PLN signs electricity deal with Unocal

State electricity firm PT Perusahaan Listrik Negara (PLN) has signed a revised power purchase deal with the local unit of U.S. oil giant Unocal Corp after lengthy talks, Reuters quoted an energy official as saying on Tuesday.

PLN is trying to settle a raft of disputes with independent power producers (IPPs) which stem from deals signed in the 1990s which either collapsed or had to be renegotiated due to the Asian financial crisis.

"PLN has signed an agreement with Unocal on electricity from the Salak geothermal plant at a price of 4.45 cents per kilowatt hour," the official said, referring to a 165 megawatt plant in West Java.

"The contract period is until the year 2040," he added.

The previous contract was set at 8.4 cents/kilowatt hour.

He said Unocal was also given the option to expand its geothermal operations in West Java.

PLN signed contracts with some 27 IPPs and last month said it was optimistic of settling a number of them this year.

Earlier this month it amended a deal with the local unit of Paiton Energy, partly-owned by U.S. firm Edison Mission Energy, and Jawa Power, majority owned by Siemens AG.

Power demand in Indonesia is currently estimated to be growing by around 10 percent annually, one of the most robust markets in Southeast Asia. (*)