China Huadian to set up mine mouth power plant in Sumatra
Tuesday, April 7 2015 - 02:09 AM WIB
One of the five biggest utility firms in China, China Huadian Hong Kong limited, will build a 2 x 660 MW mine mouth power plant in South Sumatra to supply electricity in Sumatra and Java islands, local representative of the company, Yanto Sutanto said.
Sutanto made the statement after accompanying delegates from the company meeting with Indonesian President Joko Widodo at the State Palace on Monday.
In building the estimated US$2 billion project, (called Sumsel Mine Mouth 8) the firm will partner with IDX-listed coal giant PT Bukit Asam Tbk, he said.
China Huadian accounts for 55 percent and PT Bukit Asam 45 percent of the total investment costs, said Sutanto, adding that bank loans would also be used to help finance the coal-fired power plant project.
Groundbreaking of project is expected to take place before the end of this year, and to be completed within 3 years, said Sutanto.
The power output is to supply demand in Sumatra Island, and later distributed to Java Island via under water transmission, he said.
China Huadian signed a deal with Indonesian state-owned power firm PT PLN in September 2012, in which PLN will build the transmission facility and price of the electricity is more than 5 cent per KWH, said Sutanto.
President Director of PLN Sofyan Basir said on Monday that the firm will soon complete the construction of the transmission facility.
At the same occasion, Energy and Mineral Resources Minister Sudirman Said said that one of the main obstacles in the project is the construction of the transmission from then power plant to Java.
Editing by Reiner Simanjuntak