Dian Swastatika to allocate $500 million for two power projects

PT Dian Swastatika Sentosa Tbk (DSS) is taking part in a prequalification tender for the construction and operation of two power plants in South Sumatra and South Kalimantan to be built as part of the Phase Two 10,000-MW power plant development program, Kontan reported Wednesday.

DSS president director Lay Krisnan Cahya said in Jakarta recently that the company would allocate US$500 million for the construction of the two power plants. ?About 70 percent of the funds will be in the form of bank loans and another 30 percent will be taken from the company?s internal source,? Krisnan said.

If it wins the two power plant projects, DSS will operate as an independent power producer (IPP). One of the mine-mouth power plant (Sumsel-5) will be built in South Sumatra with a capacity of 2x 150 MW. The other one (Kalsel-1) will be built in South Kalimantan, with a capacity of 2x 100 MW.

Krisnan said that the construction of the Sumsel-5 power plant would cost about $300 million while that of the Kalsel-1 power plant would cost about $200 million.

DSS hopes to be awarded with the two power plant projects as it will become an important step for the company?s expansion program into the power generation, according to Krisnan.

At present, the company operates four power plants, all in Wes Java with combined capacity of 300 MW. Up to the third quarter of this year, the power sector represents the second largest contributor to the company?s revenues after coal. The company?s earning from the power sector reached $38 million in the period or about 23 percent of the total revenues which reached $156.57 million. The company?s earnings from coal production reached $65.80 million. (*)