Duke Energy, Mitsubishi agree to terminate power purchase contract with PLN
Wednesday, February 14 2001 - 08:00 AM WIB
American energy firm Duke Energy Corporation and its partners including, Japanese firm Mitsubishi Corp, had agreed to terminate the sale and purchase contract with cash-strapped PT PLN for power supplies from the planned coal-fired power plant in Cilacap, Central Java, Minister of Energy and Mineral Resources Purnomo Yusgiantoro said.
Purnomo said in a written statement presented during a working meeting with the House of Representatives' Commission VIII for energy and mineral resources, environment, science and technology that Duke and partners had agreed to terminate the power purchase contract (PPA) in November last year without requiring PLN to pay any compensations.
Data published by PLN several years ago said Duke, which is listed on the New York Stock Exchange, had a 35 percent stake in PT Citra Kartika Daya which signed the PPA with PLN on Dec. 23, 1996 for power supplies from the 400-Megawatt coal fired power plant to be built by the company in Cilacap.
Other partners are Mitsubishi (35 percent) and local firm PT Bimantara Citra (20 percent), controlled by former President Soeharto's son Bambang Trihatmodjo, and local firm PT Kanugrahan Kartika Perkasa (10 percent), which is a unit of the Indonesian army's business arm Kartika Eka Paksi.
It remains unclear if the consortium has started the construction of the Cilacap power plant.
Aside from Duke and partners, Purnomo said, the owner of the Tanjung Jati A project had also agreed to terminate its PPA with PLN without requiring the state company to pay any compensation.
The Tanjung Jati A power project is owned by PT Tanjung Jati Power Company, which comprise local firm Bakrie Power (20 percent), a unit of the Bakrie group, PT Maharani Paramitra (20 percent), controlled by former President Soeharto's daughter Siti Hediati Prabowo, Japanese firm Tomen Power (30 percent) and British firm National Power (30 percent).
Tanjung Jati Power Company planned to build a 1,320 MW coal fired power plant in Tanjung Jati, Central Java.
The PPA with Tanjung Jati Power Company was terminated in May last year, Purnomo said.
Purnomo said the Cilacap and Tanjung Jati A power projects were two of three power projects on which PLN had reached settlement with independent power producers (IPP).
Another one project on which PLN had completed renogiations is the Darajat geothermal power project belonging to Amoseas, which is the consortium of American energy firms Chevron and Texaco.
Amoseas, which has built a 70 MW geothermal power plant in Drajat, West Java, agreed on May 12 last year to reduce its power price from 6.9 U.S. cents per kilowatt hour (Kwh) to 4.2 cents. It also agreed to reduce the price for its goethermal steam supply to PLN's subsidiary PT Indonesia Power, which has built a 55-MW power plant in the area, from 4.537 cents per kwh to 2.9 cents.
Purnomo added PLN was also close to an agreement with the owner of the Cilegon power project on the termination of the PPA.
The Cilegon power project, which is sometimes called the West Java power project, belongs to PT Daya Listrik Pratama, which, according to PLN data, is owned by Italian firm Ansaldo Energy (45 percent), Dutch firm Sachsen Holding (45 percent), a subsidiary of American energy firm NRG Energy Inc, and local firm PT Fenergi Cipta (10 percent), a subsidiary of PT Kiani Metra Tujuhdua, partly owned by Mohammad Bob Hasan.
The company planned to build a 400-MW coal-fired power plant in Cilegon and signed PPA with PLN on Nov. 13, 1996.
Purnomo added PLN was still negotiating with the owners of the Paiton I, Paiton II, Pare-Pare, Tanjung Jati B, Tanjung Jati C, Sibolga A, Amurang, Serang, West Palembang, Cikarang, Asahan, Sengkang, Salak 4,5,6, Wayang Windu, Kamojang, Cibuni, Sibayak and Sarulla power projects.
Some of the power projects have completed the construction works and are already in operation. They are Paiton I and II in Probolinggo, East Java; Sengkang in South Sulawesi; Pare Pare in South Sulawesi, Salak 4,5,6 in West Java, Wayang Windu in West Java and Cikarang, West Java. (Godang/ Bodega)