Indonesian gas service provider expands into electricity business

Publicly listed oil and gas services provider PT Radiant Utama Interinsco plans to build hydropower plants in West Sumatra to diversify its business.

Radiant’s subsidiary PT Supraco Mitra Energie will build three mini-hydropower plants in Solok, West Sumatra--the PLTMH Gumanti 1, 2 and 3.

The three plants have a $40 million price tag and a combined capacity of 15 MW.

Supraco plans to sell the electricity to state electricity company PLN, according to Supraco director Misyal Abdullah Bahwal.

Supraco will start construction of the $14.34 million PLTMH Gumanti 3 on 15 hectares near the Gumanti River in 2013, and  has signed a power purchase agreement with the branch office of PLN in West Sumatra for the 6.45-megawatt plant where PLN agreed to buy electricity for Rp 187.2 or 0.02 US cents.

“We were given one year to raise funds for the project after we signed the PPA. Construction is scheduled for completion in 24 months. We hope the plant will start operation in 2015,” said Misyal. 

Supraco is currently acquiring land for the plant while it negotiates with two banks to finance the project, Misyal said.

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