September 07, 2008

NTPC plans coal and power JV with PT Tambang Batubara

It is reported that National Thermal Power Corporation may enter into a power and coal JV with an Indonesian company as part of its initiative to expand global operations and secure coal linkage for its power plants.

As per reports, NTPC in talks with Indonesian mineral company PT Tambang Batubara Bukit Asam Tbk for entering into a JV where NTPC would help the company in its proposed power foray and also jointly mine coal for use by the PSU. NTPC officials have already met PT Tambang Batubara representatives in Indonesia in September 2007.

The report cited a source in the ministry of power as saying that “A delegation from NTPC is expected to visit Indonesia soon to hold final discussions with PT Tambang Batubara for a possible joint venture. If the talks succeed, the two sides could sign a MoU for development of a thermal power plant and a coal mine.”

As per report, NTPC is interested in setting up 2 JV operations with PTBA, 1 for providing engineering support for developing a power plant and another for developing a coal mine that would allow NTPC to bring a portion of the production for use in its power plants.

PTBA is the sole state owned coal mining company in Indonesia and owns 2 of the largest coal mining sites Tanjung Enim and Ombilin. It produces over 10 million tonnes of coal annually, 25% of which is exported to countries such as Malaysia, Taiwan and Japan. PTBA has recently won tender for constructing a power plant and has indicated that it would grow this business.