Adaro Unit Closes Financing Deal for Tabalong Power Plant
Jakarta. Adaro Energy, Indonesia's largest coal miner by market capitalization, announced the financial closure of a loan deal with six foreign lenders on Tuesday (24/01) for the construction of a 200-megawatt power plant project in Tabalong, South Kalimantan.
Tanjung Power Indonesia, Adaro Energy's unit that is developing the project, closed the $422 million financing deal with Korea Development Bank, the Bank of Tokyo-Mitsubishi UFJ, DBS Bank, Mizuho Bank, Sumitomo Mitsui Banking Corporation, and Hong Kong and Shanghai Banking Corporation (HSBC), which is also the lead arranger for the loan.
Adaro Power has committed $88 million in equity towards funding of the Tabalong project, estimated to cost $545 million. Tanjung Power Indonesia began construction of the project in June last year and plans to start commercial operations in the first half of 2019.
Adaro Power, a subsidiary of Adaro Energy, controls a 65 percent stake in Tanjung Power Indonesia, while the remaining shares are owned by EWP Indonesia, the local unit of South Korean utility firm Korea East West Power.
"We are thankful for the support from state-owned electricity utility Perusahaan Listrik Negara [PLN], all lenders, government institutions and other stakeholders. This will further cement our commitment to develop a power business for the future and create synergies with our coal business," Adaro Energy president director Garibaldi Thohir said in a filing to the Indonesia Stock Exchange (IDX).
The Tanjung Power project has signed a power purchase agreement with PLN in October 2014 to supply coal to the state electricity company for 25 years.
As a coal miner, Adaro wants to diversify its business to boost its power capacity to 20,000 megawatts by 203o and join the government's 35,000-megawatt power plant program.
Hyundai Engineering helped Tanjung Power Indonesia with engineering, procurement and construction in the project. Tanjung Power Indonesia will be responsible for the operation and maintenance of the power plant.
Adaro Energy's shares, which trade under the ADRO stock ticker, closed 0.58 percent higher at Rp 1,725 on Tuesday.
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