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nergy and mining contractor Dian Swastatika Sentosa (DSSA), part of the Sinar Mas Group conglomerate, will allocate up to US$200 million in capital expenditure this year, most of which will go to its power plant business.

DSSA corporate secretary Hermawan Tarjono revealed that the company had set aside up to $140 million to build coal-fired power plants, while the remaining $60 million would be spent to finance other businesses.

'€œThis year we will mainly focus on working on our [South Sumatra] power plant PLTU Sumsel-5 and preparing for [Southeast Sulawesi] power plant PLTU Kendari,'€ Hermawan said.

The South Sumatra plant, as previously reported, is expected to start operation in November this year. The power plant, with a total investment of around $400 million, has a capacity of 2x150 megawatts (MW).

DSSA also announced on Friday that it had set up a new subsidiary based in Southeast Sulawesi to manage its upcoming $200 million power plant project in the province.

Through a statement published on the Indonesia Stock Exchange (IDX) website, DSSA '€” through its wholly owned subsidiaries DSSP Power Sakti and DSSE Energi Mas Utama '€” established last Wednesday a new entity called DSSP Power Kendari.

The authorized capital for the new entity was $200 million, while the paid up capital was $60 million, the statement added. Hermawan said the new entity was established to anticipate a future project in the area.

'€œThe new company was established to manage the PLTU Kendari 3 power plant with a capacity of 2x50 megawatts,'€ Harjono said, adding that the project was estimated to cost between $150 million and $200 million.

'€œThe construction is expected to start in 2016 and might take around four years to round up,'€ he added.

The Sumsel-5 and Kendari-3 power plants will enrich the business portfolio of DSSA, which currently operates four power plants.

Two of DSSA'€™s power plants are located in Tangerang and Serang, Banten, and the other two are in Karawang, West Java. They have a total power capacity of 300 MW.

Hermawan added that the company was looking for other business opportunities now that the new government had pledged to boost the country'€™s power supply.

'€œWe are open to any other opportunities to work on new plants offered by [state-run electricity company] PLN,'€ he said.

Meanwhile, in an official announcement published on Monday, DSSA announced that Singapore Exchange Securities Trading Limited (SGX-ST) had last week granted consent for Singapore-based forestry firm United Fiber System Limited (UFS) to acquire DSSA coal mining unit Golden Energy Mines (GEMS).

The realization of the acquisition will take place in three months pending several requirements that must be met by both parties.

DSSA announced in 2012 that the company planned to exchange all of its 67 percent stake in GEMS with a 92.77 percent controlling stake in UFS in a reverse takeover plan, to facilitate the power supplier to enter the Singaporean bourse through a back-door listing. The share swap transaction is estimated to hit Rp 1.5 billion in value.

DSSA said it had scheduled a general shareholders meeting in April to obtain approval for the transaction, and had agreed with UFS to give more time to the transaction to facilitate both parties in meeting several terms in their Shares Purchase Agreement.

The deadline is extended from March 31 to June 3.