BKMS and PLN Signed 170 MVA Power Purchase Agreement to supply Power to PT Freeport Indonesia Smelter in the JIIPE SEZ
March 14, 2022
JAKARTA, March 14, 2022 – PT Berkah Kawasan Manyar Sejahtera (BKMS), a subsidiary of PT AKR Corporindo Tbk (IDX stock code: AKRA.IJ), and PT PLN Persero (PLN) today signed an Power Sale Purchase Agreement (PJBTL) for supply of 170 MVA required by PT Freeport Indonesia Copper Smelter being built in SEZ JIIPE Gresik.
The signing ceremony held today at PLN Headquarters was attended by representatives from the Coordinating Ministry for the Economy, Ministry of Industry, Ministry of Energy and Mineral Resources Rida Mulyana ,Msc; Gresik Regent, Mr. Elen Setiadi, Secretary General of the SEZ National Council, Mr. Bob Syahril - Director of Commerce and Customer Management of PLN, Mr. Haryanto Adikoesoemo - President Director of AKRA, Mr. Bambang Soetiono-President Director of BKMS, Mr. Tony Wenas – President Director of Freeport Indonesia along with the senior management of PLN, AKRA, BKMS, Pelindo, PTFI and other departments.
Purchase Power Agreemnt Signing Event between PLN and PT BKMS to Serve PT Freeport Indonesia
PT BKMS holder of an Electric Power Supply Business License for the business area in JIIPE will get supplies of power from PLN on an ongoing basis of 150 kV (one hundred and fifty kiloVolts) High Voltage Supply with a total power of 170 MVA (one hundred and seventy Mega Volt Ampere) which it will distribute and sell to PT Freeport Smelter; On this occasion, PT BKMS also signed a back to back agreement with PT Freeport Indonesia to distribute and resell Power; this is expected to generate recurring income for KEK JIIPE Gresik.
The PPA which is owned by PT BKMS stated that PLN will distribute and sell electricity to BKMS, on an ongoing basis through the PLN 150 kV (one hundred and fifty kiloVolts) High Voltage Supply with a total power of 170 MVA (one hundred and seventy Mega Volt Ampere). On this occasion, PT BKMS also signed a back to back agreement with PT Freeport Indonesia in which PT BKMS will distribute and resell Power connected to PTFI according to their needs, so that this will generate recurring income for KEK JIIPE Gresik.
In his remarks on behalf of the President Director of PLN, Mr. Bob Syahril as the Director of Commerce and Customer Management said "PT PLN is ready to serve with international standard reliability, we will add more power plants and backbone networks so that there will be several alternative supply in accordance with the agreement. We are ready to supply electricity to PTFI's smelters from the substation.”
Mr. Bob Syaril also added “We offer competitive prices. This is supported by a network that is quite strong and also a sufficient supply of excess so that approximately 6.5 Gigawatts are available.”
Mr. Bambang Setiono as the President Director of PT BKMS gave a speech "Today we can together in this place to witness the signing of the Cooperation between PT Freeport and PT BKMS and PT PLN with PT BKMS until there is a mutual cooperation that we really hope for Cooperation between SOEs. We really hope for support from PLN so that we can continue the next collaboration. We believe that thanks to the support of Mr. Elen, we have obtained the SEZ and now quite a number of people have contacted us and we are very aggressive in contacting prospective tenants.
Director of PT Freeport Indonesia Mr. Tony Wenas also gave a speech "We hope that the construction of the largest single line copper smelter project in the world can run as it should according to the target" Mr. Tony Wenas also added "We hope that all parties can support this project, which is one of the barometers for mineral downstreaming in Indonesia, so that what Mr. President hopes is the emergence of other downstream industries as derivatives of cathode copper, gold and silver can grow not only in JIIPE but also in other parts of Indonesia”.
Representing the Government in this case the Ministry of Energy and Mineral Resources, Mr. Rida Mulyana, Msc Director General Electricity said that “Issuance of this business license is to ensure that the electricity supply meets adequacy, reliability, sustainability, affordability in terms of price, and also the flow meets the elements of justice. According to Consitution No. 11 of 2020, Business license holders (BKMS and PLN) have 4 obligations: 1) must provide electricity that meets applicable quality and reliability standards, 2) provide the best possible service, 3) meet electricity safety requirements, 4) prioritize domestic products or potentials”
Speaking after the signing ceremony, AKRA's President Director, Mr. Haryanto Adikoesoemo, stated, “Today is another important milestone for the JIIPE SEZ and the PTFI Copper Smelting Project. The signing of the SPJBTL shows how the JIIPE SEZ facilitates tenants by providing all the tenants' utility needs, port facilities and the benefits of Special Economic Zones. The PTFI project has been designated as a National Strategic Project and JIIPE SEZ Management is working closely with the PTFI team to ensure that this project will be completed on time.”
“The JIIPE SEZ is currently experiencing an increase in investor interest in land and other services available in the JIIPE SEZ. This is expected to encourage new land sales in the near future. The revenue generated from this agreement will be used to develop infrastructure at JIIPE and provide value to AKRA shareholders”.
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