Indonesia Power secures $55m loan for E. Java power plant
Friday, May 25 2007 - 01:27 AM WIB
Three leading banks – PT Bank Internasional Indonesia Tbk.(BII), Citibank Indonesia and Standard Chartered Bank – have agreed to provide a loan of US$55 million to PT Indonesia Power (IP), a subsidiary of state electricity firm PT Perusahaan Listrik Negara (PLN).
The loan will be used to buy gas for its Grati combined cycle power plant in East Java.
Citibank will work also as financial advisor to IP in the gas purchase transaction. An agreement was signed in Jakarta on Thursday regarding the syndicated loan by all the parties.
“The signing of syndicated loan agreement is a BII’s commitment to support the government’s power generation programs,” BII’s corporate director Dira K. Mochtar said as quoted by Investor Daily on Thursday.
Citibank Indonesia’s country officer Peter B. Eliot said that the involvement in IP’s project will be the first time in which Citibank is financing an Indonesian company since 1997 monetary crisis.
Indonesia Power president director Abimanyu Suroso said the loan from the three banks is an evidence that the project is bankable, adding that IP will replace the high cost of diesel oil to gas as based fuel in Grati power plant. (*)