PLN debt to PT Energi Sengkang rescheduled

State electricity company PT Perusahaan Listrik Negara (PLN) and private power producer PT Energi Sengkang have agreed in principle to reschedule PLN's electricity purchase debt of US$30 million to the latter following their agreement to re-negotiate their contract.

The head of PLN's South and Southeast Sulawesi business unit, Fuad Alhady, told Satunet Internet news service in Makasar on Saturday (May 5) that the rescheduling of the debt was to save PLN's short-term finance situation due to the increasing operational costs.

"The debt matter has been discussed at the level of the head office, and the final agreement will be signed in June at the latest," Fuad said.

Actually, Fuad said, there was big differences in the calculation of PLN's obligation to PT Energy Sengkang, that operates 135-megawatt geothermal-powered power plant in Sengkang, South Sulawesi.

According to PLN's calculation, the obligation that PLN had to pay to Energy Sengkang was only US$10 million, while the latter claimed that PLN's debt amounted to $30 million.

Because of the differences, re-negotiation of the contract between PLN and Energy Sengkang had been put on hold. Actually, Energy Sengkah had agreed to cut the selling price of its electricity to PLN.

PT Energi Sengkang is 47.5 percent controlled by Energy Equity Corp. Ltd. of Australia 47.5 percent by El Paso Energy Corp. of the United States and the remaining 5 percent by PT Triharsa Sarana Jaya Purnama. (*)