PLN denies it will go bankrupt

State electricity company PT PLN has denied a report that it will go bankrupt by the end of this year unless the government restructures its debts.

"PLN has never made such a statement. It is true that we wrote a letter to the government early in August," PLN President Director Kuntoro Mangkusubroto said on Saturday.

The report had earlier said that the company suffered a loss of an estimated Rp11.1 trillion in the first semester of this year due to an upsurge in operational costs, banking interest, and loss from the rupiah's depreciation against the US dollar.

The loss had reduced the company's capital to Rp2.3 trillion. Unless a change in the capital structure was made, the company would go bankrupt by the end of this year.

For this part, the PLN president director wrote a letter to then State Minister of Investment and State Enterprises Development Rozy Munir on August 9 this year, the report said.

According to the letter, Kuntoro asked for help from the minister to restore the company's financial condition by granting tax relief, among others.

Kuntoro said the government had yet to respond to the letter.

"The concept (of settling PT PLN's debts) remains the same, namely debt equity swap," he said.

He said the problem must be left to the finance minister to solve. "Let him (the finance minister) study it first. Hopefully, by the end of this year it could be settled. We do not set any deadline for the government to settle it," he said.

He also said the national growth of electricity consumption reached nine percent last year and even several provinces, such as Lampung saw a 15 percent growth, East Java (13 percent) and Bali (15 percent).

"If until the second quarter of this year the growth remains the same (as last year), we will achieve our target," he said without elaborating. (*)