ADB Inks $92.6 Million Financing Deal for 83 MW Geothermal Project in W. Sumatra
Summary
Asian Development Bank or ADB announced Tuesday that it had inked a financing deal worth totaling $92.6 million (Rp 1.5 trillion) for a geothermal power generation project in West Sumatra.The international lender had signed the agreement with geothermal firm Supreme Energy Muara Laboh (SEML). About $38.8 million is set to be sourced from a syndicated ADB B Loan from Sumitomo Mitsui Banking Corporation with the former acting as the lender on record. The loans from the private financial institutions get covered by overseas untied loan insurance provided by Japanese insurance corporation NEXI.SEML will use the freshly secured funding to set up a 83-megawatt new geothermal plant on a site adjacent to an existing 85-megawatt unit that already entered commercial operation in late 2019.According to Sumitomo Corporation, the construction work for the second unit will begin this year. The estimated total project costs stand at approximately 70 billion yen or about $443.4 million.SEML has also signed a power purchase agreement with the state-run electricity firm PLN. The construction of an additional unit of up to 66 megawatt is also in the pipeline.The Muara Laboh geothermal project is backed by the Asia Zero Emission Community (AZEC) -- a carbon neutrality platform that brings together ASEAN members (except Myanmar), Japan, and Australia.The loan announcement came not long after Japanese Prime Minister Shigeru Ishiba paid a state visit to Bogor for some bilateral talks with President Prabowo Subianto.