ADB, OPIC may finance Sarulla geothermal power project

The Asian Development Bank and the U.S. government?s Overseas Private Investment Corp. may finance a proposed US$600 million Sarulla geothermal power plant in North Sumatra. The Jakarta Post reported Wednesday.

The two development agencies have provided letters stating their financial support for the project, Hilmi Panigoro, president director of PT Medco Energi Internasional, Indonesia?s biggest publicly traded oil company and part of the group planning to build the plant, said in an interview on Sept. 8.

?The final terms will still have to be negotiated,? Panigoro said. Loans are expected to cover as much as 75 percent of the project costs, he said.

Medco-led consortium is developing a combined gross capacity of 340 MW geothermal power project, owning and operating the facilities and selling electricity to PLN under a 30-year Power Purchase Agreement (PPA). The project will cost about US$600 million.

Japanese trading house Itochu Corp. and the U.S.-based manufacture company Ormat International Inc are the members of the consortium. (*)