PTBA hopes to conclude revision of PPA for Sumsel 8 project in May
Wednesday, January 4 2017 - 02:46 AM WIB
Courtesy of PTBA
IDX-listed coal giant PT Bukit Asam Tbk (PTBA) hopes to be able to conclude discussion with state-owned electricity firm PT PLN over the revision of a power purchase agreement (PPA) for the planned 2x620 MW PLTU Sumsel 8 coal-fired power plant project in May of this year at the latest, reports said on Wednesday.
PTBA Corporate Secretary Adib Ubaidillah was quoted by Bisnis Indonesia as saying that the two companies have yet to start talks for the revision of the PPA, although the two have started informal discussion. ?The revised PPA has been submitted to PLN,? he said.
Under the draft, PTBA revises the terms for the financial closing of the Sumsel 8 project, one of which is a requirement for PLN to develop a 500 kV transmission high voltage direct current (HVDC) transmission line linking Sumatra and Java to transmit electricity from the PLTU Sumsel 8 project. Under the original PPA, PLN is required to issue letter of intent for the construction of the HVDC project to allow PTBA to start construction of the Sumsel 8 power plant project. ?The letter of intent for the HVDC has been eliminated so therefore the financial closing will no longer depend on PLN,? Adib said.
PLN has decided not to proceed with the HVDC project as the company wants to electricity output from the Sumsel 8 project to be allocated for Sumatra, instead of Java.
Adib added that PTBA will stick with the original design capacity of 2x620 MW for the Sumsel 8 project as the company has not received official request from PLN to alter the capacity. Reports quoting PLN Procurement Director Supangkat Iwan Satoso previously suggested PTBA to alter the design capacity of the power plant project to 4x300 MW as the existing infrastructure facilities in Sumatra will not be able to accommodate large generating units.
The estimated US$1.6 billion PLTU Sumsel 8 power plant project is now targeted to come on stream in 2021, a delay from the original schedule of 2019.
PTBA is teaming up with China?s Huadian Group to develop the power plant project. The joint venture company called PT Huadian Bukit Asam Power has already completed acquisition of the required 103 hectares land for the project, which has obtained funding commitment among others from Bank of China. (*)