Signing of PPA between BUMI and PLN delayed

The signing of a power purchase agreement (PPA) between state owned electricity company PLN and a consortium of PT Bumi Resources Tbk has been delayed. Bumi earlier expected the PPA would be signed in the first quarter of this year, Kontan reported on Saturday.

BUMI?s corporate secretary Dileep Srivastava said in Jakarta recently that negotiations on the price of power to be sold to PLN were still underway. ?The agreement will be signed in near future. It is now under process,? he added.

Srivastava said that there were no problems in the negotiation process, but he did not explain why the PPA could not be signed according to the original schedule.

A consortium of BUMI, DH Energy and Posco Engineering & Construction has won a tender to build a coal-fired power plant with a capacity of 2 x 300 MW, and with total investment of about US$1 billion. The independent power producer will sell the electricity to PLN.

BUMI has a 5 percent stake in the consortium, but its subsidiary PT Pendopo Energi Batubara is the majority shareholder. BUMI has a 85 percent stake in Pendopo with the remaining 15 percent held by DH Energy. The majority shareholder of DH Energy is PT Darma Henwa Tbk, which is also part of Bakrie Group.(*)