PLN secures local funds for power projects

State-owned electricity company PLN signed on Friday loan agreements worth Rp 5.7 trillion (US$=Rp 9,190) with several local banks to finance the construction of new power plants under the 10,000 MW crash program.

The banks are Bank Mega, BCA, BNI and Bank Mandiri.

Under the loan agreements, Bank Mega will provide loans for coal-fired power plant the 1 x 625 MW Suralaya power plant in Banten, while the syndication of BCA, Mandiri and BNI will finance the 2x315 MW Labuan power plant in Banten, the 3x330 MW Indramayu power plant in West Java, the 2x215 Rembang power plant in Central Java, and the 1x660 Paiton power plant in East Java.

PLN's Vice President Director Rudiantara said that the company was currently building a number of power projects in Java and outside Java with a total capacity of 7,000 MW as part of the 10,000 MW crash program.

The construction of the power projects need about Rp 30 trillion comprising of Rp 13 trilllion in local funds and about 3.5 billion in U.S. dollar.

Meanwhile, PLN's President Director Fahmi Mochtar said that PLN was "finalizing" deals to get additional loans worth about Rp 7.3 trillion from Bank Bukopin and Bank Mega for several power projects. Bukopin will provide loans totalling Rp 2.64 trillion while Mega will lend a total of Rp 4.6 trillion.

Bukopin will provide loan worth Rp 1.04 trillion for the Pacitan power plant in East Java and Rp 1.6 trillion for the Teluk Naga power plant in Banten.

Mega will provide Rp 1.87 trillion for the Pelabuhan Ratu power plant in West Java and another Rp 2.7 trillion for a number of coal-fired power plants to be built outside Java, including the Lampung, North Sumatra, West Nusa Tenggara, Riau Islands, Gorontolo, Southeast Sulawesi, and Central Kalimantan power plants.

"With the signing of the Rp 5.7 trillion loans, plus the other Rp 7.3 trillion loans which have been finalized, all the local funds needed for the projects have been secured," Rudiantara said following the signing of the loans.

PLN is now seeking to secure financial shortfall for the crash program amounting to $2 billion by exploring overseas financial resources schemes, such as through bilateral agreement or financial institutions.

"We will go to a number of countries, including China," Fahmi said. (*)