Exploitasi PPA of two power plant projects terminated
Saturday, January 28 2017 - 05:07 AM WIB
IDX-listed coal mining company PT Exploitasi Energi Indonesia Tbk on Friday announced power purchase agreements (PPAs) of two power plant projects in Riau Province signed previously with state-owned electricity firm PT PLN have been terminated.
Exploitasi said in a statement that the PPA termination was made last year after the two companies failed to find solution to problems that have hampered the project. No further details were provided.
Exploitasi announced in March of last year, it was forced to halt construction of two coal-fired power plants in Riau as its lender suspended a lending facility after the investment cost escalated.
The company said that the creditor, Bank Rakyat Indonesia (BRI), wants certainty that its investment in the two projects can be safely returned.
Eksploitasi was developing two coal-fired power plants in Rengat and Tembilahan, Riau Province, each with capacity of 2x7 MW. About 65 percent of the investment requirement was to be financed via loan from BRI. The company did not say the reason for the cost escalation.
Editing by Reiner Simanjuntak