Japan agrees to lend US$943m to Indonesia power projects

The Japan Bank for International Cooperation (JBIC) has agreed to lend US$943m to two independent power projects in Indonesia.

The Bank has signed an agreement to loan US$729m to PT Paiton Energy for an 815MW expansion of a coal-fired project in East Java costing around US$1.5bn. Paiton currently runs a 1230MW coal-fired plant and has US$486m in loans from commercial banks including Bank of Tokyo Mitsubishi UFJ, BNP Paribas and Sumitomo Mitsui Banking Corporation. International Power and Mitsui each control 40.5 per cent of the Paiton stock with further shares held by Tokyo Electric Power (14 per cent) and PT BHP (five per cent). The project is envisaged to come onstream in early 2012.

JBIC will also lend US$214.2m to PT Cirebon Electric Power in West Java. The Marubeni-controlled coal-fired project has a design capacity of 660MW. Its execution will be funded by US$595m in total loans from a number of banks, including Sumitomo Mitsui Banking Corporation, Bank of Tokyo Mitsubish UFJ and Export-Import Bank of Korea. Start-up of the power station is scheduled for 2011. (Reuters)