Tanjung Jati B Coal Plant Units 1-4

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The Tanjung Jati B coal-fired plant was a 1,320-MW (2x660-MW), US$1,800 million generation facility. Tanjung Jati B Coal-Fired Power Plant was distinct from the proposed Tanjung Jati A project also to be located in the Jepara Province, Central Java. The project originally belonged to the portfolio of the Hong Kong-based Hopewell Holdings' Consolidated Electric Power Asia (CEPA), through its local subsidiary, PT CEPA. Hopewell Holdings signed a 30-yr PPA with Perushaan Listrik Negara (PLN) in September of 1997. PT Bentala Coal Mining and PT Adaro Indonesia agreed to supply coal for the project. The project was temporarily halted after the East Asian economic crisis hit beginning in 1997. The project ran into difficulties as CEPA fell out with its original joint-venture partner, faced political pressures to reduce tariffs, and was unable to secure financing. Hopewell and the Government of Indonesia decided to cancel the project in 1997. Construction had been started using US$430 million of the sponsors' funds. Southern Electric bought 99.9% of CEPA, but decided not to take Tanjung Jati B Coal-Fired Power Plant because of the political and financial problems of the project. Sumitomo Corp. [Japan] resumed construction in November 2001 with a completion date set for 2004. Under a 20-year build-lease-transfer contract, Sumitomo bought out CEPA and sponsored the project via a special purpose vehicle, Central Java Power (CJP). In October 2006, CJP began leasing the completed power plant to PLN, which operated it. As a result, CJP's revenue came from lease payments made by PLN. In 2003, the project secured fresh financing from JBIC and a group of commercial banks that included Bank of Tokyo-Mitsubishi, BNP Paribas, Shinsei Bank, SMBC and Sumitomo Trust & Banking. EXPANSION PT Central Java Power (CJP) was developing units 3 & 4 of the Tanjung Jati B plant, an expansion of the existing Tanjung Jati B coal-fired power plant. The greenfield, 1,320 MW (2 X 660 MW) expansion plant was developed on a build, lease and transfer basis. Under the 20-year BLT contract signed on Nov. 4, 2008, Sumitomo [Japan] sponsored the project via its special purpose vehicle, Central Java Power (CJP). CJP was to lease the power plant to the state-owned electrical utility, Perusahaan Listrik Negara (PLN), which was to operate it. As a result, CJP's revenue was to come not from offtake payments, but from PLN's lease payments. Tanjung Jati B – Units 3 & 4 is located beside the existing 1,320 MW Tanjung Jati B – Units 1 & 2, in Tanjung Jati, Jepara province. In March 2007, Sumitomo Corp. issued a request for proposals (RFP) for the arranger role to lead the financing for the expansion of Tanjung Jati B. The expansion was to be undertaken by Central Java Power, the same project company that undertook units 1 & 2 of the Tanjung Jati B plant. The US$2.2 billion project reached financial closure on Dec. 25, 2008, with an 80:20 debt-equity ratio. The total debt of US$1.75 billion comprised a US$1 billion (96 billion Japanese Yen [JPY]) direct loan from Japanese Bank for International Cooperation (JBIC) and US$ 750 million (JPY 64 billion) in covered debt provided by three commercial banks: Bank of Tokyo-Mitsubishi; BNP Paribas; and SMBC. The covered debt was syndicated among Calyon, Mizuho, Shinking Central Bank and Sumitomo Trust and Banking. The commercial banks’ debt was covered by a JBIC-provided extended political risk guarantee that also covered PLN's payment obligations. The tenor on the debt was 16 years door-to-door, including four years' construction. An umbrella note signed between JBIC and the Indonesian Ministry of Finance (MoF) specified that the ministry would support PLN's payment obligations to the project company, although the ministry did not issue an explicit payment guarantee. Construction was to start in first quarter of 2009, the plant was commissioned in December 2011 - earlier than expected (2012). http://www.tjbservices.com/tjb_about_us.html