PLN delays tender of PLTGU Jawa-3 project

Petromindo|Thomas

State-owned electricity firm PT PLN has decided to once again delay the planned tender for the 1x800 MW PLTGU Jawa-3 combined-cycle power plant project in Gresik, East Java, as the utility company is still unsure whether to proceed with the project as planned.

This was said by PLN President Director Sofyan Basir on Tuesday on the sidelines of the signing of a Heads of Agreement (HOA) between the company and state-owned oil and gas firm PT Pertamina over the supply of gas for PLN?s Gresik operation from the Jambaran Tiung Biru (JTB) gas field development.

Sofyan said that as the Gresik grid has been integrated, there will be less requirement for a peaker power plant such as the PLTGU Jawa-3 project. He added even if the company decides to go ahead with the project, the initial design capacity may have to be altered to adjust to future requirement.

He, however, said if the company will go ahead with the project, it will be assigned to its subsidiary PT Pembangkitan Jawa Bali (PJB) as private investors have little interest in peaker power plant project because only about 30 percent of the electricity output can be utilized.

PLN announced in June in June it planned to open tender for the PLTGU Jawa 3 project in the fourth quarter of this year, a delay from the initial plan of mid-2017, to select partner for PJB.

Gas supply for the planned PLTGU Jawa-3 power plant is expected to come from the JTB gas field, which is expected to start production in 2020. PLN has been engaged in lengthy negotiations with Pertamina over the JTB gas price, with PLN demanding a price of US$7 per mmbtu, while Pertamin was asking for a price of $8 per mmbtu to make the project economically feasible. Under the HOA signed on Tuesday, the gas price was finally agreed at $7.6 per mmbtu. The two are expected to sign the gas sales and purchase agreement within a month. (*)