MoU on Borapulu geothermal development signed

Central Sulawesi administration has signed two memorandums of understanding (MoU) with state utility PT PLN and PT Indonesia Infrastructure Finance (IIF) on the development of geothermal power plant Borapulu.

The Mou was signed on Thursday by Central Sulawesi Governor Longki Djanggola, PLN Planning and Risk Management Director Murtaqi Syamsuddin, and IIF President Director Kartika Wirjoatmodjo in a signing ceremony which was also attended by the finance ministry Head of Fiscal Risk Management Center (PPRF), Freddy Saragih, and the Center of Government Investment (PIP) Investment Portfolio Division Head (PIP) Dian Lestari.

The two Mous were an initial step to utilize the geothermal fund facility (FDG) to develop the geothermal power plant Borapulu in Sigi regency of Central Sulawesi province under the scheme of the public private participation (PPP).

The geothermal fund facility is provided as a guarantee fund based on the finance ministry regulation (PMK) No.03/2012 and it is managed by the (PIP). It is hoped that with the guarantee fund, banks and other financial institutions will be encouraged to finance such geothermal projects.

The PPRF Chairman Freddy Saragih noted that if the Boropalu project complied with the nrequirements set by the PPP scheme and the power purchase agreement (PPA) with PLN, then the geothermal project would deserve the guarantee fund from the government as has been also stipulated in the presidential decree No.78/2010 on the guarantee of infrastructure under the PPP scheme.

Editing by Benget Besalicto Tnb.