Pertamina, PLN to continue Dieng, Patuha power projects: Purnomo

The state-owned oil and gas firm Pertamina will continue to develop the geothermal power projects in Dieng, Central Java, and in Patuha, West Java, together with the state electricity company PLN, according to Minister of Mineral Resources and Energy Purnomo Yusgiantoro.

This was despite earlier remarks made by Pertamina president Baihaki Hakim that his company was no longer interested in developing the power projects.

The Kompas daily quoted Purnomo as saying that it was important for the projects to be immediately implemented to be able to generate cash to help repay government obligation.

The Dieng and Patuha power projects, each with a capacity of 60 MW, were initially developed by MidAmerican Energy Holdings but was stopped by the government in the wake of the 1997 financial crisis. The delay had caused the government to pay some US$260 million in compensation to OPIC, which insured the projects, and another $140 million to lenders. The government plans to obtain cash for paying the claims from the power projects once they are in operation.

The government needs to raise some $400 million to restart the projects.(*)