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PT Bumi Resources Indonesia, the country's biggest coal
exporter, will build two "mine-mouth" power plants at a cost of US$1.2
billion in Muara Enim, South Sumatra, a company executive says.
The two plants will have a combined capacity of 1,200 megawatts (MW).
Bumi vice president director Kaz Tanaka said Tuesday in Jakarta that
the construction of the coal-fired plants was expected to begin in 2010.
He said that the plants would be built in a coal-mining concession held
by a company subsidiary in Muara Enim. The concession is believed to
contain coal deposits of up to 1 billion tons.
"We plan to supply the electricity to South Sumatra and also West
Java," he said, adding that the project would benefit from the
government's plan to build a Java-Sumatra electricity interconnector.
Under the plan, a submarine cable will be laid in the Sunda Strait to
link the power grids of Sumatra and Java so that excess power supply in
Sumatra can be supplied to Java.
Tanaka said that his company had already entered into negotiations with
state-owned electricity utility PLN. However, he refused to be drawn on
the substance of the discussions as the interconnector project was
still only at the planning stage.
He added that Bumi had set up a consortium called DH Power to handle
the sale of the output from the two power plants. However, he did not
give the names of the consortium members.
Bumi, Asia's third largest coal producer, plans to boost production to
90 million tons by 2010 from an estimated 60 million tons this year to
tap rising demand from India and China, the world's two-fastest growing
major economies.
The company produced 53.5 million tons of coal in 2006.
Last week, India's Tata Power Company Ltd. (TPCL), the second biggest
power producer in India, purchased a 30 percent stake in Bumi for
US$1.3 billion.
Bumi owns two leading Indonesian coal miners, PT Kaltim Prima Coal
(KPC) and PT Arutmin Indonesia. Under the recent deal, Tata will source
50 percent of its coal imports into India from the two Indonesian
companies.
Meanwhile, Korea Western Power Co., a unit of state utility Korea
Electric Power Corp., said it also planned to build a 400 MW power
plant in South Sumatra province, in cooperation with an Indonesian coal
mining company.
PT Tambang Batubara Bukit Asam, which holds a coal concession in Bangko
Barat area where the power plant will be constructed, may supply 2
million metric tons a year of the fuel, Milawarma, a director at the
company, said in Jakarta Tuesday.
"We have completed the preliminary feasibility study and will study the
results," he said by telephone. The power plant will feed electricity
to homes and factor ies on Indonesia's Sumatra island.
The Indonesian government wants private power producers to add 10,000
megawatts of capacity by 2010 using coal and gas to cut the country's
dependence on more expensive oil-based fuels.
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