MHI, together with Mitsubishi Electric Corporation and a local company have received an EPC (engineering, procurement and construction) full-turnkey order from PT. PLN (Persero), Indonesia's government-owned electricity company, to supply a 740 MW gas turbine combined-cycle (GTCC) power plant.

With the revival of the economy, the demand for electricity in Indonesia is increasing rapidly (approximately 6% p.a. or more) and in order to alleviate the electricity shortage which is expected to occur in 2005, the Indonesian government and PT.PLN have decided to pass an urgent order to MHI which has wide experience in supplying power plants in Indonesia.

The 740 MW GTCC power plant consists of two gas turbines, one steam turbine, and two heat recovery steam generators (HRSG) and will be constructed at Cilegon in Banten Province located 90 kilometers west of Jakarta, Indonesia. MHI will supply two M701F gas turbines, the first high-output, high-efficiency gas turbines in Indonesia, plus a steam turbine and two HRSGs as well as other peripheral equipment such as electric generators.

Operation of this power plant will be initiated in stages from 2005 to first half of 2006. This contract will be executed on a full-turnkey basis with a local company taking charge of civil engineering works, installation of equipment and associated transmission lines.

The funds for this project are under final negotiation between the Indonesian Government and Japan Bank for International Cooperation (JBIC), as well as Nippon Export and Investment Insurance (NEXI) as related to export credit.

The Cilegon area is the center of Indonesia's heavy and chemical industry with many steel plants and petrochemical plants operating in the area. In West Java, including Cilegon, demand for electricity is high and is growing continuously. To eliminate the concern over a future shortage of the electricity expected from 2005 onward, PT. PLN decided to build the new power plant at Cilegon, using PLN's own land and utilizing the available natural gas.