1,932 million.

4.3 Shareholdersû Equity Analysis As at December 31,2006, Shareholdersû Equity amounted to Baht 36,585 million, which was Baht 4,470 mil ion or 14% higher than the amount as at December 31, 2005. This was due mainly to the following reasons: - Net profits from 2006 operation amounted to Baht 6,036 million.

- The resolution of the Shareholdersû Annual General Meeting No.1/2006 held on April 24, 2006 approved the dividend payment for the second half of the year 2005 to be 1.75 Baht per share, totaling Baht 921 million. The date of dividend payment was May 10, 2006.

- The Board of Directors at the meeting on August 28, 2006 approved the payment of interim dividend at Baht 2.00 per share with the dividend payment date on September 26, 2006, totaling Baht 1,053 million.

The analysis of the companyûs capital structure as at December 31, 2006 is summarized as follows: Shareholdersû equity was Baht 36,585 million or 50.89%.

Debt Equi t y 49.11% Liabilities were Baht 35,302 million or 49.11%.

50.89% Important financial ratios were as follows: - Debt to equity ratio was 0.96 times, higher than 0.91 times at the end of 2005.

- Book value per share was Baht 67.26, higher than Baht 58.96 at the end of 2005.

5. Report and Analysis of Cash Flow Position Cash Flow Statement shows the change in cash flows from operating activities, investing activities, and financing activities at the end of the accounting period, and indicates the ending balance of the cash and the cash equivalents.

As at December 31,2006, the ending balance of the cash and the cash equivalent was Baht 5,849 million, down Baht 2,972 mil ion from the end of 2005. This decrease was a result of a decrease of cash in hand and deposits at financial institutions of Baht 3,112 million and the effect of foreign exchange rate changes of Baht 141 million. The details of the sources and uses of funds are as follows: - Net cash received from operating activities totaled Baht 8,298 million. Most of this was cash from operating activities that amounted to Baht 8,280 million and cash from working capital of Baht 18 million.

- Net cash payment for investing activities was Baht 12,066 million. There was cash payment for the investment in power plant construction that amounted to Baht 8,121 million at GEC, Baht 1,739 million at NTPC and Baht 178 mil ion at APBP. The cash inflow was from dividends of KTSF, EASTW and the other open-ended funds which amounted to Baht 130 mil ion, Baht 31 million and Baht 8 million, respectively.

- Net cash received from financing activities was Baht 655 million, mainly owing to the loan repayment by REGCO, KEGCO, TLP Cogen, Roi-Et Green, ET, APBP, GEC and Conal totaling Baht 9,434 million, including the prepayment by REGCO of all its outstanding US Institutional Loans. The repayment of debentures by REGCO, KEGCO and GEC amountied to Baht 1,464 million and the payment of dividends by EGCO to shareholders was Baht 2,150 million. On the other hand, there was additional loan drawdown by GEC in the amount of Baht 9,208 million, NTPC in the amount of Baht 1,523 mil ion and APBP in the amount of Baht 128 million, plus GCCûs debenture issuance of Baht 2,900 million.

In 2006, the analysis of the Companyûs liquidity ratios is as follows: - Current ratio was 1.69 times, lower than 2.27 times for 2005 - Quick ratio was 1.27 times, lower than 1.79 times for 2005 Both liquidity ratios were lower compared to 2005, mostly as a result of the recording of the connected transaction for the acquisition of shares in BLCP as amounts due to a related party, CLP Power (BLCP) Ltd., of Baht 4,645 mil ion, which was paid to CLP Power (BLCP) Ltd. in 2007. The fall in the ratios was partially offset by a decrease in the long-term loans maturing within one year that resulted from REGCOûs prepayment of its outstanding US Institutional Loans.

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Risk Factors

To create long term shareholders' value, EGCO recognizes the importance of properly analyzing and managing its business risks. The Board of Directors then set the risk management policy which was published in the Risk Management Manual to promote understanding among the Group employees and to ensure the uniform risk management of the Group. Such policy requires that each subsidiary continuously manages their risks as well as set up the early warning systems. For new investment projects, risk analysis and associated mitigation measures are required to be submitted to responsible committee for consideration.

In 2006, the Board of Directors reviewed the risk management policy and entrusted the Audit Committee to oversee and monitor the Company's risk management performance. Risk Management Committees at Management level have also been established at EGCO and its subsidiaries.

A summary of key risk factors and associated mitigation measures is as follows:

1. Investment Risk 1.1 Investment in New Projects Since there was more clarity about EGCO's eligibility to participate in the upcoming Independent Power Producer (IPP) bidding, EGCO analyzed risk factors relating to the new bidding as follows: Strong Competition: In order to be well prepared for the upcoming bidding, EGCO conducted the study on the project feasibility and return. The engineering design, construction sites, water and fuel resources, competent staff as well as competitive financial costs were also prepared for the bidding.

Community Acceptance: To mitigate the risk that the community might not welcome the new projects, the Company performed the Environmental Impact Assessment (EIA) and analyzed the actual community needs to set proactive measures to reduce community dissatisfaction and impacts on the environment.

1.2 Project Construction Delay and Cost Overrun The assets under construction were Nam Theun 2 and Khang Khoi 2 projects, which were awarded the longterm EGAT Power Purchase Agreement (PPA) with fixed scheduled commercial operation dates (SCOD). Failure to meet the SCODs would result in the penalty payment to EGAT. In addition, there might be cost overrun which would affect the return on investment. The Company then set the following measures to mitigate those risks.

Endeavor to ensure that the contracts have clear and definite conditions and pricing and that the selection process was well established to ensure that qualified and experienced contractors are engaged; Assign responsible unit to follow up construction progress, and to attend the project meetings to share comments and provide instructions; and Present regular reports on the project progress against the budget to the Management and the Board of Directors.

1.3 Failure to Meet Targeted Return on Investment With the responsibility to ensure that our investment would generate the expected return, EGCO set up the measures to mitigate the risks that would lead to the failure to meet the targeted return on investment as follows:

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Set up the Asset Management Policy and assign EGCO senior management to be directors or management in subsidiaries and new investment projects; Establish Asset Management and Planning Group to monitor operating performances and to analyze the actual return on investment against the preset targets of the invested companies.

1.4 Regulatory and Policy Change There was an exposure that Government's new or changing regulations and policies would affect our business plan. To mitigate this risk, the responsible unit was assigned to monitor relating rules, regulations and policies, and analyze possible impacts on the Company as well as to seek outside professional advices in order that EGCO could respond to new regulations and policies appropriately.

1.5 Country Risks The Company has invested in the electricity companies in the Philippines and the Lao PDR. Being aware of the impact from the country risks, EGCO assigned responsible unit to monitor political and economic circumstances in the invested countries. The progress report was made on a regular basis.

2. Operational Risks 2.1 Plant Efficiency There were various efficiency benchmarks under the EGAT PPA which EGCO's power plants had to meet such as Equivalent Availability Factor (EAF) and Heat Rates. Since failure to meet these benchmark requirements would result in penalties, the management set up systematic procedures to ensure that these targets for operational efficiency were met which included the followings.

Inclusion of key plant parameters in the Corporate Key Performance Indicators of power plants in the EGCO group; Establishment of Early Warning System for significant information relating to electricity generating process; Ensuring that the scheduled preventive maintenance of power plant equipments are carried out on a regular and professional basis; Implementing the Quality Management System (ISO: 9001:2000) to ensure that those power plants operate continually and efficiently.

2.2 Safety, Health and Environment The Company realized that the electricity generating process might affect the safety and life quality of the employees and neighboring communities. Consequently, the Company took following risk mitigation measures: Operate and manage in accordance with the Safety, Health and Environment (SHE) Management Manual of EGCO group companies; Procure insurance policies against All Risks, Machinery Breakdown, Business Interruption and Third Party Liability to ensure sufficient coverage in the case of unexpected events; Maintain the Environment Management System (ISO: 14001) and Thai Industrial Standards for the Occupational Health and Safety Management (TIS: 18001 & OHSAS: 18001) to ensure that the operations, waste disposal and related work processes are efficient and acceptable from a safety, health, and environment standpoint.

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2.3 Dependence on Sole Major Customer The revenue from electricity generation to EGAT under the long term PPA accounted for 89 % of the total revenue in 2006. Normally, dependence on only one major customer might put the Company's revenue at risk.

However, EGAT's mission was to stabilize the national supply system. In addition, it had good reputation and strong financial status. Therefore, EGCO's risk in this area was considered low.

2.4 Non-Compliance with Power Purchase Agreement of Small Power Producers (SPPs) The SPP PPA between EGAT and EGCO's subsidiaries required that the SPPs sell steam to the industrial users with the thermal energy not less than 10% of the total energy output. Failure to achieve this would result in the penalty payment to EGAT. Even though the financial impact on EGCO would be little, the management has set up a working team to study and analyze this matter to solve the problem.

2.5 Raw Water Shortage Without adequate raw water, power plants could not be run resulting in the revenue loss and penalty payment. To mitigate this risk, EGCO Groups' power plants has developed the countermeasures by increasing raw water storage capacity, seeking additional sources and setting measures to optimize raw water usage in order to maintain sufficient water for continuous production process.

2.6 Fuel Shortage Gas fired power plants in EGCO Group had long term Fuel Supply Agreements with PTT. For REGCO and KEGCO, natural gas has been supplied by EGAT under the PPA. Therefore, the risk of fuel shortage for gas fired power plant was low.

Biomass power plants which used rice husk and parawood as fuel might expose to the risk of volatile pricing and supply as long term fuel supply agreements could not be secured. The primary risk prevention measures then are to reserve more fuel and to identify more suppliers in the power plant's radius.

3. Financial Risks 3.1 Foreign Exchange Rate Fluctuation EGCO Group had a policy to mitigate currency mismatches for each investment projects to prudent levels.

In general, this was achieved by matching currencies of project development and construction costs with funding source currencies and subsequently matching the currency of long-term funding profiles with those of each project's revenue stream during the operation phase.

3.2 Interest Rate Fluctuations EGCO Group has a policy to manage interest rate risks by fixing the floating interest rate to the maximum extent commercial y possible to provide the most predictable cash flow from its long-term power purchase contracts. If interest rate fixtures were not available for the full project terms required, EGCO would seek to enter into or cause its project company's to enter into financial instruments that could best mitigate the interest rate risks subject to market availability and cost.

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3.3 Contingent Liabilities In certain cases, EGCO provides credit support for loans granted or other forms of credit granted to project development subsidiaries to reduce project cost for limited periods of time. For such cases, EGCO set procedures to minimize risks associated with such credit support as follows: An analytical assessment of each such obligation is performed and reported on a regular basis; Obligation risks are categorized into low likelihood and high likelihood. 10% of contingent liabilities had been set aside as reserve fund for high obligation risks.

3.4 Non-Compliance with Financial Covenants According to the covenants with financial institutions, EGCO had to maintain acceptable level of Debt to Equity Ratio, Debt-Service Coverage Ratio, and Tangible Net Worth. Failure to maintain such covenants would lead to lenders' decline for further drawdown or request for early repayment. By the same token, EGCO might be forced to return the standby L/C to the issued bank before its due date.

However, the ability to maintain the above financial covenants depended on EGCO Group's performance including ability to acquire quality projects and efficiency in running power plants while maintaining financial disciplines.

This would make EGCO Group's financial performance, cash flow and financial ratios as sound as expected.

4. Other risks 4.1 Competent Personnel Shortage The growth in power business did not result only in the high competition in the business but also intensified competition in the labor market. Being aware of the risk of losing high performers and therefore set the risk mitigation measures as follows.

Establishing manpower plan for EGCO Group companies, for both existing power plants and new projects; Setting Human Resource Development Plan for each management level; Establishing development plan to continuously increase personne's technical knowledge, expertise, and skills in power plant operation

4.2 Information Technology The power plant management and new business development required the strong support from information technology. Being aware of the risk of information technology system failure and other new threats, EGCO set the countermeasures as follows.

Appropriate implementation and maintenance of IT security system with regular monitoring schedule; Establishment and testing of Disaster Recovery Plan to assure that the system would be implemented to recover the situation as soon as possible and with the least adverse impact to EGCO.

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Related Transactions

Group Companies with Electricity Generating Authority of Thailand In conducting the business, there are related transactions in terms of the power purchase and the maintenance services between the Group companies and Electricity Generating Authority of Thailand (çEGATé), which holds 25.41 % stake in EGCO. However, such transactions were based on the agreed prices in the contracts and were disclosed in accordance with the rules set by the Securities & Exchange Commission (çSECé) and Stock Exchange of Thailand (çSETé). The summary of the related transactions in 2006 were as follows.

1. Person who may have conflict of interests Persons with potential conflict of interest

EGAT

Positions EGCO

Mr. Pornchai Rujiprapa

Chairman

Chairman

Mr. Norkun Sitthiphong

Chairman

Chairman

Mr. Sanit Rangnoi

Director

Director

Mr. Chamnong Wongsawang Deputy GovernorDirector Transmission System Deputy GovernorMr. Sombat Sarntijaree Director Generation President-Development Director Mr. Kitti Sirikwin

Mr. Sahai Rakyao

Business SEVP-Fuel

Director

Mr. Visit Akaravinak

Engineer level 14

President

Note EGCO Subsidiaries -

Appointed on November 27, 2006 Resigned on October 31, 2006 Appointed on November 27, 2006 Appointed on November 27, 2006 Appointed on November 27, 2006 Director of REGCO, Resigned on October 7, 2006 KEGCO and ESCO Resigned on October 7, 2006 Chairman of REGCO, Appointed on KEGCO and ESCO August 1, 2005

2. Details of the transactions 2.1 Power Purchase The following Group companies sell electricity to EGAT under the Power Purchase Agreement (PPA).

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Group companies 1. Rayong Electricity Generating Co. Ltd. (çREGCOé) 2. Khanom Electricity Generating Co., Ltd. (çKEGCOé) 3. Gulf Cogeneration Co., Ltd. (çGCCé) 4. Samutprakarn Cogeneration Co., Ltd. (çSCCé) 5. Nong Khae Cogeneration Company Limited (çNKCCé) 6. Amata-EGCO Power Limited (çAEPé) 7. Amata Power (Bang Pakong) Limited (çAPBPé) 8. TLP Cogeneration Company Limited (çTLP Cogené) 9. Roi-Et Green Company Limited (çRoi-Et Greené) 10. Gulf Yala Green Company Limited (çGYGé)

Effective Date

Term(yrs)

Notes

Dec 7, 1994

20

Jun 19, 1996

15 and 20

Sep 3, 1998 Aug 23, 1999

21 21

First amendment to PPA was signed on Jan 30, 1998 First amendment to PPA was signed on Jan 30. 1998 -

Oct 12, 2000

21

-

Sep 17, 1998

21

-

Sep 28, 2001

21

-

Jan 28, 2003

21

-

May 29, 2003

21

-

Nov 28, 2006

25

-

The connected transactions of REGCO and KEGCO with EGAT are in accordance with the agreed price as determined in the PPA, which have been reviewed by National Energy Policy Council and approved by the cabinet.

The tariff rate of GCC, SCC, NKCC, AEP, APBP, TLP COGEN and Roi Et Green is the rate that EGAT applied to all SPPs. They also have to pledge bank guarantees as collateral against the premature termination of the PPAs which would be released at the contract expiry.

2.2 Maintenance Services 2.2.1 REGCO and KEGCO extended the Major Maintenance Agreement (MMA) with EGAT for the latter to provide major maintenance services, repair services, administrative services, and additional services related to their power plants for another 6 years with the execution date on December 7, 2006 and June 19, 2002, respectively. The electricity revenues from such agreements are calculated on a çcost plus basisé with the escalation in accordance with the consumer price index.

2.2.2 EGCO Engineering and Services Co., Ltd. (çESCOé), an O&M service provider, engaged EGAT to provide the O&M services, inventory management and training to the power plants of National Electricity Cooperation Republic of Sudan, for two years starting form May 1, 2006 and was extended for another year.

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ESCO, an O&M service provider entered into Maintenance Agreement with EGAT to provide major and service maintenance work including other administrative and relating services to the power plants. The compensation for such services is calculated on a çcost plus basisé. The agreement is effective for a period of six years commencing from January 26, 2001 to July 26, 2002.

The above transactions are considered the transactions to support the normal business using the general trading terms and conditions of which the agreed price could be calculated from the assets or the referenced price and follow the rules of the SET. Transactions Value (based on the Companyûs shareholding in those companies) as of December 31, 2006: Unit : Million baht GCC, Roi-Et Transactions ESCO REGCO KEGCO TLP COGEN SCC, APBP Green NKCC Transaction Value 1. Power Sales 2. Service Providing 3. Maintenance Services

5,392.26 97.97

5,272.88 360.19

1,128.37 -

2,458.74 2.58

202.09 -

232.54 -

62.97 41.17

Outstanding Amount 1. Account Receivable 2. Trade Payable

937.80 25.01

662.31 69.37

202.77 -

443.78 13.69

33.92 -

36.70 -

48.62 5.89

EGCO and CLP Holdings Limited CLP Holdings Limited holds 11.21% stake in EGCO through CLP Power Projects (Thailand) Limited and CLP Power Projects (Thailand).

1. Person who may have conflict of interests During the consideration of the connected transaction, CLP Power Projects (Thailand) has three representative directors in the Company, namely, Mr. Richard McIndoe Mr. Peter Littlewood Mr. Hideaki Tomiku

2. Details of the transactions The Company acquired the 57.422 million ordinary shares of BLCP Power Company Limited from CLP Power (BLCP) Limited (çCLP-BLCPé), a company under the CLP Holdings Limited Group, and 2 individual shareholders, namely Mr. James Richarde Truscott and Mr. Mark Takahashi (collectively called çthe CLP Groupé). In valuating the acquisition price, the Company engaged TURNAROUND Co., Ltd., as the financial advisor and Kim Eng Securities (Thailand) Public Company Limited as an independent financial advisor. Both of them were approved by the SEC. The Board of Directors and the Audit Committee endorsed that the Company should enter into this transaction viewing this investment was considered a strategic fit in terms of meeting the Companyûs vision and policy to be a leader in the

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Thai electricity industry. This transaction would enhance the Companyûs capacity in operating and maintaining coal fired power plant, increase the Companyûs market shares, and broaden the Companyûs capacity for new business opportunities that would arise through Thailandûs growing demand for electricity. In addition, BLCP would generate immediate income to the Company. The methodologies to determine the appropriate transaction value were generally acceptable and would not result in undue benefits to CLP Group. When making the Board of Directorsû resolution, directors who had the potential conflict of interest, namely Mr. Richard McIndoe, Mr. Peter Albert Littlewood and Mr. Hideaki Tomiku did not either attend the meeting or exercise their judgment.

Since the transaction size is 32.27% of EGCO and its subsidiariesû net tangible assets as calculated based on the reviewed EGCOûs consolidated financial statements as at June 30, 2006, EGCO held a shareholder meeting to pass a resolution to approve the acquisition transaction on December 1, 2006 to comply with the SETûs Notification Re: Disclosure of Information and Other Acts of Listed Companies Concerning the Connected Transactions. CLP Power Projects (Thailand) Limited, which held 118.02 million of the EGCOûs shares, representing 22.42% of EGCOûs total paidup capital, did not have the voting right. The number of the votes in favor for this transaction was 94.7% which exceeded the requirement of three-fourths of the total shares attending EGCOûs Extraordinary General Meeting and having the rights to vote.

EGCO and Subsidiaries 1. Person who may have conflict of interests EGCO has entered into the transaction with the subsidiaries and joint ventures of which the list of persons who may have conflict of interests is as follows.

Company

Shareholding (%)

Relationship

REGCO

100

Following EGCO Management were appointed directors and Management of REGCO: 1. Mr. Visit Akaravinak, Chairman 2. Mr. Sakda Sreesangkom, Director 3. Mr. Chankij Jearaphunt, Director 4. Mr. Rasda Pongpaew, Director 5. Mr. Sinchai Nerngchamnong, Managing Director 6. Mr. Chumsak Desudjit, Deputy MD-Operation 7. Ms. Chutiporn Prayong, Deputy MD-Finance & Administration

KEGCO

100

Following EGCO Management were appointed Directors and Management of KEGCO: 1. Mr. Visit Akaravinak, Chairman 2. Mr. Sakda Sreesangkom, Director 3. Mr. Sinchai Nerngchamnong, Director 4. Mr. Rasda Pongpaew, Director 5. Mr. Chankij Jearaphunt, Managing Director 6. Mr. Mana Vitavasakul, Deputy MD-Operation 7. Ms. Ngamphis Chitphromphan, Deputy MD-Finance & Administration 113

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Company

Shareholding (%)

Relationship

ESCO

100

TLP Cogen

80

Roi-ET Green

70.3

GEC

50

NTPC

25

AEP

14.85

Following EGCO Management were appointed Directors and Management of ESCO: 1. Mr. Visit Akaravinak, Chairman 2. Mr. Sakda Sreesangkom, Director 3. Mr. Sinchai Nerngchamnong, Director 4. Mr. Chankij Jearaphunt, Director 5. Mr. Rasda Pongpaew, Managing Director 6. Mr. Wajarapong Palakawong Na Ayudhya, Deputy MD-Operation 7. Ms. Warunee Tantiwong, Deputy MD-Finance & Administration Following EGCO Management were appointed Directors and Management of TLP COGEN: 1. Mr. Chumsak Desudjit, Chairman 2. Mr. Voravit Potisuk, Director 3. Mr. Piya Jetasanon, Director 4. Mr. Supoth Chuntvilartkul, Director and General Manager Representative Directors in the Board of Directors and Management are as follows.

1. Mr. Chankij Jearaphunt, Chairman 2. Mr. Somyos Polachan, Director 3. Mr. Pornsak Pornchanadham, Director and General Manager Representative Directors are as follows.

1. Mr. Visit Akaravinak 2. Mr. John M. Palumbo 3. Mr. Sakda Sreesangkom 4. Mr. Sakul Pochanart 5. Mr. Chalermchai Ratnarak Representative Directors are as follows.

1. Mr. Sakul Pochanart 2. Mr. Niwat Adirek Representative Directors are as follows.

1. Mr. Sakda Sreesangkom 2. Mr. Gumpanart Bumroonggit

2. Financial Support EGCO provides the financial support to subsidiaries and joint ventures in accordance with their shareholding in that company which applied a general trading terms and were considered normal business transactions to optimize the shareholders没 return. Such transactions were also approved by the Board in accordance with the Table of Authority and disclosed in the notes to financial statements as at December 31, 2006.

2.1 Inter-company Loan REGCO On 26 December 2006, EGCO entered into an agreement to provide loan to REGCO in the amount of 2,600 mil ion baht.

Principal and interest payment is scheduled semi-annually on June 7, and December 7, commencing June 2007 to December 2009. The interest rate is fixed at 6% per annum.

ESCO On 22 November 2006, EGCO entered into an agreement to provide loan to ESCO in the amount of 780 mil ion baht.

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Principal and interest payment of 45,882,350 baht is scheduled annually commencing December 2009 to December 2025.

The interest rate is MLR minus a certain margin and payable on a semi-annual basis.

GEC EGCO entered into a Credit Facility Agreement with GEC on February 24, 2004 to provide a term loan in the amount of 450 million baht of which the proceeds were used to refinance GEC没s long-term loan with a local commercial bank. The repayment terms and conditions under such Credit Facility Agreement are the same as the original loan.

2.2 Contingent Liabilities 2.2.1 Loan Guarantee The Company provided the loan guarantee to subsidiary, joint venture and associated companies under the Sponsor Support on Loan Agreement with significant information as follows.

TLP COGEN As of December 31, 2006, TLP COGEN没s sponsors had a commitment to provide the loan guarantee covering the outstanding loan and interest payment in the amount not exceeding 200 million baht.

Hence, EGCO has the commitment to provide the loan guarantee at not exceeding 160 million baht which accounted for 80% of the outstanding loan in accordance with its holding in the company.

Roi-Et Green EGCO had a commitment to provide the loan guarantee in the amount not exceeding the total outstanding loan and interest payment. As at December 31, 2005, the total commitment amounted to 976.82 million yen or equivalent to 298.70 million baht.

AEP EGCO had the loan guarantee commitment to AEP at 30% of the guarantee amount for the following cases.

Guarantee for the take-or-pay support in the Fuel Gas Supply Agreement with PTT, Decreasing of gas pressure supplied by PTT. As at December 31, 2006, the Company没s commitment was approximately US 1.38 million dollars or equivalent to 50.00 million baht. Such commitment will decline over the loan life of 14 years starting from the contract execution date on February 10, 1997.

2.2.2 Letter of Guarantee EGCO had the commitment to the banks which issued the letter of guarantee or the standby letter of credit to the subsidiaries and joint ventures as detailed below.

KEGCO EGCO requested HSBC to issue the SBLC to guarantee the release of cash in the KEGCO没s US dollar and baht Debt Service Reserve Accounts. As at December 31, 200, the value of the SBLC was US 13.52 million dollars (equivalent to 489.83 million baht) and 692.74 million baht, respectively.

GEC EGCO provided guarantee to a syndicate of financial institutions that issued the SBLC with the face value of 185 million US dollars for the KK II project. As at December 31, 2005, EGCO is responsible for 92.50 mil ion US dollars (equivalent to 3,838.65 mil ion baht) in accordance with its 50% shareholding in GEC. Necessity and Rationale of Related Transactions The above related transactions are deemed appropriate as they are normal business and business supporting transactions of which the general trading terms and conditions are applied. In addition, the 115

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transaction pricing could be calculated from the assets or the referenced price which complied with the rules of the SET. All transactions were approved by the authorized person in accordance with the Companyûs Table of Authority and disclosed in the Notes to 2006 Financial Statements item 29 and 30. The Audit Committee had reviewed the transactions before proposing to the Board and deemed that they adopted the general trading terms and conditions and were normal business transactions of power business.

Procedure to Approve the Related Transactions The Company lives by the following policies and guidelines in treating and approving the related transactions.

In case of entering into any contracts or any related transactions between the Company, the subsidiaries, joint venture companies, associated companies and/or outside parties, the Company will consider the necessity and appropriateness of such transactions taking into account the best interest of the Company. Transaction prices are charged based on the fair market value like other outside parties.

Related transactions that are considered the connected transactions in accordance with the rules of the SET, will be treated following the SETûs and SECûs requirements and must be reviewed by the Audit Committee.

The financial support provided to subsidiaries and joint ventures such as loan for working capital of those companies must be charged with fair return such as using the market interest rate.

Directors with potential conflict of interest will not be allowed to vote or attend the meeting.

The principles are set in the Code of Conduct that management and employees including their related persons are prohibited from using inside information for their own or othersû benefits.

In case that the normal business transaction or the supporting normal business transaction which are under the authority of the Management, it wil use the price and conditions like the transaction with the outsider. If there is no such price, the company wil consider by comparing the goods price and service rate with outsider under the same condition or almost the same condition. The company may use the report of independent appraiser which is engaged by the company to compare the price for the major transaction to ensure that such price is reasonable to maximize the companyûs benefits by delegating the authority according to the amount of payment. In case the Management who including in the conflict of interest in such issue, he or she must not have the authority for approval.

Financial assistance or guarantor of group companies or connected person wil conduct prudently for the most benefits of the group company with the compensation for each transaction such as interest rate, guarantee fee at the market rate at the transaction date.

In a case of a connected transaction which has to seek the approval from the shareholdersû meeting with a vote of not less than three-fourths of the total votes of shareholders attending the meeting and having voting right, the major shareholder who is the connected person can attend the meeting in order to count as the quorum but such connected person cannot have a voting right. The total of voting rights to approve the connected transaction wil exclude the interested shareholdersû equity. Therefore, such rule wil not effect to the quorum and the number of the voting rights.

Guidelines for Treating Future Related Transactions The Company wil seek to ensure that all the future related transactions are normal business transactions without the siphoning of profit between the Company and subsidiaries with potential conflict of interest parties. The Company wil assign the Audit Committee, the auditor or independent consultants to review and recommend the appropriateness of the pricing and the justification of those transactions and wil disclose the types, value and the reasons for entering into those transactions to the shareholders in adherence with the rules of the SET and SEC. The Company also wil promote continuous understanding on the related transaction such as providing the update of the new rules and regulations including the written practices in dealing with related transactions to ensure transparency and the benefit of the shareholders.

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Statement of Directorsû Responsibilities According to the Public Limited Companies Act B.E. 2535, the Accounting Act B.E. 2543, the Securities and Exchange Act B.E. 2535, and the Notification of the Securities and Exchange Commission re: çDisclosure of Financial Statements and Performance of Listed Companiesé, the Board of Directors is responsible to prepare the true and fair financial statements of the Company.

The Board of Directors has also issued the Companyûs regulation on accounting, finance and budgeting B.E. 2544 to which the Management must adhere. In addition, the Audit Committee has been appointed to confirm that the Companyûs financial statements have been prepared in a justified and prudent manner in compliance with such rules and regulations. The appropriate accounting policies were consistently applied. Also, the Audit Committee has reviewed the Companyûs internal control systems to ensure its adequacy and effectiveness as a means to safeguard the companyûs assets from unauthorized persons and reveal the weakness to prevent unlawful conduct and abnormalities.

Management has prepared both consolidated and Company financial statements for the year ended 31 December 2006 in compliance with the Generally Accepted Accounting Principles under the Federation of Accounting Professions under the Royal Patronage. The appropriate accounting policies were consistently applied and the financial statements were prepared in a prudent and justified manner with adequate disclosure of significant information in the notes of the financial statements.

The Board of Directors is of the opinion that both the consolidated and company financial statements for the year 2006, present the companyûs financial position, operating results and cash flows in a correct and reliable manner and that such statements are in compliance with the Generally Accepted Accounting Principles and all governing rules and regulations.

Dr. Pornchai Rujiprapa Chairman

117

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Audit Committeeûs Report

The Audit Committee of the Electricity Generating Public Company Limited (the Company), appointed by the Board of Directors, is composed of three independent directors whose qualifications are in compliance with those specified by the Stock Exchange of Thailand (çSETé). The compositions, qualifications, term of office, and responsibilities of the Audit Committee are specificed in the Audit Committee Charter and approved by the Board. At the end of 2006, the Chairman of the Audit Committee was Mr. Chaipat Sahasakul, and the other two members were Mr. Chareon Prajumtan and Ms. Wattanee Phanachet.

During 2006, the Audit Committee saw some changes among its members; Mr. Charu-Udom Ruangsuvan vacated his office due to the expiration of his term, and Mr. Worawit Khamkanist rotated to become a member of the Nomination and Remuneration Committee. The Audit Committee held 20 meetings in 2006 with a 100% attendance rate.

The summary of major activities is as follows: Review the 2006 quarterly financial statements and the annual financial statements with both the external auditor and the Management. This was accomplished by asking questions and providing comments and useful recommendations to ensure that the process to prepare the financial statements and major disclosures were complete, accurate, reliable, in compliance with related laws and regulations, and in accordance with the generally accepted accounting principles which were consistently applied.

Review the sufficiency and effectiveness of the internal control systems. The Committee considered the internal auditorûs and the external auditorûs reports, the results of the internal control evaluation of EGCO and its subsidiaries together with the internal control questionnaires which were prepared in compliance with the Committee of Sponsoring Organizations of the Treadway Commission (çCOSOé)ûs guidelines. The Internal Audit Division was also requested to perform a management control audit to ensure that the Company has sufficient and appropriate procedures and practices in place to prevent and mitigate risks that might occur. Also reviewed was the transaction approval authority (and the levels thereof) to ensure compliance with policy.

Review and acknowledge the Code of Conduct Compliance Statement and General Representation Letter prepared by the President as well as to review the statementsû preparation process which provided assurances to the Committee that the Companyûs operations were in compliance with the internal control systems and that the financial information and disclosures were accurate, complete and reliable.

Approve the audit plan, the scope of work, the budget and the manpower of the Internal Audit Division. The Committee also conducted the performance appraisal of the internal audit manager who functionally reported to the Committee.

Review with Management the Companyûs compliance procedure to ensure that the Management and operations complied with the securities and exchange laws and regulations of the SET or laws relating to the business of the Company.

Review and select the external auditor and determine their remuneration for the year 2007 by considering the compliance of the selection procedure with the guidelines approved by the Committee, taking into account the qualifications of the audit firm and the auditors. In order to increase assurance that the auditor was independent, the Committee formulated a policy in conformity with the Securities and Exchange Commission (çSECé)ûs notification to rotate the Companyûs auditors every five years.

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Consider other services performed by the audit firmûs group companies for EGCO and its subsidiaries during 2006. It was determined that the scope of work and fees for other services were not significant in that they would influence the independence of the auditor.

Hold exclusive meeting with the external auditors to ensure their independence.

Review with Management and the Independent Financial Advisor the acquisition of shares in BLCP Power Limited which was a çconnected transactioné. The Committee considered this transaction carefully for the optimum benefit to the Company and the shareholders. The acquisition price was appropriate and there were no privileges provided to CLP Group.

Review the Management Discussion and Analysis (MD&A) with Management to ensure its accuracy, adequacy and usefulness to shareholders and investors for their investment-making decisions.

Review the Audit Committee Charter to ensure that the duties entrusted to them in 2006 were achieved and complied with international practices and those specified by the SETûs Audit Committee Best Practice Guidelines, while also being appropriate for the Companyûs business.

The Committee is of the opinion that the Companyûs 2006 internal control and management control systems are adequate and appropriate. All procedures were followed to ensure that the Company has conducted its business consistent with related laws and that information disclosure in the financial statements is accurate, complete and reliable.

The Committee reviewed the auditorsû performance in the past year as well as the audit fee and recommended to the Board of Directors that PricewaterhouseCoopers ABAS Ltd., Mr. Suchart Luengsuraswat Certified Public Accountant (Thailand) No. 2807, Ms. Nataporn Pan-udom Certified Public Accountant (Thailand) No. 3430 and Mr.Kajornkiat Aroonpairotekul Certified Public Accountant (Thailand) No. 3445, be re-appointed by the shareholders as the Companyûs auditors for 2007 due to their professional practices, knowledge of business, fairness, independence and always discharging their duties on time.

Mr. Chaipat Sahasakul Chairman of the Audit Committee

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Auditor没s Report

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Electricity Generating Public Company Limited

Balance Sheets

As at 31 December 2006 and 2005

For Director The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

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Electricity Generating Public Company Limited

Balance Sheets

As at 31 December 2006 and 2005

The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

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Electricity Generating Public Company Limited

Balance Sheets

As at 31 December 2006 and 2005

The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

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Electricity Generating Public Company Limited

Statements of Income

For the years ended 31 December 2006 and 2005

The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

125

126

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The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

For the years ended 31 December 2006 and 2005

Statements of Changes in Shareholder没s Equity

Electricity Generating Public Company Limited

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The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

For the years ended 31 December 2006 and 2005

Statements of Changes in Shareholder没s Equity

Electricity Generating Public Company Limited

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Electricity Generating Public Company Limited

Statements of Cash Flows For the years ended 31 December 2006 and 2005

The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

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Electricity Generating Public Company Limited

Statements of Cash Flows For the years ended 31 December 2006 and 2005

The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

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Electricity Generating Public Company Limited

Statements of Cash Flows For the years ended 31 December 2006 and 2005

The notes to the consolidated and company financial statements on pages 131 to 179 are an integral part of these financial statements.

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

131

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

132

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

133

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

134

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

135

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

136

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

137

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

138

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

139

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

140

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

141

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

142

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

143

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

144

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

145

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

146

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

147

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

148

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

149

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3/29/07

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

150

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

151

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

152

For the years ended 31 December 2006 and 2005

Notes to the Consolidated and Company Financial Statements

Electricity Generating Public Company Limited

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153

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

154

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

155

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

156

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

157

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

158

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

159

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

160

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

161

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

162

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

163

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

164

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

155 165

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

166

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

167

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3/29/07

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

168

50-01-050 eng 168-169_J.ai

3/29/07

10:42:17 PM

Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

169

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3/29/07

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

170

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3/29/07

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

171

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3/29/07

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

172

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3/29/07

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

173

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

174

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

175

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

176

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

177

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

178

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Electricity Generating Public Company Limited

Notes to the Consolidated and Company Financial Statements For the years ended 31 December 2006 and 2005

179

Audit Fee

Audit Fee In 2006, the Company and its subsidiaries paid the audit fee of Baht 3,767,000 to the Office of the Auditors, comprising the Companyรปs audit fee of Baht 2,014,000 and subsidiariesรป audit fee of Baht 1,753,000. No audit fee had been paid to the auditors or other related parties to the auditors and the Auditorsรป office.

Non-Audit Fee The following non-audit fee was paid by the Company and its subsidiaries as the advisor fee for preparing the accounting policy manual and special review.

Payment to the Office of the Auditors: The amount of Baht 1,597,565 was paid to the Office of the Auditors for the service fee of the Company and its subsidiaries.

The Company would also be responsible for the expenses of undelivered work of Baht 279,000.

Payment to the Auditors or Other Related Parties of the Auditors and the Auditorsรป Office: In 2006, no fee had been paid to the auditors or other related parties of the auditors and the Auditorsรป office and there is no outstanding amount for the undelivered work.

The engagements of the office of the Auditors to provide the non-audit work were reported to be not involved the conflict of interest or the review of their own work which would contaminate the independence judgment of the auditors.

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General Information

Company

Business

Electricity Generating Public Company Limited (EGCO) Registration 0107537000866 (No.BorMorJor.333) Head Office EGCO Tower, 222 Moo 5, Vibhavadi Rangsit Road, Tungsonghong, Laksi, Bangkok 10210, Thailand Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 Sector Energy & Utilities Industry Resources Foreign Limit 44.81% Share of Minor Shareholder (% Free Float) 51.90% Website www.egco.com

Holding Company focusing on power and others related business

Paid-up Registered Par Value Share Capital (Baht) Share Capital (Mil ion Baht) (Mil ion Baht)

5.300

10

5,264.65

Ownership Interest (Direct+Indirect) (%)

-

Subsidiaries : Company

Business

Rayong Electricity Generating Company Limited (REGCO) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0931 Site Office 35 Rayong Highway No. 3191 Huay Pong Sub District, Amphur Muang, Rayong 21150, Thailand Tel. 66 0 3868-1012, 66 0 3868-1016, 66 0 3868-1020 Fax 66 0 3868-1784 Khanom Electricity Generating Company Limited (KEGCO) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0932 Site Office 112 Moo 8, Tongnean Sub District, Amphur Khanom Nakhon Sri Thammarat 80210, Thailand Tel. 66 0 7552-9173, 66 0 7552-9179 Fax 66 0 7552-8358 EGCO Engineering & Service Company Limited (ESCO) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0933 Site Office 35 Rayong Highway No. 3191 Huay Pong Sub District, Amphur Muang, Rayong 21150, Thailand Tel. 66 0 3868-2611-4 Fax 66 0 3868-2823

Independent Power Producer (IPP)

Paid-up Registered Par Value Share Capital (Baht) Share Capital (Mil ion Baht) (Mil ion Baht)

Ownership Interest (Direct+Indirect) (%)

4,702.20

10

4,702.20

99.99

IPP

5,000

10

4,850

99.99

Engineering, operation and maintenance services for power plants and manufacturers

400

10

400

99.99

181

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Subsidiaries: Company

Business

EGCO International (BVI) Limited (EGCO BVI) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 Oversea office Romasco Place, Wickhams Cay 1, PO Box 3140, Road Town, Tortola, British Virgin Islands Thai LNG Power Corporation Limited (TLPC) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 TLP Cogeneration Company Limited (TLP COGEN) (TLPC is the company没s 40% shareholder) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 EGCO Green Energy Company Limited Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 Roi-Et Green Company Limited (EGCO Green Energy Company Limited holds 95.00% shares in the Company) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 Agro Energy Company Limited (AE) (ESCO holds 99.99% shares in the Company) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 Egcom Tara Company Limited (ET) (ESCO holds 70.00% shares in the Company) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0945 Site office - Plant 1 332 Moo 2, Pongsawai Sub District, Amphur Muang Ratchburi 70000, Thailand - Plant 2 250 Moo 1, Pangpuay Sub District, Amphur Damneansaduak, Ratchburi 70130, Thailand

Holding company focusing on investment in electricity generating companies in foreign countries

Paid-up Registered Par Value Share Capital (Baht) Share Capital (Mil ion Baht) (Mil ion Baht)

Ownership Interest (Direct+Indirect)

2/1

39.952886/1

2/1

(50,000 USD)

(1 USD)

(50,000 USD)

Holding company focusing on SPP

750

10

513

100

Small Power Producer (SPP) Electricity and steam generating and supply business

1.060

10

1.060

80

Holding company focusing on power business

175

10

175

74

SPP utilizing Biomass as fuel

180

10

180

70.30

Trading/delivery service of fuel from natural scrap

2

10

2

99.99

Piped water generating and supply business

345

10

345

70

99.99

182

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Joint Ventures: Paid-up Registered Par Value Share Capital (Baht) Share Capital (Mil ion Baht) (Mil ion Baht)

Ownership Interest (Direct+Indirect) (%)

14,000

10

9,123.35

50

Holding company focusing on SPP business and other energy related business

1,168.43

10

662.33

50

SPP of cogeneration type Electricity and steam generating and supply business

1,500

10

1,350

14.85

SPP of cogeneration type Electricity and steam generating and supply business

1,060

10

1,012

15

2

10

2

50

729.32/2

91.17/2

729.32/2

40

(800,000,000 PESO)

(100 PESO)

(800,000,000 PESO)

Company

Business

Gulf Electric Public Company Limited (GEC) Office 11th FL., M. Thai Tower I, All Seasons Place, 87 Wireless Road, Lumpini, Phathumwan, Bangkok 10330, Thailand Tel没 66 0 2654-0155 Fax 66 0 2654-0156-7 Website www.gulf.co.th EGCO Joint Ventures and Development Company Limited (EGCO JD) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 Amata-EGCO Power Company Limited (AEP) (EGCO JD holds 29.70% shares in the Company) Office 33 Soi Lertnava, Krungthepkreetha Rd, Huamark Bangkapi, Bangkok 10240, Thailand Tel. 66 0 2379-4333, 66 0 2379-4246 66 0 2710-3400, 66 0 2710-3000 Fax 66 0 2379-4245. 66 02379- 4257 Amata Power (Bang Pakong) Limited (APBP) (EGCO JD holds 30% shares in the Company) Office 33 Soi Lertnava, Krungthepkreetha Rd, Huamark Bangkapi, Bangkok 10240, Thailand Tel. 66 0 2379-4333, 66 0 2379-4246 66 0 2710-3400, 66 0 2710-3000 Fax 66 0 2379-4245, 66 02379- 4257 Amata Power - ESCO Service Company Limited (AMESCO) (ESCO holds 50% shares in the Company) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 Conal Holdings Corporation (Conal) Office EGCO Tower Tel. 66 0 2998-5000 Fax 66 0 2955-0956-9 Oversea office Alsons Building, 2286 Pasong Toma Extension, Makati City, Metro Manila, Philippines Tel. 816-6740, 892-4632 Fax 814-0625

Holding company focusing on IPP and SPP

Power plant operation and maintenance services

Holding company focusing on power business in the Philippines

183

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Joint Ventures: Registered Par Value Share Capital (Baht)

Paid-up Ownership Interest Share Capital (Direct+Indirect) (Mil ion Baht) (%) /3 25 5,334.72

Company

Business

Nam Theun 2 Power Company Limited (NTPC) Office Unit 9, That Luang Road Nong Bone Village, P.O. Box 5862 Vientiane, Lao PDR Tel. (856-21) 263 900 Fax (856-21) 263 901

4,159/3 IPP 18,715.91/3 Electricity Generating and supply (450,000,00 USD) (100 USD) (1,28,266,421 USD) business

Other: Company Eastern Water Resources Development and Management Public Company Limited (EASTW) Office 9/9 Vibhavadi Rangsit Road, Talad Bangkhen, Laksi Bangkok 10210, Thailand Tel. 66 0 2940-9974-6 Fax 66 0 2561-3793 Website www.eastwater.com

Business Water resources development and management for supplying raw water to the customers

Registered Par Value Share Capital (Baht) 1,665

10

Paid-up Share Capital (Mil ion Baht) 1,324.07

Ownership Interest (Direct+Indirect) (%) 18.92

Note : The Exchange rate as of Investment Date /1 1 USD = Baht 39.952886 (July 13, 21, 2000) /2 1 PESO = Baht 0.91165 (August 25, 2000) /3 1 USD = Baht 41.5909 (August 30, 2002 and May 17, 2006)

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Referenced Persons

Regulator

Securities and Exchange Commission, Thailand 93/1 15th Floor, Diethelm Towers B, Wireless Road, Lumpini, Patumwan Bangkok 10330, Thailand Tel. 66 0 2695-9999 Corporate Affairs Department ext. 6008, 9509 E-mail: info@sec.or.th Website: www.sec.or.th

Regulator

The Stock Exchange of Thailand 62 The Stock Exchange of Thailand Building, Ratchadaphisek Road, Klongtoey, Bangkok 10110, Thailand Tel. 66 0 2229-2000, 0 2654-5656 Fax. 66 0 2229-2030, 0 2654-5649 S-E-T Call Center 66 0 2229-2222 E-mail: SETCallCenter@set.or.th Website: www.set.or.th

Share and Debenture registrar

Thailand Securities Depository Company Limited 62 The Stock Exchange of Thailand Building, Ratchadaphisek Road, Klongtoey, Bangkok 10110, Thailand Tel. 66 0 2229-2800 Fax. 66 0 2359-1259 Call Center 0 2229-2888 E-mail: contact.tsd@set.or.th Website: www.tsd.co.th

Auditor

1. Mr. Suchart Luengsuraswat Certified Public Accountant (Thailand) No.2807 2. Mrs. Nataporn Pan-udom Certified Public Accountant (Thailand) No.3430 3. Mr. Kajornkiat A-roonpairotekul Certified Public Accountant (Thailand) No.3445 PricewaterhouseCoopers ABAS Limited 15th Floor, Bangkok City Tower, 179/74-80 South Sathorn Road, Bangkok 10120, Thailand Tel. 66 0 2286-9999, 66 0 2344-1000 Fax. 66 0 2286-5050

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Index of articles required for the 56-2 form

(This is prepared in accordance with the notice of the Securities and Exchange Commission no. Kor Jor 40/2540 re: Criteria and Conditions of information Disclosure on financial status and operation performance of Listed Company) Topics 1. General information 2. Financial Summary 3. Business Characteristics 3.1 Business Operation 3.2 Revenue Structure 3.3 Industrial tread and Competition 4. Risk Factors 5. Shareholding and Management Structure 5.1 Shareholder 5.2 Management Structure 5.3 Director and Management Selection 5.4 Remuneration 5.5 Good Corporate Governance Report 5.6 Inside Information 5.7 Internal Control 6. Related Transaction 7. Management Discussion and Analysis 8. Financial Statements 8.1 Financial Statement 8.2 Audit Fee

Page No. 181 16 83 89 92 106 20 34 50 53 59 68 75 110 94 121 180

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Glossary 1. Companies The Company, EGCO, We Group companies, EGCO Group AE AEP AMESCO APBP APMC CHC, Conal CLP East Water, EASTW EGAT EGCO BVI EGCO Green EGCO JD ESCO ET GCC GEC, Gulf GEN GIPP GPG GYG KEGCO NKCC NMPC NTPC REGCO Roi-Et Green SCC SPPC TBC TLP Cogen TLPC WMPC 2. Government Organizations EPPO NEPC PWA SEC SET 3. Other Institutions IOD JBIC 4. Technical Terms COSO IPP SPP

Electricity Generating Public Company Limited Electricity Generating Public Company Limited and its subsidiaries and joint venture companies Agro Energy Company Limited Amata-EGCO Power Limited Amata Power-ESCO Service Company Limited Amata Power (Bang Pakong) Limited Alto Power Management Corporation Conal Holdings Corporation CLP Power Projects (Thailand) Company Limited Eastern Water Resources Development and Management Public Company Limited Electricity Generating Authority of Thailand EGCO International (BVI) Limited EGCO Green Energy Company Limited EGCO Joint Ventures & Development Company Limited EGCO Engineering and Service Company Limited Egcom Tara Company Limited Gulf Cogeneration Company Limited Gulf Electric Public Company Limited Gulf Energy Company Limited Gulf IPP Company Limited Gulf Power Generation Company Limited Gulf Yala Green Company Limited Khanom Electricity Generating Company Limited Nong Khae Cogeneration Company Limited Northern Mindanao Power Corporation Nam Theun 2 Power Company Limited Rayong Electricity Generating Company Limited Roi-Et Green Company Limited Samutprakarn Cogeneration Company Limited Southern Philippines Power Corporation Trang Biomass Company Limited TLP Cogeneration Company Limited Thai LNG Power Corporation Limited Western Mindanao Power Corporation Energy Policy and Planning Office National Energy Policy Council Provincial Waterworks Authority Securities and Exchange Commission, Thailand Stock Exchange of Thailand Thai Institute of Directors Japan Bank for International Corporation

The Committee of Sponsoring Organization of the Treadway Organization Independent Power Producer Small Power Producer 187

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