Int'l partners join Catur Yasa in major projects

PT Catur Yasa will share center stage with top international partners this week as it participates in signing ceremonies for two major projects which will carry on operations well into the next century.

Catur Yasa, the major shareholder of the energy company PT Batu Hitam Perkasa, will be one of the signatories at the US$1.8 billion Engineering, Procurement and Construction (EPC) agreement, as well as the boiler and turbine memoranda of understanding for the Paiton Swasta I power plant located in Probolinggo, East Java.

The company is also scheduled to sign an agreement to operate, maintain and manage 50 diesel power plants located at eight different sites in Indonesia's eastern most province of Irian Jaya. The plants are owned by PT Freeport Indonesia.

The agreements attest to the confidence of outstanding global corporations in the capabilities and prospects of Catur Yasa, a leader in Indonesian energy and telecommunication projects during the past 20 years, says Catur Yasa President Kusumo A.M.

"I consider the signing of these agreements to be particularly appropriate during the ongoing Asia-Pacific Economic Cooperation summit," Kusumo says. "It is a fine testament to the cooperation which can be made between different countries in this region."

Paiton

The Paiton Swasta I power plant marks a coming of age in the international business community for Catur Yasa.

"We see Paiton as a symbol of our growth," says Kusumo. "This multi-billion dollar project demonstrates our readiness to work with the world's leading companies to develop our nation's energy and telecommunications infrastructure."

The US$2.6 billion plant will be the first large scale privately-owned, financed and operated power plant in Indonesia. It will be constructed under a historic Power Purchase Agreement which was signed between PLN, the state electricity corporation, and Paiton in February 1994. The agreement, which followed 18 months of intense negotiations between the two parties, is the first project to sell electricity exclusively to PLN based on a three-tiered tariff rate for its 30-year duration.

Paiton will build, own and operate the 1,230 MW plant, which is scheduled to begin producing electricity in 1998. The plant is expected to be a significant source of power for Indonesia's main island of Java, where more than 60 percent of the nation's 190 million people live. It will also support industrial, commercial and residential growth as Indonesia sets course to emerge as a newly industrialized nation in the next century.

Paiton is a consortium of major domestic and international companies. These include Batu Hitam Perkasa, an Indonesian private domestic company formed in 1989 to participate in the development of Indonesia's private power industry, which holds a 15 percent stake. Other partners include affiliates of the Mission Energy Company, the United States' largest non-utility developer of cogeneration and independent power production facilities, holding 32.5 percent.

Also involved are affiliates of Mitsui and Co., a Japanese business conglomerate active worldwide as an organizer of international business ventures aimed at linking sources of supply and demand (32.5 percent), and General Electric Company of the U.S., which commands diversified global technology, services and manufacturing (20 percent).

The Paiton Swasta I, whose design is based on the Seminole plant in the U.S., will operate under the Indonesian government's stringent environmental protection and air-quality standards. Batu Hitam Perkasa will supply the plant with clean-burning low- sulfur coal from its mine in the province of Kalimantan.

Freeport

Catur Yasa's contract to operate, maintain and manage Freeport Indonesia's diesel-power plants in Irian Jaya presents its own challenges, Kusumo says.

"I need to stress that its not the size of the project that is important," he states. "There will be many aspects to handle in management and operations, but I am confident Catur Yasa has the experience and experienced personnel to solve any problems we encounter."

Freeport Indonesia's operations in Irian Jaya are projected to eventually cover around 4 million hectares and Catur Yasa will be responsible for managing them.

Kusumo points to his company's cooperation with Freeport as a telling example of the United States' increasing business involvement in the Asia-Pacific region.