DH Power may appoint Sumitomo to build Sumatra mine-mouth power plant

Local power plant developer DH Power said on Monday it may appoint Japanese firm Sumitomo Corp as EPC contractor for its proposed 2x600-MW mine-mouth power plant in Muara Enim, South Sumatra.

?DH is currently in talks with Sumitomo,? CEO Kaz Tanaka told Petromindo.Com. DH Power is a unit of IDX-listed mining contractor firm PT.Darma Henwa Tbk.

Tanaka said current financial crises did not affect the company?s plan to go on with the US$1.8 billion project.

Tanaka hoped to get 70 percent loan finance for the project, adding that the company is currently in talks with JBIC and other Japanese banks. ?We hope to be able to complete project financing in 2009, to allow construction in 2010 and completion in 2014,? he said.

Electricity generated by the project will entirely be sold to state electricity firm PLN, which will build a 800-km transmission line from Muara Enim to Java. The project might cost PLN $1.2 billion, he said, adding that Japan International Cooperation Agency (JICA) might be involved in the transmission project under government-to-government scheme.

The company will build the power plant within the coal concession area owned by its subsidiary PT.Pendopo Energi Batubara. (bernard)