PLN to get loans worth $899 million from Chinese banks

State-owned electricity company PLN will soon receive loans worth about US$899 million from Chinese banks to finance four coal-fired power plants currently being built as part of the government?s 10,000 MW fast track program.

?We will sign the loan commitment with the Chinese banks early next month,? PLN?s president Fahmi Mochtar said Monday in Jakarta.

Fahmi said that about $899 million of the loans would be provided by China Export Import Bank (Cexim).

The loan to be provided by Cexim would be used to finance the construction of Pacitan coal-fired power plant in E.Java (US$293 million), Pelabuhan Ratu coal-fired power plant in West Java ($482 million) and Aceh coal-fired power plant ($124 million), which are all being built by Chinese contractors.

The Pacitan power plant, which will have a capacity of 2 x 315 megawatt, is built by Dongfang Electric, while Pelabuhan Ratu power plant with a capacity of 3 x 300 megawatt is built by Shanghai Electric. The Aceh power plant with a capacity of 2 x 100 megawatt is built by Harbin Power.

Fahmi adding that Bank of China and Chinese Development Bank would also provide loan to finance the construction of Teluk Naga coal-fired power plant in Banten which will have a capacity of 3 x 315 megawatt.

?The loan commitment for the Teluk Naga coal-fired power plant was initially scheduled for signing during the Asian Summit in Thailand this week, which was later cancelled due to anti-government demonstration. We therefore plan to sign the loan agreement for Teluk Naga in May,? he said.

PLN had so far secured a total of $5.5 billion in funding for the program, including around $1.7 billion signed with Chinese lenders last year, out of a total of about $8 billion.

Under the official timetable, about 1,000 MW generating capacity had been due to come onstream this year, around 7,000 MW in 2010, and the remainder in 2011. (*)