Indonesia power programme in doubt

JAKARTA, May 13, 2016 – Indonesian Minister of Energy and Mineral Resources Sudirman Said said on Friday that President Joko Widodo has called for review of the country’s plans to reach a power generation capacity of 35 GW by 2019, citing growing investors’ concerns about the feasibility of this target.

“He [Widodo] emphasised that there should be a thorough review while the deadline is still a long way off, so that we don’t encounter obstacles when we’re already halfway,” Said told the local press. According to the minister, state power company Perusahaan Listrik Negara’s tender processes, financing and management ought to be reviewed, among other aspects.

“Investors and businesspeople have started to question if we can finish this or not,” Said told reporters. Similar statements were earlier made by Michael D. Twomey, an adviser at SSEK Legal Consultants since 1992. “The government has said it wants to complete this in the next five years, which does not appear to be feasible due to the amount of time it takes to put a consortium together for a project, negotiate the PPA and obtain the land required for the power plant, obtain financing and acquire all the permits necessary to carry out a project,” Twoney told TOGY.

For more features and news about the oil and gas industry in Indonesia, click here.

Read our latest insights on: