PTBA-Hudian JV to build PLTU Sumsel 8

State owned coal mining company PT Bukit Asam Tbk (PTBA) is currently preparing the construction of a coal-fired power plant worth about US$1.5 billion in South Sumatra, Kontan business daily reported on Wednesday.

PTBA will establish a joint venture with China Hudian Corporation to build and operate the power plant which would be named PLTU Sumsel 8. The coal miner will have a 45 percent stake in the joint venture with its Chinese partner holding the remaining 55 percent.

About $375 million or about 25 percent of the funding for the project will come from equities, and the other $1.13 billion or about 75 percent from bank loans. With this funding structure, PTBA will spend about $108.75 million (Rp 1.6 trillion) from its own coffer for the project.

?The joint venture will be established this month, ? PTBA?s President Director Milawarma said, adding that the joint venture would then sign a power purchase agreement with state electricity company PLN as the buyer of the electricity supply from the power plant which will have a capacity of 2 x 620 megawatt.

Mulawarma hoped that the construction of the power plant could commence next year.

In addition, PTBA will also build another coal-fired power plant near the company?s coal mine in Pranap, Indragiri Hulu, Riau province. The company will cooperate with Malaysian company Tenaga Nasional Berhard to build and operate the mine-mouth power plant which will have a capacity of 2 x 600 MW.(*)