Power plants valued at $1B to rise in Sumatra

A consortium has been formed to  to build two 300-megawatt power plants worth around $1 billion on Indonesia's Sumatra island.

This is made up of Indonesia's PT Bumi Resources, DH Energy and South Korea's POSCO Engineering & Construction.

The consortium expects to conclude a power purchase agreement with Indonesian state utility PLN in the first quarter of 2012, according to Dileep Srivastava, a Bumi director. Murtaqi Syamsuddin, a director at PLN, confirmed the plans.

Coal miner PT Pendopo Energi Batubara, in which Bumi controls an 85 percent stake, will be the majority shareholder in the consortium. Pendopo has low-rank coal reserves of 1.9 billion tonnes.

DH Energy is affiliated to Bumi and Pendopo, while POSCO E&C is affiliated to steelmaker POSCO.

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