Bangko Tengah power station

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Bangko Tengah power station is an operating power station of at least 1320-megawatts (MW) in Tanjung Enim coal mine, Muara Lenim / Lahat, South Sumatra, Indonesia with multiple units, some of which are not currently operating. It is also known as 华电玻雅电站, Sumsel-8 (SS-8).

Location

Table 1: Project-level location details

Plant name	Location	Coordinates (WGS 84)
Bangko Tengah power station	Tanjung Enim coal mine, Muara Lenim / Lahat, South Sumatra, Indonesia	-3.838679, 103.804133 (exact)

The map below shows the exact location of the power station.

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Unit-level coordinates (WGS 84):

• Unit 1, Unit 2: -3.838679, 103.804133
• Unit 3, Unit 4: -3.734, 103.759

Project Details

Table 2: Unit-level details

Unit name	Status	Fuel(s)	Capacity (MW)	Technology	Start year
Unit 1	operating	coal: unknown	660	unknown	2023
Unit 2	operating	coal: unknown	660	unknown	2023
Unit 3	cancelled	coal: unknown	660	unknown	–
Unit 4	cancelled	coal: unknown	660	unknown	–

Table 3: Unit-level ownership and operator details

Unit name	Owner	Parent
Unit 1	PT Huadian Bukit Asam Power [100%]	China Huadian Group Corp [55.0%]; PT Bukit Asam Tbk [45.0%]
Unit 2	PT Huadian Bukit Asam Power [100%]	China Huadian Group Corp [55.0%]; PT Bukit Asam Tbk [45.0%]
Unit 3	PT Huadian Bukit Asam Power [100%]	China Huadian Group Corp [55.0%]; PT Bukit Asam Tbk [45.0%]
Unit 4	PT Huadian Bukit Asam Power [100%]	China Huadian Group Corp [55.0%]; PT Bukit Asam Tbk [45.0%]

Project-level coal details

• Coal source(s): mine-mouth

Background

In March 2005, there was a high level meeting between China Huadian Corporation (CHD) officials and the head of the state-run electricity company, PT PLN. The following month CHD signed a Memorandum of Understanding with the governor of South Sumatra, Mr.Syahrial Oesman, for the development of a 4X600MW mine mouth power station in South Sumatra. A few months later, the formal Memorandum of Agreement was signed with the Indonesian President, Susilo Bambang Yudhoyono and Chinese vice premier Zeng Peiyan at a business luncheon. Signing the agreement were Mr. He Gong, the president of China Huadian Corporation, Mr. Eddie Widiono, the president director of Indonesian state-run electricity company PT PLN, Mr. Ismet Harmaini, president of Indonesian state-run coal company PTBA and Mr. Hendrik Tee, president of Indika. "This project is to be developed by 55% majority holding of China Huadian corporation," a CHD media release stated.

In March 2020, the project's sponsor declared force majeure and stated that development would be delayed as a result of the COVID-19 pandemic.

Phase I

In a 2009 investor presentation, PT Bukit Asam stated that the negotiation of a Power Purchase Agreement (PPA) with PLN "is in process" and stated that the commissioning date would be 2013. In its 2009 annual report Bukit Asam stated that the project was aimed at catering for demand in Java and Sumatra. However, the Power Purchase Agreement for the project has not been agreed to by PLN, the government-owned power company. An October 2010 JP Morgan research report referred to the project as having stalled. The plant was proposed to be built adjoining the Tanjung Enim mine.

In December 2011, PT Bukit Asam Tbk (PTBA), a state-owned coal mining company, announced plans to build the first two 660-MW units of the Bangko Tengah mine-mouth coal plant in Tanjung Enim, South Sumatra. The plant will be built by Bukit Asam with China Huadian Corporation; Bukit Asam has a 45% stake, while China Huadian has 55%. Construction was scheduled to begin in late 2012. The first unit of the plant was projected to operate June 2016, followed by unit 2 in September 2016.

According to a November 2013 report, the project backers were still seeking funding for the Phase I project, which was expected to cost US$1.59 billion. Representatives of Bukit Asam said that they were exploring a loan from a bank in China.

In 2014, PTBA stated that the Phase I project was in the final stages of financial closing, with financing expected to be finalized by the end of 2014. Construction would begin in 2015, and would last 36 months, with completion in 2018.

In March 2015, PTBA announced that it planned to sign the final cooperation agreement for the plant's construction in China by the end of the month. President Joko Widodo would accompany company representatives to China for the signing.

On March 27, 2015, Bukit Asam announced that it had finalized the terms for a $1.2 billion loan from the Export-Import Bank of China. The company stated that it has entered into a 25-year power purchase agreement with PLN, Indonesia's state-owned electricity company with Bukit Asam to supply 5.4 million tons of coal to Huadian Bukit Asam. Nikkei Asian Review reported that the loan would run for ten years, with a grace period of 45 months. With the loan covering 75% of the estimated $1.59 billion project, the balance of the costs are to be funded via equity. In its media release Bukit Asam stated that it is aiming to have the finances in place by the end of 2015 with construction to commence early in 2016. The plant has a target commissioning date of mid-2019.

On November 7, 2015, South Sumatra Governor Alex Noerdin conducted a groundbreaking ceremony at the project site.

In June 2016 and December 2016, it was reported that construction was expected to begin soon. However, on November 2, 2016, the Java-Sumatra HVDC Interconnection System, a HVDC (high voltage direct current) underwater line between Sumatra and Java, was placed on hold for at least two years. This line would have supported the transfer of 3,000 MW of capacity from three mine-mouth plants in Banko Tengah. Due to the delay of the HDVC line, the Bangko Tengah (SS-8) project is currently shelved while new power purchase arrangements are developed.

In January 2017, it was announced that the target construction date had been pushed back to 2022. PLN President Director Sofyan Basyir said that electricity from the mine mouth was originally to be delivered through undersea cable high voltage direct current (HVDC) from Sumatra to Java island. However, based on PLN’s calculation, the electricity reserve margin on Java Island is above 30%, while Sumatra has a deficit of more than 30%. Therefore, the electricity from Sumsel-8 will be delivered to Sumatra. In the 2018-2027 and 2019-2028 long-range plans, there are two units of 600 MW each listed for completion in 2022 and 2023, respectively.

In April 2019, there was a report that construction on Unit 1 began in Q3 of 2018, and another report that both units were under construction as of March 2019. In October 2019, construction of the two units was reported to be 25% complete. In July 2020 construction was reported to be 45% complete. In August 2020 it was reported that construction was expected to be 65% complete by the end of 2020 and that both units were scheduled to be commissioned in Q1 2022. As of January 2021 construction was 70% complete. In September 2021, the project was reportedly 75.6% complete and was expected to be commissioned in March 2022. In May 2022, construction was reported to be 96% complete.

As of July 2022, construction was ongoing.

As of October 2022, the power plant was expected to test commissioning in 2022 and start commercial operations in 2023.

In February 2023, the power station was yet to achieve commercial operation. In March 2023, local groups were urging the government to halt progress on the plant, citing that South Sumatra was already generating an excess of power.

In May 2023, the power station entered the "commissioning phase" (Google translate). Test operations for Unit 1 were expected to be complete in July 2023.

In August 2023, reporting stated that Bangko Tengah power station was expected to achieve commercial operation in September 2023.

In October 2023, listed with a capacity of 2 x 660 MW, the power station officially began supplying energy to the grid.

Phase II

The project had frequently been mentioned as a two-stage project, with two additional 660-MW coal-fired units slated to be built at a later date. However, PLN's 2015-2024 supply plan does not show these units. Nor does PLN's 2016-2025 supply plan mention the units. They appear to be abandoned.

Mine

In 2010, the China Railway Group (CRG) was awarded a US$4.8bn contract to build and operate a 307km coal railway line from PT Bukit Asam (PTBA)'s Banko Tengah coal mine in South Sumatra to Srengseng in Lampung province, Indonesia. The contract includes US$1.3bn for the construction of the railway and US$3.5bn for operating and maintaining the railway over 20 years. The project, which is scheduled to be completed in 2014, is slated to transport 27 million tons of coal per year. Business Monitor International reported that "the contract was awarded to the CRG by PT Bukit Asam Transpacific Railway, a joint venture (JV) company formed of PT Transpacific Railway Infrastructure (80%), which is owned by Indonesian tycoon Prajogo Pangestu, and PTBA (10%). The final 10% stake is owned by a Chinese railway company, although it is unclear from press reports if this stake belongs to China Railway Group or China Railway Engineering Corporation."

Financing

On March 27, 2015, Bukit Asam announced that it had finalised the terms for a $1.2 billion loan from the Export-Import Bank of China. Nikkei Asian Review reported that the loan would run for ten years, with a grace period of 45 months. With the loan covering 75% of the estimated $1.59 billion project, the balance of the costs are to be funded via equity. In its media release Bukit Asam stated that it is aiming to have the finances in place by the end of 2015.

In May 2018, Bukit Asam signed the US$1.26 billion bilateral loan with the China Export Import Bank to finance the development of the US$1.6 billion Sumsel 8 power plant. The loan, which is based on 75:25 debt-to-equity ratio, has a tenor of 15 years with a grace period of five years. Margin is reported to be 285bp over Libor. As part of the loan agreement, Bukit Asam and China Huadian Corporation agreed to provide US$390 million in equity. In March 2020, total investment in the project had reached US$1.68 billion.

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Additional data

To access additional data, including an interactive map of coal-fired power stations, a downloadable dataset, and summary data, please visit the Global Coal Plant Tracker on the Global Energy Monitor website.