SINGAPORE -- Struggling Singaporean utility Senoko Energy is requesting a rescue package of lending and other support from the government to ride out a supply glut expected to persist for a few more years.

Senoko has asked to borrow an estimated 100 million to 200 million Singapore dollars ($73 million to $146 million).

"With the severe business outlook for the next year or two creating the risk of a shortage of operating capital, the utility is battening down the hatches," said an official at Marubeni, the Japanese trading house that acquired Senoko with four partners more than a decade ago.

Senoko is also lobbying for the government to create a system that guarantees an assured revenue stream under long-term contracts, regardless of power plant utilization.

Singapore's energy supply has outstripped demand. To diversify sources, the government in 2010 began offering preferential measures for facilities fired by liquefied natural gas. This spurred launches of new power stations, starting in 2013, and the industry's supply capacity is now double the city-state's peak demand. Proceeds from electricity sales are not enough to cover costs for fuel, maintenance and financing. Overcapacity is expected to continue until around 2022.

Senoko was bought for SG$3.65 billion in 2008 by Kansai Electric Power; Kyushu Electric Power; the Japan Bank for International Cooperation; Marubeni; and French company GDF Suez, now Engie. The Singaporean company slipped into the red in 2016, and its net loss widened to about SG$400 million in 2018.

Senoko refinanced SG$2.1 billion in loans this May. An agreement was also made for certain shareholders to provide more cash in the event of a funds shortage, according to a source close to the matter.

It seems that utilities' demand forecasts were also too optimistic. Senoko had expected demand to grow steadily, backed by strong economic growth in Singapore. But demand has fallen short of forecasts, according to sources. Supply and demand factors pushed another utility, Tuas Power Generation, to a net loss of about SG$167 million in the fiscal year through December 2018.

One reason for the poor performance of troubled water treatment companyHyflux was its entry in 2016 into the crowded power generation business.

Asked about the current supply glut, a spokesperson with the Energy Market Authority stressed that power companies made their investment decisions based on bullish projections for electricity demand growth that did not materialize.

"Flexibility was provided for power generation companies to retire theirsteam plants," the official added. "While the power generation market is currently experiencing a situation of having more supply than demand, this looks to be changing as electricity demand is increasing with more data centers coming onstream, as well as older and inefficient generating units being decommissioned."

The utilities' poor performance has also weighed on earnings of Marubeni and Japanese financial institutions. Marubeni recorded an extraordinary loss of 23.7 billion yen for its power generation business in Singapore in the fiscal year ended March.

MUFG Bank's Singapore Branch also logged a net loss of SG$225 million in the fiscal year ended March, due to huge impairment loss write-downs. Higher loan-loss reserves for Senoko appear to have increased its losses.