Gresik Power plant project delayed, Indonesia

PT Semen Gresik, says that the completion of its power plant project in Pangkep, South Sulawesi, will be delayed due to bad weather and man power limitations, according to reports in the Jakarta Post.

In a file submitted to the Indonesia Stock Exchange (IDX) on Tuesday, Semen Gresik said that its 2x35MW coal power plant would be completed by the second quarter of 2013, a delay from the initial target of the third quarter of this year.

"Extreme weather has hampered construction work, particularly in civil engineering, leading to delays in the mechanical and electrical works. The bad weather has also disturbed the delivery of materials. Moreover, the [available] workforce in the area is very limited," the company said in the statement.
Semen Gresik started construction on the power plant in 2009, aiming at ensuring an electricity supply for its cement plant in Sulawesi.

With the delay, however, the company said that the budget for the plant would likely go up by as much as 10 percent over the original estimate of US$114m, according to Semen Gresik corporate secretary Agung Wiharto.

"We haven't counted it all up yet. However, it will be between 5 and 10 per cent," Agung said, adding that higher spending on the plant would not disrupt Semen Gresik's operations.

The power plant is intended to supply Semen Gresik's recently completed Tonasa V cement factory, which would operate using electricity supply from state power company PT Perusahaan Listrik Negara (PLN) until the power plant was finished, Semen Gresik said. According to Agung, construction on the plant was 92 per cent complete at the end of August.

The firm's finance director, Ahyanizzaman, said that Semen Gresik was still considering building more power plants to guarantee Semen Gresik an independent and secure electricity supply. "However, it will depend on whether current electricity supplies [from PLN] are enough to support our factories," Ahyanizzaman said.