A $130m hydroelectric power plant is being built in Indonesia for PT Wampu Electric Power.
It is the first private power project in the country to benefit from a business viability guarantee letter issued by the Ministry of Finance, under regulations introduced in 2011.
The 45 MW project also marks the first time that Korea Eximbank has financed a hydroelectric plant in Indonesia. The bank, along with Sumitomo Mitsui Banking Corporation, has put forward the $130m finance needed for the plant, which will be in North Sumatra and is due for completion in 2015.
PT Wampu Electric Power is owned by Korea Midland Power Co, POSCO Engineering and Indonesia’s PT Mega Power Mandiri.
Power from the plant will ultimately be sold to Indonesian state-owned utility Perusahaan Listrik Negara.
International law firm Norton Rose advised on the financing for the project, and Laurie Pearson of the firm’s Singapore office, said: “This was a highly complex transaction involving multi-jurisdictions.
“This is the first Indonesian power project to reach financial completion for over two years and represents another first with the involvement of the Korea Eximbank in a hydroelectric power project in Indonesia,” she added.