Wayang Windu Power Project

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The initial contract for a 220MW facility at Wayang Windu was signed in December 1994 by Mandala Magma Nusantara (MMN), a joint venture between the local companies Figears and Oko Satrya Mandala. Both companies were owned by the ex-President Suharto's son Hutomo Mandala Putra, and the US's Magma Power. After California Energy and Magma Power merged, the contract's principal party changed to Asia Power Ltd, a subsidiary of New Zealand's Brierley Investments. Asia Power eventually took a 95% stake, with the remaining shares being held by the local Bumi Mandala Perkasa. The project was to sell electricity to a state-owned electricity company Parusahaan Listrik Negara (PLN). In 2000, Asia Power completed a 110MW unit but, because PLN was not prepared to pay the initial contracted sale price of $83.9/MWh, Asia Power was unable to repay its loans and the plant was handed over in 2001 to bank creditors, Credit Suisse First Boston and Deutsche Bank. The US's Unocal then took a 50% operating stake in the plant with the other 50% being retained by the banks. In 2004, Wayang Windu, still operating as MMN, was purchased by the local Star Energy in conjunction with Ashmore, a UK-based investment management company. A new contract was negotiated with PLN for the sale of electricity. The deal ran for a 30-year period and provided for up to 400 MW of total capacity at the site, including the operational 110MW unit. The contract was signed in November 2006. Standard Chartered became the financial advisor for the project in 2006 and sole arranger for a 110MW expansion project and subsequently for the refinancing of the existing unit. In February 2007, Standard Chartered Bank started syndicating a US$145million debt facility for the expansion of the Wayang Windu Power Plant. MNN was majority owned by Star Energy and remainder held by funds managed by Ashmore. The project carried government of Indonesia Support Letter. The government, through Ministry of Finance, was to provide PLN’s repayment obligation. The loan facility increased to US$305 million, and Sumitomo Corp was awarded an EPC contract. The US$305 million debt facility reached its financial close on May 3, 2007. In December 2008, Star Energy announced that construction of the second 110 MW unit was nearing completion and was to enter commercial operation by March 2009. Also in December 2008, Star Energy announced a further capacity expansion - units 3 and 4 - with an estimated combined cost of US$450 million. Units 3 and 4 were to expand plant capacity by as much as 280 MW, resulting in total plant capacity of 500 MW. Supply of electricity above the currently contracted 400MW was to be negotiated as part of an extension to the existing energy supply contract with PLN.