Jakarta, April 18, 2008 (ANTARA) - PLN signs five long-term IDR portion credit facilities totaling IDR5.7tn (equivalent to approx USD627m) with bilateral and syndicates of Indonesian banks in support of the local currency portions for development of new coal fired steam power plants in Suralaya, Paiton, Labuan, Indramayu and Rembang.
Today's Loan Agreement signing follows the two USD buyer credit facilities concluded in January 2008 with China Exim Bank and represents a significant and continuing progress in the fund raising exercise for the Fast Track Program. The IDR loans are supported by a government guarantee from the Ministry of Finance and are the first PLN's long-term local currency funding to be concluded on a bilateral or syndication basis with banks since 1995.
Bank Mega (for Suralaya and Paiton) is acting as the bilateral (sole) creditor, and each of BCA (for Labuan), BNI (for Indramayu) and Bank Mandiri (for Rembang) is acting as the Coordinating Arranger and Lender in the respective projects. BCA, BNI and Bank Mandiri are involved in each other's consortium, while Bank Rakyat Indonesia is also participating as a co-lender in those bank groups. In concluding this financing, PLN is being advised by HSBC as Financial Advisor and Hadiputranto, Hadinoto & Partners (HHP) as Legal Advisor.
The facility amounts for each of the projects are the following:
Today's Loan Agreement signing follows the two USD buyer credit facilities concluded in January 2008 with China Exim Bank and represents a significant and continuing progress in the fund raising exercise for the Fast Track Program. The IDR loans are supported by a government guarantee from the Ministry of Finance and are the first PLN's long-term local currency funding to be concluded on a bilateral or syndication basis with banks since 1995.
Bank Mega (for Suralaya and Paiton) is acting as the bilateral (sole) creditor, and each of BCA (for Labuan), BNI (for Indramayu) and Bank Mandiri (for Rembang) is acting as the Coordinating Arranger and Lender in the respective projects. BCA, BNI and Bank Mandiri are involved in each other's consortium, while Bank Rakyat Indonesia is also participating as a co-lender in those bank groups. In concluding this financing, PLN is being advised by HSBC as Financial Advisor and Hadiputranto, Hadinoto & Partners (HHP) as Legal Advisor.
The facility amounts for each of the projects are the following:
| Projects | MW | IDR Loan |
| Suralaya | 1 x 625 | 735,387,524,690 |
| Paiton | 1 x 660 | 600,635,738,985 |
| Labuan | 2 x 315 | 1,188,548,523,036 |
| Indramayu | 3 x 330 | 1,272,913,654,892 |
| Rembang | 2 x 315 | 1,911,480,000,000 |
| Total | 3,535 | 5,708,965,441,603 |
The facilities carry a 10-year door-to-door tenor including up to 3 years of drawdown period and grace period, consistent with the construction tenor of the power plants and long-term nature of the assets. The large funding amount for the 5 projects is an evidence of the strong support the domestic bank market is providing to the success of the Fast Track Program. The local banks are expected to provide further support for future projects under the 10,000 MW program.
With today's signing, Suralaya and Paiton projects will be fully funded. The next focus will be on concluding the USD funding for Indramayu, Rembang and Labuan. A facility agreement with Bank of China consortium in support of Indramayu is expected to be signed at the end of the month in China, while Rembang USD facility is currently in documentation phase with Barclays/China Development Bank consortium.
The projects being supported by the IDR loans are part of a total of 10 new power plants in Java. The plants will provide a total of 3,535 MW of new electricity generation capacity for the Java-Bali grid and are targeted for commissioning in 2009 and 2010.
The success of obtaining these long term loans reflects high level of confidence from domestic banks to support the development of electricity infrastructure in Indonesia. It can then be assured that such loans conclusion will smoothen the financings of the 10,000 MW Fast Tack Program. Strong support from the Government of Indonesia through the issuance of full guarantee by Ministry of Finance for PLN borrowings should highlight the importance of the Fast Track Program for Indonesian economy.
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