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ITOCHU announces EPC agreement for coal-fired power plant in Indonesia

  • Aug 7, 2017
  • 602 views
Source: 
Asharq Alawsat

ITOCHU Corporation (headquartered in Minato-ku, Tokyo; Masahiro Okafuji, President & CEO; hereinafter ITOCHU) has announced that it has concluded an EPC (Engineering, Procurement and Construction) agreement for the construction of Kalselteng-2 coal-fired plant (South Kalimantan Province, Kalimantan Island, Republic of Indonesia; total capacity: 200 MW, hereinafter project) with Indonesias state-owned electric power company (hereinafter PLN) under the consortium that ITOCHU formed with major engineering companies in Korea and Indonesia, namely, Hyundai Engineering Co., Ltd. and PT. Truba Jaya Engineering.

The contract amounts to approximately US$400 million. The construction of the project has commenced and is expected to be completed in 2020.

This is an expansion project of the existing coal fired power plants (Units 1 to 4, 65 MW x 4 plants) located in South Kalimantan Province, Kalimantan Island, with the construction of Units 5 and 6.

It will contribute to reducing the environmental load by using the high-efficiency equipment for the Project which is comprised of the boilers manufactured by IHI Corporation and the steam turbine generators manufactured by Fuji Electric Co., Ltd.

To support Japanese companies export, Japan Bank for International Cooperation and MUFGs banking arm, The Bank of Tokyo-Mitsubishi UFJ, Ltd. (hereinafter, BTMU) will provide loans (approx. 16.9 billion yen and approx. US$89 million) to PLN as funds for the Project.

The loan provided by BTMU will be covered by insurance from Nippon Export and Investment Insurance.

In Indonesia, the demand for electricity is increasing constantly with the economic growing. In order to meet such forecast, Indonesia has been promoting the 35 Gigawatt Power Plants Development Plan. This Project is positioned as part of this programme.

ITOCHU has been actively promoting its power generation business in Indonesia and contributes to the stable supply of electricity as well by IPP investments such as the Sarulla Geothermal 320 MW IPP Project.

EPC business for the construction of power plants is one of important segments in ITOCHU and ITOCHU will continue to contribute to the economic growth of countries worldwide including Indonesia through its business activities in the power sector.

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