JBIC eyeing coal projects financing

Japan?s government lending arm Japan Bank for International Cooperation (JBIC) is eyeing to finance two major coal projects in Indonesia, a senior official said on Tuesday.

?JBIC is interested to finance Central Kalimantan coal railway project and also committed to provide financing for Kobe Steel to set up commercial coal upgrading facility,? Fumio Hoshi, JBIC Executive Director Asia and Oceania Finance Department told reporters on a sideline of an infrastructure conference in Jakarta.

Hoshi said that if the successful bidder at the US$2.2 billion project to build the 185-km railway would be Japanese company, JBIC will be keen to provide financing for the project.

Petromindo.Com report in march 2011 said that there are four consortia that has been short-listed to bid on the project comprising Itochu and Toll consortium, the consortium of Drydocks and MAP Resources Indonesia, Bakrie Indo Infrastructure and a consortium led by Mega Guna Ganda Semesta. Bid submission for the project is expected this month.

Hoshi also said that Kobe Steel has recently declared that its upgrading coal plant in South Kalimantan commercial and may soon start constructing upgrading coal plant on commercial scale. ?JBIC will be involved in the financing of the project,? he said.

Hoshi said JBIC?s financing capability on overseas projects was not negatively affected by the recent Tsunami and earthquake that has devastated the country . ?There?s still plenty of money in Japan?s banking system and the appetite is still there,? he said.

Indonesia is the largest JBIC?s debtor with US$9 billion outstanding debts as per March 2010, he said.(alex)