CDB provides $473 million loan for 426MW Celukan Bawang Coal-Fired Power Plant Construction Project

CDB provides $473 million loan for 426MW Celukan Bawang Coal-Fired Power Plant Construction Project On July 31, 2013, China Development Bank (CDB) and PT General Energy Bali — a special purpose vehicle and project company that is jointly owned by China Huadian Engineering Co. Ltd. (51%), Singapore’s Merryline International Pte.

Ltd (38.49% ownership) and PT General Energy Indonesia (10.51%) — signed a $473 million loan agreement for the 3x142 MW Celukan Bawang Coal-Fired Power Plant Construction Project.

The proceeds of the loan were to be used by the borrower to partially finance an EPC contract between PT General Energy Bali and China Huadian Engineering Co. Ltd. According to CDB, $367 million was disbursed through this loan by the end of 2014.

The 426MW Celukan Bawang Coal-Fired Power Plant Construction Project was implemented as an Independent Power Project (IPP) and its total cost ($638 million) was financed with a mix of debt and equity.

The purpose of the project was to install a 426-megawatt (MW) coal-fired power plant — with three 142MW generators (Unit 1, Unit 2, and Unit 3) — in Gerokgak District, Buleleng Regency, Bali Province (exact locational coordinates: -8.1962945, 114.8515677). China Huadian Engineering Co. Ltd. was the EPC contractor responsible for implementation.

The project officially commenced on August 28, 2012. However, construction began on June 3, 2012. All three power generational units entered commercial operation on August 11, 2015. The originally anticipated commercial operations date (COD) of the project was October 30, 2014.

As of May 17, 2017, the power plant had generated 5.2 billion kilowatt hours, accounting for 40% of Bali's total power supply and allowing Bali to stop relying on power generation and supply from Java. However, this project was also plagued by controversy. China Huadian Engineering Co. Ltd. had multiple disagreements with local communities about land acquisition.

In December 2013, February 2015, and apparently on other occasions, local residents blocked the entrance to the construction site, complaining that some of the land being used on the project had never been fully acquired by China Huadian Engineering Co. Ltd. and still belonged to them.

Also, people displaced by the construction complained that they had not yet received title to the land that they were supposed to be given in compensation. China Huadian Engineering Co.

Ltd. was also criticized for failing to use local laborers — 90% of the construction workers on the site were apparently foreign workers and some of them were reportedly brought in without proper authorization. In December 2012, immigration officials seized the passports of 75 illegal foreign workers at the site.

In October 2012, members of the Buleleng Regency government threatened to shut down construction at the site until problems were resolved.

In April 2013, legislators from the Buleleng Legislative Council visited the construction site and found numerous violations, including use of heavy machinery without safety certificates and use of subsidized fuel in construction.