Two Power Plants to Be Built

SHANGHAI, China ~ Shanghai Electric Group, China’s largest power equipment group, will build two coal-fired power plants in Indonesia with a local partner, state press reported.

State-run Shanghai Electric and PT Truba Alam Manunggal Engineering of Indonesia have signed an arrangement for the construction of two plants, one of 250-megawatts and another of 50-megawatts, the Shanghai Securities News said on Tuesday.

According to the preliminary agreement, the two groups will jointly invest US$260 million in the plants in Sumatra, the newspaper said citing an announcement by Truba Alam.

Arifin Wiguna, the president of the Indonesia company, said each would contribute 30 percent of the investment, while the remaining 40 percent would be financed through bank loans.

Shanghai Electric Group declined to confirm the deal, the report said.

The group was in the headlines earlier this year for its involvement in Shanghai’s biggest financial scandal in years, involving speculative real-estate deals that felled the city’s top politician, Cheng Liangyu, in late September.

The group’s chairman and two other senior executives resigned in August due to allegations that they were connected to the corruption case.

Shanghai Electric said at the time that its operations remained unaffected.

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