Wednesday, February 18, 2009 5:34 PM
Andi Hajramurni , The Jakarta Post , Makassar
South Sulawesi residents could soon have a reliable electricity supply and see an end to the LNG shortage, after an Australian energy firm said it would increase its investment in the province by building two power plants and an LNG plant.
Energy World Corporation Ltd, which owns PT Energy Equity Epic Sengkang and PT South Sulawesi LNG, will build two 60-megawatt power plants and an LNG plant, said Stewart W.G. Elliot, the company's managing director and CEO, after meeting Thursday with South Sulawesi Governor Syahrul Yasin Limpo.
Also in attendance was PT South Sulawesi LNG director of general affairs, Priandika Permana.
PT Energy Equity Epic Sengkang has already built two gas-fired power plants in Sengkang with capacities of 135 MW and 60 MW.
"We will build two more power 60-MW plants, bringing the total electricity generated to 315 MW," Elliott said.
The company will invest US$140 million in the two additional power plants. One is due for completion this year, while the other will be finished in 2010.
South Sulawesi is currently in the grip of an acute electricity crisis, with the Bakaru hydroelectric plant not generating to maximum capacity because of low water levels, resulting in rotating blackouts amid high electricity demand.
The company will also build an LNG plant in Keera, Wajo regency, 20 kilometers from its gas exploration area, for the gas-fired power plants.
The LNG plant is scheduled for completion in 2010 and should be operational by 2011.
"We have ordered all the equipment for the construction. Once the location has been cleared, we can start the construction," Elliott said.
The LNG plant, to be built on 35 hectares of land near Bone Bay and the nearby port, will cost an estimated $500 million, paid for in full by Energy World. The construction will be done by South Sulawesi LNG.
Priandika said the plant would have an annual capacity of between 2 and 5 million metric tons, to be shipped to Bali and Java. He added export possibilities were also being studied.
Governor Syahrul requested the company sell LNG directly to residents in the province to help ease the LNG shortage.
"When we get the LNG plant in our province, the residents should be prioritized before the gas is shipped to other provinces or exported," he said.
Elliott said he agreed with Syahrul's request as long as there was approval from the oil and gas regulatory body (BP Migas) and state-owned power firm PT PLN.
He also said the company would recommend PLN use gas rather than diesel to fuel its power plants
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