Velcan announces additional delay on Meureubo 2 hydropower project
Thursday, April 14 2016 - 01:13 AM WIB
European hydropower developer Velcan SA announced Wednesday that the various parties involved in the tender and power purchase agreement (PPA) negotiation of the planned Meureubo 2 hydropower project in Indonesia?s Aceh province have not reached an agreement in the current RFP (Request For Proposal) process which was launched by state-owned electricity PLN on October 22, 2015.
As per the regulation, this RFP process has now been cancelled and closed, Velcan said in a statement.
?Velcan will now reengage with the parties involved to try to find a way to restart the procurement process and PPA negotiation. Administratively speaking this has to go through the complete re-initialization of a new RFP process, which is a lengthy procedure,? the statement said.
As of today Velcan said it is not able to give an indicative timeline for this new process.
?The Group is still of the opinion that Meureubo is an excellent project technically speaking and which can produce electricity at a competitive rate during and after the concession period, for the population of the Aceh Province,? Velcan said.
Velcan is the leader of the leader of the consortium of the Meureubo 2 Hydropower Project with a 70 percent stake alongside PT Pembangkitan Jawa Bali (PJB) with a 25 percent stake. PJB is a fully-owned subsidiary of PLN. PT PPC, Velcan?s local partner for this project, owns the remaining 5 percent of the consortium.
The consortium was selected as exclusive qualified prospective developer of the Meureubo 2 hydropower project in January 2015. PLN issued the Request For Proposal (RFP) from the consortium for the project in October 2015.
The RFP requires the consortium to present, on an exclusive basis, the project detailed features, costs and financing structure, and to offer a tariff for the power to be supplied through the Power Purchase Agreement proposed by PLN.
The bid submission date was initially scheduled on December 31, 2015, but the consortium failed to meet the deadline as it has to take into account the amendment of the consortium and to provide more time to prepare the detailed proposal which must include expressions of interests from lenders, financial institutions, EPC contractors and equipment manufacturers, Velcan said.
The teams of Velcan and PJB were supposed to finish the bid documents for a new expected bid submission date in March 2016.
Editing by Reiner Simanjuntak