Govt approves loan facility for Java-Sumatra transmission project

The government has approved the entire loan facility for the financing of the Java-Sumatra electricity transmission project, which should pave the way for the tender process to be started, according to Director General of Electricity Jarman as quoted by Investor Daily on Wednesday.

Total investment for the project is estimated at US$2.13 billion. Japan International Cooperation Agency (JICA) has previously agreed to provide $1.19 billion funding for the project under a 30-year loan facility, guaranteed by the government, with interest rate of 0.3 percent per year.

Jarman said that the government has recently given its approval for the remaining loan requirement of $929 million. ?Funding for the project has been approved, it is now in the process of entering the blue book (list of projects funded by loans guaranteed by the government),? he said on Tuesday.

He added that after the approval, tender process for the project could be started.

The 500 kV transmission project will link Banko Tengah, in South Sumatra, and Bogor, in West Java. It will include the development of a 40 km under water cable from Ketapang in Lampung to Salira in Banten. (*)