Indonesia’s PLN to Operate 3 New Coal-Fired Plants

Jakarta Globe, December 28, 2011

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Indonesian state utility Perusahaan Listrik Negara will operate three new coal-fired power plants in Banten, the company said on Wednesday.

PLN CEO Nur Pamudji said, these power plants are crucial to step up power capacity in Java and Bali from 19,700 up to 23,000 megawatt (MW).

The coal-fired power plant is also said to cut PLN expenses as much as 19.9 trillion rupiah ($2.19 billion) per year, by converting from fuel-based power plant.

Details on power plant projects as follows:

— PLTU 1 Banten-Suralya: Capacity at 1 x 625 megawatt with 2.9 million metric tons per year coal consumption. Located in Suralaya, Banten, with investment size at around $478 million. The project is run by CNTIC and Indonesia state-owned Rekayasa Industri consortium.

— PLTU 3 Banten-Lontar: Capacity at 3 x 315 megawatt with 1.4 million metric tons per year coal consumption. Located in Lontar, Banten, with investment size at around $808.4 million. The project is run by China power equipment giant Dongfang Electric Corporation and Dalle Energy consortium.

— PLTU Tanjung Jati B: Capacity at 2 x 662 megawatt with 2.2 million metric tons per year coal consumption. Located in Tubanan, Central Java, with investment size at around 160 billion yen ($2.06 billion). The project is run by Japan’s third-largest trading firm Sumitomo Corporation, Wasa Mitra Engineering and Bangladeshi power firm Summit Power Development Ltd.

Indonesia wants to boost its electricity capacity under the government’s fast-track program to add a total of 20,000 megawatts generating capacity. Power shortages are common in Indonesia, where poor infrastructure is one of the factors restricting growth in Southeast Asia’s largest economy.

Reuters

SBY opens coal-fired power plant, pushes for more alternative energy

The Jakarta Post, Jakarta, Fri, 07/29/2011

President Susilo Bambang Yudhoyono on Friday said the proportion of geothermal energy in the second phase of the 10,000 megawatt project should be augmented.

"Do not just [adjust the contributions] from coal-fired power plants," the President said in Palembang, South Sumatra, on Friday at the groundbreaking of the Mulut Tambang Banjarsari coal-fired power plant (PLTU) in Lahat.

He added that increasing the contribution from geothermal energy power plants should be increased as part of efforts to rely more on renewable energy, kompas.com reported.

J-Power, Adaro, Itochu win $3.2 bln Indonesia power plant

Reuters Africa, Thu Jun 2, 2011

JAKARTA, June 2 (Reuters) - A consortium of Japan's Electric Power Development Co (J-Power) , Itochu Corp and Indonesian coal miner Adaro Energy have won a tender to develop a $3.2 billion coal-fired power plant in Java, Indonesia's state power firm Perusahaan Listrik Negara (PLN) said on Thursday.

The 2,000-megawatt power plant marks the first public-private partnership (PPP) project among many that Indonesia's government is hoping for to overhaul its infrastructure, said Dahlan Iskan, PLN's CEO.

He said risks in the project's development would be covered by the Indonesia Infrastructure Guarantee Fund, set up for government initiated infrastructure projects.

"The tender is a milestone for PLN and the Indonesian government, because this is the first public-private partnership project that was auctioned successfully," Iskan said in a press statement.

Power shortages are common in Indonesia, where poor infrastructure is one of the factors restricting growth in Southeast Asia's largest economy. The government says it needs $150 billion in infrastructure and is looking for two-thirds from private investors.

President Susilo Bambang Yudhoyono launched a "masterplan" last month to drive the country to become a world top ten economy by 2025, including many planned PPP projects.

The consortium's Pemalang power plant is expected to begin operations in 2017.         

(Reporting by Alfian; Editing by Neil Chatterjee) 

JBIC to finance two power plant projects

Rangga D. Fadillah, The Jakarta Post, Jakarta | Tue, 04/12/2011

The Japan Bank of International Cooperation (JBIC) said Tuesday it was ready to finance the development of two power plants in Central Java and North Sumatra with a total value of more than US$1 billion.

The bank's executive director, Fumio Hoshi, told reporters that negotiations on funding the two projects had reached the final stage and he expected the tender process could be completed in the near future.

“At the moment there is a tender for Central Java's supercritical coal-fired power plant project, [the winner will be announced next month], he said at the Indonesia International Infrastructure Conference and Exhibition 2011. “We’re also working on the Salula geothermal power plant in North Sumatra.”

Beside the two power plants, the JBIC might also finance other geothermal power plant projects in Sumatra, Hoshi revealed.

Two Japanese companies identified at least four potential geothermal fields on the island, he added.

Nuclear Power Not Needed in Indonesia: PLN

Jakarta Globe, Ririn Radiawati Kusuma, March 23, 2011

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State Electricity Company (PLN) says it does not need nuclear power plants — yet.

The comments follow a continued effort by the National Nuclear Energy Agency (Batan) to push for the use of nuclear energy in Indonesia despite an international backlash due to the ongoing nuclear disaster in Japan.

“Commercially, Indonesia does not need nuclear power plants yet,” PLN president director Dahlan Iskan told the Jakarta Globe on Wednesday.

He said producing nuclear energy was more expensive than producing electricity from coal and gas.

He said as well as coal and gas, which Indonesia had in abundance, other options included renewable energies, such as hydro and geothermal.

He did, however, say that it would be good for Indonesia to begin preparations for the possibility of using nuclear energy.

Batan is now focusing on the island of Batam as a proposed site for a nuclear power plant. Batam lies uncomfortably close to the major fault line that produced the 2004 Indian Ocean earthquake and tsunami.

Related Articles:

PLN Chief: We Do Not Need Nuclear Power... Yet

RI Soil Too Unstable For Nuke Power

R-Power to invest $5bn in Indonesia

TNN, Jan 25, 2011, 02.38am IST

MUMBAI: In what is being seen as one of the largest foreign investments in Indonesia, Reliance Power will infuse $5 billion (around Rs 22,000 crore) in two projects-one each in South Sumatra and Jambi provinces. The investment covers coal mining, setting up of railway lines, ports and power projects.

According to a senior company official, who did not wish to be identified, the project in South Sumatra involves development of a 2- billion MT coal mine, a 200-km railway line, a port and a 2,000-MW power project at a cost of $3.5 billion. The project in Jambi involves another coal mining unit, along with a port, railway line and a small power plant. It will cost $1.5 billion without the power project.

Reliance Coal Resources, a subsidiary of Reliance Power, will sign two MoUs with representatives of the governments of both the provinces in New Delhi on Tuesday. Reliance ADA Group chairman Anil Ambani and Indonesian President Susilo Bambang Yudhoyono are exected to be present during the occasion. Fiscal concessions, including land, are being offered to Reliance Power to make it attractive for them to invest in Indonesia, the official said. The investment for the development of the coal mine, rail & port infrastructure and the power project in Sumatra would be made in the next five years.

In 2010, Reliance Power's wholly owned subsidiary Reliance Coal Resources had acquired three coal mines owned by two companies PT Sriwijaya Bintang Tiga Energi and PT Brayan Bintang Tiga Energi in the South Sumatra province. The three mines are spread over 1,25,000 acres and have over 2 billion MT of coal. The Indonesian government is providing the other concessions as Reliance Power would develop the other projects associated with it which include the railway line, port and power.

Coal from these mines will be exported for Reliance Power's Krishnapatnam Ultra Mega Power Project in Andhra Pradesh. which is based on imported coal and also used for its 2000 mw project in Indonesia. These mines would ensure steady supply to the Krishnapatnam Project and also be more economical than other imported coal. Officials said talks are already on with banks to finance the first project in south Sumatra.

Five Banks Sign Agreement for New East Kalimantan Power Plant

Tempo Interactive, Thursday, 19 August, 2010 | 16:22 WIB

TEMPO Interactive, Jakarta: Five national banks signed a financing agreement for a 2 X 100 megawatt coal power plant construction in Balikpapan, East Kalimantan, worth around Rp2 trillion.

Governor Awang Faroek Ishak attended the singings today (19/8) by Steven Johanes (Bank Central Asia), I Made Suka (Bank Rakyat Indonesia), Ronny Kuntadi (Vice President Bank Mandiri), Oswald Tambunan (Grup Head Corporation BNI 46) and Aminuddin (Chief Director of Bank Pembangunan Daerah East Kalimantan).

Aminuddin said the signings today followed a similar MoU with the State Electricity Company for the plant to be built in Kariangau area, which is part of the first batch of the 10,000 megawatt projects.

The syndication charged 8.125 percent interest for the loan which sould be repaid in 10 years.

The five banks had also agree to provide loan for another coal power plant in Maluku.

FIRMAN HIDAYAT

Adaro eyes $2.45 billion power plant projects

The Jakarta Post, Jakarta | Thu, 08/05/2010 10:08 AM | Business

JAKARTA: Coal mining company Adaro Energy is eyeing two power plant construction projects worth US$2.45 billion, corporate secretary Andre Mamuaya said Wednesday.

Andre said Adaro would cooperate with several Japanese companies, such as J-Power and Itochu Corp., to bid for construction and operation contracts for two 1,000 megawatt power plants in Pemalang, Central Java, which were valued at more than $2 billion.

Adaro would also bid to develop two 100 megawatt power plants in South Kalimantan in cooperation with Japan’s Mitsui & Co, Andre said, adding that the company would need $220-250 million for the project.

“We hope we can self-finance the expansion plans,” Andre said. Adaro’s cash and cash equivalent position is currently $600 million.

Adaro said it produced 21.62 million tons of coal in the first half and sold 21.75 million tons. — JP

Construction starts on Riau coal power plant

Rizal Harahap, The Jakarta Post, Pekanbaru | Sat, 05/08/2010 10:46 AM

Construction started on a 20-megawatt coal-fed steam power generating station in Peranap, Indragiri Hulu, Riau, that will illuminate the regency by mid 2012, said PT Bukit Asam managing director Sukrisno at the station’s inauguration on Thursday.

PT Bukit Asam, the state-owned coal mining firm, would build the plant near its coal mine in Semelinang Tebing village, 250 kilometers south of Pekanbaru, the capital of Riau, he added.

Construction of the PLTU Peranap power plant would cost an estimated Rp 300 billion (US$32.6 million), he added.

Exploratory studies that date from June 1985 were finally realized after the company decided to use its own money to speed up construction of the plant, said Sukrisno.

The power pant was just the first part of Bukit Asam’s plan to foster development in Riau, he added.

The company would also build additional infrastructure needed for the station, such as schools, housing for new employees and additional power lines.

Power produced by PLTU Peranap would eventually be sold to the public by PT Perusda, which is operated by the regency administration.

The coal mining firm had decided to distribute power outside the state-owned electricity company’s network to reach users in six neighboring districts, said Sukrisno.

The plant will end the power crisis in Indragiri Hulu and promote small business in Riau, he added.

Bukit Asam’s potential coal reserves of 370 million tons in Peranap had given the company an opportunity to develop its coal export business and would fuel two additional power plants that it planned to build in Riau in the near future, said Sukrisno.

The Peranap mine had previously produced 12 million tons of coal per year and would be able to fuel seven stations similar to PLTU Peranap, and produce 200 megawatts, he said.

“We plan to build additional power plants with a total combined output of 300 megawatts by 2015 and maximize use of Peranap’s coal potential.”

Bukit Asam manages coal mines in South Sumatra, West Sumatra and East Kalimantan and the coal mine and power generation station in Peranap are part of an expansion program, said Sukrisno.

The company had a concession to mine coal in a 17,000-hectare area of Peranap. Bukit Asam had already acquired 80 percent of the land, he added.

Indragiri Hulu Regent Mujtahid Thalib said he had promised to help build a network to distribute power to residents in remote areas.

Riau Deputy Governor Mambang Mit said that when completed, the power plant would minimize the Riau’s chronic power crisis.

Reports say Riau province produces 150 megawatts and faces a power deficit of 42 percent during peak hours.

Riau’s ratio of available power to demand is the lowest in Indonesia. The province will face a power deficit of 1,100 megawatts in the next five years without new power stations.

PLN to build PLTU in Batang

Antara News, Sunday, April 25, 2010 13:29 WIB

Batang, C Java (ANTARA News) - State electricity company PT PLN plans to build a coal-fired power plant (PLTU) in Batang regency, Central Java province.

Head of the Batang Environment Agency Agus Riyadi said Saturday previously a team of the Central Java Energy and Mineral Resources Agency and Environment Impact Control Agency (Bapedal) has conducted a survey of the location where the PLTU would be built.

"As a final decision on the project has yet to be made, the PLTU project would be built in Batang regency as the location is very strategic," he said.

He said a number or areas where a PLTU will be built are the Denasri Kulon coast, Ujungnegoro, Celon, and port of Kedawung village, Gringsing subdistrict.

However, he added, the building of the 2,000 megawatts (MW) PLTUs in Java, may need 250 hectares of land with a project investment of Rp30 trillion.

"The Batang regency administration has prepared the land for the PLTU," he said.

He added that according to the result of a survey and criterium, it would be quicker to build a PLTU on the coast of the port in Kedawung village, as it is far from a railroad track and the planned Batang-Semarang toll road project.

Besides, the process of compensation to the land owners is also much more simplified because most of the land for the project belonged to PT PLN.

We believe that it would be more strategic to build the PLTU on the coast of the port, Kedawung village, compared to other locations," he said.

China lends Indonesia US$2b

The Strait Times, Apr 3, 2010

Indonesian Trade Minister Mari Pangestu (L) and China's Minister of Commerce Chen Deming (R) - (AFP)

YOGYAKARTA (Indonesia) - CHINA has agreed to lend at least US$1.8 billion (S$2.5 billion) in soft loans to Indonesia as part of its free trade agreement with the 10-member Association of Southeast Asian Nations (Asean), a minister said on Saturday.

The China-Asean Free Trade Agreement, which imposed zero tariffs on a range of goods, came into effect in January and has prompted fears among some Indonesian businesses that the domestic market would be flooded with cheap Chinese imports, leading to job losses in a country which already has high unemployment.

Indonesia's Trade Minister Mari Pangestu, who met China's Commerce Minister Chen Deming in Yogyakarta, Central Java, on Saturday, afterwards announced that China would provide US$1.8 billion in export buyers credits to finance the import of Chinese goods used for infrastructure projects such as toll roads, bridges and coal-fired power plants.

In addition, China will provide 1.8 billion yuan, also for infrastructure-related projects, while Chinese banks would help finance trade between the two countries.

Export-Import Bank of China will provide a US$100 million loan and Industrial and Commercial Bank of China may lend US$250 million to companies investing in both countries, according to a statement from the trade ministry.

Indonesia's largest lender PT Bank Mandiri Tbk will open a branch in China to further help trade between the two countries, according to the ministry. -- REUTERS

PLN to build special coal terminal

Antara News, Friday, February 5, 2010 07:12 WIB

Pandeglang (ANTARA News) - State power company PT PLN will build a special coal terminal in Labuan subdistrict, Pandeglang regency, for the supply of coal to PLTU Labuan, unit 2.

"PT PLN has already submitted a plan for the special coal terminal, which is currently still under discussion," head of the Pandeglang cleaning and zoning agency D Hasahatan said here Thursday.

The discussion covers matters relating to development in close harmony with government policies of central and regional level, port development and optimizing the utilization of zoning and integrating local, regional and national transformation.

He also said that the master plan in the making needs to cover territorial waters and land zoning on the basis of the aspects and parameters of nature, operations, facilities, equipment, and type of cargo.

"The master plan also needs to be flexible to support development and environmental aspects," he said.

According to the National Zoning Plan, part of Banten province is covered by a certain area which gets priority in development, namely the Cilegon industrial estate, Tangerang within Jabodetabek (Jakarta, Bogor, Debok, Tangerang and Bekasi), classified as a fast growing area.

The Soekarno-Hatta international airport as a national gate, port of Bojonegara as international port which is integrated with Jakarta`s Tanjung Priok of Jakarta.

The same is also true with Sunda Bay which is an international lane linked to the Indian Ocean and the South Chinese Sea.

PLTU Labuan, unit 2, in Labuan subdistrict, Pandeglang regency, Banten province, inaugurated by President Susilo Bambang Yudhoyono on January 28, 2010, needs coal to move its two turbines.

The power plant has a capacity of 300 x 2 megawatts (MW) and was built to meet the power supply shortage in Java and Bali power grid.

Member of Commission VII of the House of Representatives Irna Narulita Dimyati has asked to prioritize Banten province in getting power supply from PLTU Labuan.

"The PLTU is a national project, but as it is located in Pandeglang, it is only reasonable that Banten has the priority for power supply from the power plant," Irna said here Saturday.

Of the total number of people of Banten, only 250 thousand families are enjoying electricity.

Balikpapan to Build 80 MW Power Plant

Tempo Interactive, Thursday, 04 February, 2010 | 13:42 WIB

TEMPO Interactive, Jakarta:The Balikpapan City Government, East Kalimantan, will inaugurate a 80 MW Power Plant.

This power plant construction could resolve Balikpapan’s electricity deficit.

“The power plant will be soon inaugurated at Batakan,” said Balikpapan mayor Imdaad Hamid today.

According to Imdaad, the power plant is built to supply a need of 92 MW of electricity in Balikpapan.

The project is included in the development program of 10,000 MW of power plants in East Kalimantan.

When in use, Imdaad said, the Balikpapan power plant will join with the Mahakam System belonging to state-owned power firm PLN.

“This power plant will reduce the electricity deficit for Balikpapan residents,” he said.

The East Kalimantan PLN Mahakam System still suffers a 20 MW deficit to fulfill a peak load of 200 MW.

As a consequence, PLN have to alternate electricity blackouts in Balikpapan, Samarinda and Tenggarong.

SG WIBISONO

Indonesia to construct 93 power plants in 2nd project

The Jakarta Post, Alfian , Jakarta | Sat, 01/30/2010 12:53 PM | Business

The government has announced its list of 93 power plants to be built under the second 10,000-megawatt (MW) power generation scheme.

"With the issuance of the decree, the bidding for the power plant procurement can now be opened," J. Purwono, the director general for electricity and energy use, said Friday.

The power plants are expected to generate up to 10,153 MW in total. Of this figure, 5,770 MW or 57 percent will go into the Java - Bali grid, while the rest will go to the other islands across the archipelago.

This second project is expected to promote the use of clean and renewable energy, but coal-fired power plants will still contribute significantly.

Of the total capacity, up to 1,204 MW (12 percent) will be generated by hydroelectric plants; 1,660 MW (16 percent) from gas combined-cycle plants; 3,977 MW (39 percent) from geothermal plants, and 3,312 MW (33 percent) from coal-fired plants.

The biggest hydroelectric plant in the project will be the 4x250-MW Upper Cisokan plant in West Java.

The biggest gas combine-cycle plant will be the expanded Muara Tawar plant, also in West Java, with total capacity of 1,200 MW.

The 1,000-MW Indramayu power plant in West Java will be the biggest of the coal-fired plants in this second phase, while the Sarulla 1 plant in North Sumatra, with expected total capacity of 3x110 MW, will be the biggest of the geothermal power plants.

Of the total 10,153 MW power expected to be generated from the project, state electricity company PT PLN is expected to generate a little more than half, or 5,118 MW.

The remaining 5,035 MW is expected to come from plants run by independent power producers (IPPs).

Although set to produce an almost equal amount of electricity, the power plants to be built by the IPPs will require double the investment that PLN's plants warrant.

Constructing all the power plants will require US$15.96 billion in investment. Of this figure, only $5.90 billion will go to PLN.

The IPPs will require a greater capital outlay as they will focus on geothermal power plants, which are far more costly than PLN's coal-fired plants.

Of the total 3,977 MW set to be generated by geothermal, IPPs are expected to contribute 3,097 MW.

The second 10,000-MW project will include the construction of 3,490 kilometers of power transmission lines, requiring $383 million in investment.

The project is expected to be finished in 2014.

Bukit Asam Announces Contract With Indonesia Power

Tempo Interactive, Thursday, 21 January, 2010 | 19:23 WIB

TEMPO Interactive, Jakarta: State coal miner PT Tambang Batubara Bukit Asam reported its new contract with PT Indonesia Power a subsidiary of the State Electricity Company to supply coal for the Suralaya coal power plant in Cilegon, West Java.

The one year contract set the coal price at Rp685,000 per ton for coal with 5,000 calories/kilogram. The deal should provide Bukit Asam a total of Rp3.67 trillion until December 31st 2010.

Spokesman for Bukit Asam Achmad Sudarto said in the company's report to the Indonesia Stox Exchange said Bukit Asam will ship a total of 5.5 million tonnes of coal to the Suralaya power plant.

It posted 13.2 million tonnes sales in 2009 and predicted a 20 percent rise this year to 15 million tonnes.

FAMEGA SYAVIRA

Bakrie Group to Develop Power Plant Project

Tempo Interactive, Monday, 18 January, 2010 | 19:34 WIB

TEMPO Interactive, Balikpapan: East Kalimantan Governor Awang Faroek has said that Bakrie business group plans to work on a power plant project and the Balikpapan-Samarinda toll road construction.

”For the electricity project there will be a Rp2.4 trillion investment,” said Governor Awang in Balikpapan, East Kalimantan, yesterday.

This total investment does not include the toll road construction.

The power plant project, said Awang, will use coal supplied from the Bumi Resources mine at East Kutai.

The power plant is projected to supply 2 x 100 megawatts of electricity.

The electricity supply from the new power plant could solve the electricity deficit from the Mahakam power plant, which is down to 20 MW.

The toll road construction, Awang continued, will also be a project the Bakrie Business group is interested in.

The 85 kilometer road is expected projected to cost Rp4.2 trillion.

Investors will bear half of the total investment while the rest will be obtained from the central and the regional budget.

sg wibisono

Indonesia Sweetens Deal for Private Power Companies

Jakarta Globe, Janeman Latul

A pre-paid electricity customer topping up his account. The government wants independent power producers to build most of the new power plants in the second phase of its “fast-track” electricity project. (Antara Photo)

The government will scrap import duties on equipment needed to build power plants to encourage independent companies to build plants in the second phase of its “fast-track” electricity generating program.

A presidential decree to this effect, obtained by the Jakarta Globe on Thursday, was signed last week.

“The construction of power plants will be exempt from import duties and enjoy other facilities that will be regulated by the Finance Ministry,” the decree said.

However, one private sector energy firm interested in participating in the fast-track program said the government would need to offer more incentives to independent producers if it wanted them to build plants in the second phase of the program.

The ambitious $15.6 billion program calls for the construction of 82 new coal-fired, geothermal, hydroelectric, and natural gas-fired power plants across the country to alleviate chronic power shortages, with the plants expected to come online between 2013 and 2015.

The government hopes to entice independent producers to build the majority of the plants — 58 — and supply a total capacity of 4,262 megawatts of power. Many of the plants to be built by independent producers would be in remote, sparsely populated areas.

PLN will build the remaining 24 plants with a combined capacity of 6,415 MW.

Erwin Aksa, president director of PT Bosowa, a diversified business conglomerate involved in the energy sector, said that while he welcomed the presidential decree it was unlikely to be enough to encourage independent producers to get more involved in the sector.

“It’s a good start, but the power producers need more certainty because we’re not the only country in Asia that is trying to attract investors to infrastructure projects,” Erwin said. “Investors would first be looking to see whether our project offers a better return than in other countries. Incentives, including tax breaks and guarantees on land acquisitions, should also be included in the decree, to make the policy comprehensive and attractive.”

The decree also guaranteed that PLN would purchase electricity from independent producers involved in the “fast-track” program, with the details to be issued later by the Finance Ministry.

Currently, state electricity company PT Perusahaan Listrik Negara’s generating capacity is only sufficient to supply about 60 percent of national demand for electricity.

PLN buys electricity from private producers to partially meet the shortfall.

Independent producers have only recently been allowed to supply PLN with power. Previously, they were only permitted to supply large industrial users with factories located near their plants.

Jacobus Purwono, the Energy Ministry’s director general of electricity and energy utilization, said on Wednesday that the government planned to subsidize the cost of power PLN bought from private producers.

Currently, government subsidies on electricity force PLN to sell power at as little as 40 percent of production costs, and it has often demanded equally low prices from independent producers.

Low electricity prices and a lack of government guarantees on projects have scared many investors away from “fast-track” projects.

In the first phase of the “fast-track” program, which is still ongoing, PLN is building 14 new coal-fired plants.

Indonesia says UAE fund plans to invest $5.2 bln

Reuters, Thu Jan 7, 2010 3:16am GMT

JAKARTA, Jan 7 (Reuters) - The UAE's Middle East Coal (MEC) plans to invest $5.2 billion in infrastructure in Indonesia's East Kalimantan including a power plant, a railway and a smelter, the head of Indonesia's investment agency (BKPM) said.

The projects in the province on Borneo island include an around 140-km railway, a 1,400 megawatt coal-fired power plant and an alumina smelter, Gita Wirjawan said late on Wednesday.

Wirjawan confirmed the plans in a mobile phone text message to Reuters, adding: "as for the railway project, the land clearing has been done in the past months and the first stone will be laid in March."

MEC from the emirate of Ras Al Khaimah is a joint venture between UAE investment fund RAK Minerals and Metals Investments (RMMI) and UAE-based mining company Trimex.

Wirjawan said that the projects were expected to be completed within the next 3-4 years as investors had received financing commitments from Middle East banks and had the technology needed for the projects.

Resources-rich East Kalimantan has big reserves of coal and other minerals.

Indonesia, the world's most populous Muslim nation, has been keen to attract more foreign investment investment from the Middle East.

The Southeast Asian country expects foreign direct investment to rise 15 percent this year after only reaching just below $10 billion last year, according to data from the investment agency.

(Reporting by Dicky Kristanto and Andreas Ismar; Editing by Ed Davies)

PKT to spend US$140 million on capital expenditure in 2010

Nani Afrida, The Jakarta Post, Jakarta | Thu, 12/24/2009 9:57 AM

State fertilizer producer PT Pupuk Kalimantan Timur (PKT) plans to spend US$140 million in capital expenditure next year, mostly on building a new coal-fired power plant.

“We will spend $120 million of capex on constructing the plant” PKT President Director Hidayat Nyakman told journalists on the sidelines of new factory ceremony in West Java on Wednesday.

PKT also plans to spend $15 million on new factories and about Rp 400 billion on its cooperation with several plantation companies.

Hidayat said that the company will mobilize the capex from internal cash flow and loans from banks, including state bank PT Bank Rakyat Indonesia (BRI), which has committed $100 million for PKT.

“We will receive gas supply in the beginning of next year, so that it will be easy for us to get some loans from banks,” Hidayat said.

By the end of this year, about 208,000 tons fertilizer from PKT will be exported, he says.

“Vietnam and Thailand have won the biddings [for the purchases],” Hidayat said.

PKT, a subsidiary of state fertilizer company PT Pupuk Sriwijaya (Pusri), now operates five urea fertilizer factories with a total capacity of 2.98 million tons per year.

It also operates four ammonia factories with a total capacity of 1.85 million tons per year.

PKT is the biggest fertilizer producer in Indonesia as it supplies two-thirds of the country’s urea fertilizer production.

The company aims to produce 3 million tons of urea next year.

In the first half of the year, the company’s revenue dropped by 26 percent to Rp 3.7 trillion ($373.7 million) on the back of lower fertilizer prices, meanwhile its profits before tax stood at Rp 370 billion.

In 2008, the company booked Rp 627.8 billion in net profits, a 52 percent increase from a year earlier.

Domestic consumption of fertilizers currently stood at 1.4 million per year. The government predicts that in 2025 Indonesia will need about 23.2 million tons which will have to be provided by fertilizer producers.

On Wednesday, the government officially opened a new factory belonging to state fertilizer PT Pupuk Kujang, which can produce up to 100,000 tons of NPK granules per year to help meet growing domestic market demand.

Indonesia power chief to build plants outside Java

Reuters, by Muklis Ali, Wed Dec 23, 2009 5:02pm IST

JAKARTA, Dec 23 (Reuters) - Indonesia's state electricity firm plans to build new power plants outside Java island with a combined capacity of around 2,000 megawatts to resolve chronic power shortages, the firm's newly appointed head said on Wednesday.

Dahlan Iskan, a 58-year-old media tycoon who also operates a small power plant in East Kalimantan, replaces Fahmi Mochtar as president director of PT Perusahaan Listrik Negara (PLN) after criticism over power shortages in the capital and other areas.

PLN operates around 25,000 MW of electricity, but most of its plants are old, so daily output is far below capacity.

"We plan to boost electricity generation outside Java, because they have already had shortages for years," Iskan told reporters after a ceremony to mark his appointment.

He said that the new small-scale coal-fired power stations with a combined capacity of around 2,000 MW would be built in areas such as Kalimantan and Sulawesi.

The administration of President Susilo Bambang Yudhoyono had put pressure on Mochtar, who was appointed in March last year, to increase power capacity after frequent blackouts across much of the archipelago.

Local media has been reporting for some time that Mochtar would go and Indonesia's state enterprises minister Mustafa Abubakar said the replacement of the president and other directors at PLN was aimed at refreshing management.

"We evaluated the board of directors of PLN and as a result we decided we needed new management to develop the company further," Abubakar said.

Yudhoyono has previously criticised PLN management for failing to respond to pressure from the regions to build new power plants.

The government has launched two crash programmes to increase power generation because Southeast Asia's biggest economy faces chronic power shortages after years of under investment.

The first crash programme aims to add 10,000 MW of coal-fired power stations to meet electricity demand that officials say is growing at around 10 percent a year.

The second phase, due to start next year, aims to tap more alternative sources of energy such as geothermal to meet rising power demand and cut consumption of expensive crude oil as reserves dwindle.

PLN plan to tender for power projects worth $2.3 billion next year under the second phase of the 10,000 MW programme with nearly half, or 4,733 MW, due to come from geothermal.

(Editing by Ed Davies)