Siemens and PowerGen to invest in Paiton II

Siemens and PowerGen to invest in Paiton II

JAKARTA (JP): Siemens Power Ventures GmbH and PowerGen signed
the financing documents for the US$1.7 billion Paiton II power
plant in London yesterday, Siemens announced recently.

In a statement made available yesterday, Siemens said the
1,220 megawatt coal-fired power project to be located in Paiton,
East Java, is owned by PT Jawa Power, a joint venture of Siemens
Power Venture who owns 50 percent of the company, PowerGen 35
percent and PT Bumipertiwi Tatapradipta 15 percent.

On April 3, 1995, Jawa Power signed the power purchase
agreement with state-owned electricity company PT PLN which
requires PLN to buy the power under a 30-year contract.

The agreement also set a one-year deadline for financial
close.

Siemens said yesterday that an international bank consortium
led by Credit Suisse and including Kreditanstalt fuer
Wiederaufbau, Dresdner Bank, Sanwa Bank and Toronto Dominion Bank
will provide loans totaling $1.36 billion.

The bank group will also include institutional investors led
by Teachers and Prudential Insurance Co., while J.P. Morgan will
act as the investors' financial adviser.

Siemens Power Generation Group will lead the construction
group, which also includes Combustion Engineering Inc. of
Connecticut and Black & Veatch Construction Inc of Kansas City,
Missouri.

Reuters quoted the company as saying that the first of two
610-megawatt blocks will go on the grid in 1999, and the second
in the following year.

PowerGen will operate and maintain the plant. The coal will be
provided under long-term contracts from two mining companies in
Kalimantan. (08)