Paiton II power project underway

JAKARTA (JP): PT Jawa Power, a consortium of Bimantara Citra, Siemens AG of Germany and PowerGen of Britain, has started the construction of the Paiton II coal-fired steam power plant in Probolinggo, East Java.

"The Paiton II power plant, which will cost US$1.7 billion, will have a generation capacity of 1,220 megawatts (MW)," Jawa Power's president, Gerald H. Falgenhauer, told the press after a ground breaking ceremony led by East Java Governor Basofi Sudirman in Probolinggo on Friday.

"The construction of the first unit of the Paiton II, with a capacity of 610 MW, will be completed in 1999 and the second unit, with a similar capacity, will be finalized a year later," he was quoted by Antara as saying.

Siemens said recently that the power project will be financed by loans from a consortium of international banks led by Credit Suisse.

Jawa Power is 50 percent owned by Siemens, 35 percent by PowerGen and 15 percent by Bumipertiwi Tatapradipta, a subsidiary of Bimantara Citra, which is controlled by Bambang Trihadmodjo, the second son of President Soeharto.

Once construction of the plant is finished, Jawa Power will operate the power plant for 30 years, after which it will be transferred to the state-owned electricity company PT PLN.

On April 3, 1995, Jawa Power signed a power purchase agreement with PLN which requires the state company to buy the former's electricity under a 30-year contract at the price of 6.6 U.S. cents per kilowatt hour (kWh).

The Paiton II will get its coal from PT Kideco Jaya Agung and PT Berau Coal in Kalimantan.

The construction of the Paiton I steam power plant at the same area, with a generating capacity of 1,230 MW, has been completed by PLN and its electricity is transmitted through the Java-Bali inter-connected networks. (13)