Bidders emerge on delayed Java 1 bid
Several bidders have emerged for the $2 billion 2x800MW Java 1 gas-fired combined-cycle power and floating storage project in Indonesia, IJGlobal can exclusively reveal
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Sign InSeveral bidders have emerged for the $2 billion 2x800MW Java 1 gas-fired combined-cycle power and floating storage project in Indonesia, IJGlobal can exclusively reveal.
Indonesia’s state-owned utility PLN recently pushed back the deadline to submit bids again, by another month to 25 August. PLN has delayed the bid submission deadline twice so far, each time by a month.
Bidders for the project are understood to be:
- Indonesia’s Adaro and Sembcorp, advised by DBS
- Marubeni and Indonesian oil and gas firm Pertamina, advised by ING
- Mitsubishi Corporation and PLN subsidiary PTP, advised by MUFG
- Indonesia’s Medco has replaced its original partner, Mitsui & Co, with Qatar’s Nebras and Korea Electric Power, according to local press reports. Medco is understood to have retained SMBC as financial adviser.
The deadline was widely expected to be delayed as sponsors and their advisers scrambled to amend the original contracts prepared by PLN and its advisers, Ernst & Young's Jakarta office and a local law firm.
One issue was the allocation of the LNG procurement risk. PLN informed the potential bidders in May that it will take care of sourcing and allocating the LNG for the two power plants and floating storage facilities. PLN then however drafted contracts with clauses that in effect transferred the procurement risk to the sponsors, according to sources close to the negotiations.
That issue has now been resolved and only minor problems with the contracts are now pending, another source told IJGlobal this week.
PLN’s decision to procure the LNG itself is in line with the Indonesian government’s policy to use as much of the gas produced in Indonesia as possible. “The government position is that gas supply will be provided by Tangguh LNG – we want to ensure that where there is domestic supply, we use it,” Agung Wicksono, vice-chairman of Indonesia’s Ministry of Energy and Mineral Resources told IJGlobal in May.
BP has announced its final investment decision for the $8 billion Tangguh LNG expansion project but financial close is not expected to be achieved for a few months. PLN will be the offtaker for the Java 1 project under a 25-year power purchase agreement (PPA). PLN has tendered the project without a government guarantee for its obligations under the PPA.
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Snapshots
Tangguh LNG Expansion
- Financial Close:
- 14/12/2016
- Value:
- $3,745.00m USD
- Equity:
- $0.00m
- Debt:
- $3,745.00m
- Debt/Equity Ratio:
- 100:0
Java 1 FSRU & CCGT Power Plant (1760MW) IPP
- Financial Close:
- 18/10/2018
- SPV:
- Jawa Satu Power (JSP) /Jawa Satu Regas (JSR)
- Value:
- $1,775.00m USD
- Equity:
- $463.00m
- Debt:
- $1,312.00m
- Debt/Equity Ratio:
- 74:26
- Concession Period:
- 25.02 years
Snapshots
Acquisition of Some Company
- Value:
- $9,838.26m USD
- Equity:
- $9,838.26m
- Debt:
- $0.00m
- Debt/Equity Ratio:
- 0:100