Indonesia plans to build $1.8 bln power plant in Jakarta - minister

JAKARTA, April 8 Tue Apr 8, 2014 6:17am EDT

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JAKARTA, April 8 (Reuters) - Indonesia plans to build a coal-fired power plant with total capacity of 2,000 megawatts worth 20 trillion rupiah ($1.8 billion) in Jakarta, State-Owned Enterprises Minister Dahlan Iskan said on Tuesday.

Southeast Asia's largest economy is in desperate need of electricity as decades of under-investment in power projects and bureaucracy have led to frequent black-outs in offices and households.

Indonesia plans to add up to 60 gigawatts of electricity capacity to meet demand that is expected to roughly double by 2022, requiring a total of $125.2 billion in investment, an energy ministry official said last month.

The comment by Iskan to reporters on the sidelines of a media briefing came ahead of a parliamentary election in the world's third-largest democracy on Wednesday. The result will determine who can contest the July 9 presidential election, for which Jakarta Governor Joko Widodo is widely considered a front-runner.

State-owned logistics and industrial parks developer PT Kawasan Berikat Nusantara (KBN) plans to reclaim 100 hectares of land near the Tanjung Priok port in Jakarta, where the power plant will be built, KBN President Director Sattar Taba told reporters on the sidelines of the briefing.

Taba said he expects the project, which will be a public-private partnership, to take four years to complete and ground-breaking is slated for the first quarter of 2015.

Most of the funding for the project will come from a Chinese consortium, which will also be involved in building the plant, Taba said, declining to disclose specific names.

KBN may have a stake of up to 20 percent in the project, he said. The remainder of the shareholding structure is unclear.

"The need for electricity in Java is very high whereas supply is very low, so it is predicted that in 2017 there will be an electricity crisis if the plant is not built from now," Taba said. Jakarta, the Indonesian capital, is located in the densely populated island of Java.

($1 = 11,302.50 rupiah) (Reporting by Fathiyah Dahrul; Writing by Eveline Danubrata in SINGAPORE; Editing by Muralikumar Anantharaman)

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