Standard Chartered Bank, acting as mandated lead arranger, financial advisor and sole underwriter, has signed a seven-year US$298.2mn financing for Magma Nusantara. The project financing facilities will be used to refinance and expand the Wayang Windu Geothermal Power Project in West Java, Indonesia.
Wayang Windu Unit 1 (110MW) was completed in 2000, and has an excellent operating track record. The project has proven to be a highly reliable and affordable source of electricity for PLN, the Indonesian electricity company. The project was acquired in late 2004 by Star Energy which has accelerated the development of Unit 2 (110MW). Sumitomo Corporation, which constructed Unit 1, will also construct Unit 2.
Wayang Windu is a landmark transaction for a variety of reasons. Financing Wayang Windu is a crucial milestone in developing Indonesia’s potential for renewable energy. Indonesia is estimated to have more than 20,000 MW of geothermal reserves of which only 800MW have been developed. Also, Wayang Windu is the first new integrated power plant in Indonesia to be financed since the Asian financial crisis in 1997.
In the first phase of syndication, a small number of relationship banks joined the Unit 2 financing. In the second phase, Indonesian and international banks will be invited to participate in both Unit 1 and Unit 2 facilities.