Adaro acquires geothermal power plant operator

Publicly listed coal mining company PT Adaro Energy Tbk (ADRO) has agreed to acquire a majority stake in PT Sejahtera Alam Energy (SAE), which will build a geothermal power plant in Central Java, Investor Daily reported.

The acquisition will be carried out by Adaro Energy?s subsidiary PT Adaro Power which will take over the majority stake in SAE from PT Trinergy. ?Adaro will become a majority shareholder in SAE,? Herman Afif Kusumo, the chairman of Trienergy said.

SAE plans to develop a geothermal power plant with a capacity of 220 megawatt in Baturaden, Central Java. The construction will be carried out in stages and production capacity is expected to reach 110 megawatt in 2017.

The production capacity will be expanded by 70 megawatt in 2019 and by another 40 megawatt in 2021, Herman said, adding that the total investment for the project is expected to reach $1 billion.

Herman said that the acquisition process would be completed in 45 days from December 20, 2011.

Adaro, the second largest coal producer in Indonesia, is also developing a coal-fired power plant in Pemalang, Central Java in cooperation with J-Power and Itochu. Adaro plans to spend up to $230 million in equity for the construction of the Pemalang power plant which will have a capacity of 2 x 1,000 megawatt.

Adaro and its partners J-Power and Itochu should inject between $600 and $700 million in equity for the project, which account for about 20 percent of the total investment of between $3 billion and $3.5 billion. Adaro has a 34 percent stake in the project, J-power (34 percent) and Itochu Corporation (32 percent). (*)