DSSA to start operation of Sumsel-5 in December

By Tri Subhki R

IDX-listed energy and mining firm PT Dian Swastatika Sentosa Tbk (DSSA) will start the operation of its 2x150 MW mine mouth power plant called Sumsel-5 in December this year.

The project, which was initiated in 2013, will have coal supply from DSSA?s coal mining subsidiary company PT Andalan Satria Lestari (ASL) in Musi Banyuasin, South Sumatra.

?The development progress of the project is 90 percent, and is expected to start operation in December this year,? DSSA Director Hermawan Tarjono said on Wednesday. He added that ASL will supply 2 million tons of coal per year to Sumsel-5, a US$400 million worth power project located in South Sumatra.

DSSA signed a Power Purchase Agreement (PPA) with state-owned utility company PT PLN (Persero) for 25 years in 2011. On May 4, 2015, DSSA through its indirect subsidiary company PT DSSP Power Kendari signed PPA with PLN to develop Independent Power Producer (IPP) Kendari-3.

DSSA sees power industry as a lucrative business as the government fully supports the 35,000 MW power generation project. In the first quarter of 2015, DSSA?s power generation unit contributed 10 percent of total revenue US$144.6 million.

?Once the Sumsel-5 starts the operation, we expect power generation unit will contribute up to 20 percent of total revenue,? Hermawan said.

Editing by Reiner Simanjuntak