Sengkang to build gas power plant

JAKARTA (JP): PT Energi Sengkang, a joint venture between PT Trihasra Sarana Jaya Purnama and Energy Equity Asia Power Ltd. of Australia, will build and operate a combined-cycle power station in Sengkang, South Sulawesi, with an investment of US$176 million.

"The planned power station will start operation in 1998 with a capacity of 135 megawatts," PT Trihasra Sarana Jaya Purnama's president, Indradjid Subardjo, announced yesterday after signing an agreement with state electricity company PLN.

Under yesterday's agreement, PLN will buy electricity to be produced by Energi Sengkang at 6.7 U.S. cents per kilowatt-hour (kWh). The price will comprise the cost of power generation at 6.5 U.S. cents per kWh and the transmission cost of 0.15 U.S. cents per kWh.

"The power construction will start soon to catch up with our schedule," he said, adding that it is the first integrated project involving the private sector company as both supplier of natural gas and generator of electricity.

Indradjid pointed out that the power station, which is the first electricity project involving an Australian company, will be built under a build, operate and own system for 20 years.

He noted that his company will also construct a 30-km transmission network from its natural gas power plant in Sengkang to the nearest PLN electricity station in Soppeng, South Sulawesi.

He added that during the 20-year contract period, the price of gas to be used for the power station is set at US$2.85 per million British thermal units.

According to Indradjid, Minister of Mines and Energy I.B. Sudjana approved the gas price in February.

At yesterday's signing ceremony, Sudjana acknowledged that the government faces financial problems in developing energy resources for its energy diversification programs.

"As the government is hampered by a financial limitation in developing electricity projects, we call on the private sector to increase participation in energy development," he said. (13)