New Indonesian Plants Plug Power Gap - China Supplies Gas Feedstock

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Researched by Industrialinfo.com (Industrial Information Resources Incorporated; Houston, Texas). Indonesia continues to make moves to plug the country's ongoing power gap, which has been in danger of becoming a gaping hole with power demand growing at an estimated 10% per annum in a nation of around 120 million people, the fourth largest population in the world.

The country's state owned electricity utility, PT Perusahaan Listrik Negara (PLN) has announced that supplies in southern Sumatra will be augmented by the construction of two coal-fired power plants with a combined capacity of 200 megawatts (MW). Financing for the $200 million project is expected to come from the Japan Bank for International Cooperation (JBIC).

Construction is expected to start this year, and the plants are scheduled to start feeding power to the region by late 2005 or early 2006.

The JBIC is also funding 85% of the 740 MW Cilegon gas fired power plant (PEC 93000118) in West Java. PLN has awarded the $354 million construction contract for the plant to Mitsubishi Heavy Industries (TOKYO:7011) (Tokyo, Japan). The projected is scheduled for completion in 2005. JBIC's finance will be in the form of export credits. The 15% project balance will come from PLN.

The gas feedstock for the plant will be provided by China's CNOOC (HK:0883) which, under a sales agreement still to be signed, will supply 70 million cubic foot per day.