Tata Power Co Ltd said on Friday it has agreed to sell its 50 per cent stake in a joint venture that is developing a geothermal power project in Indonesia for $30 million (about Rs 200 crore).
The Indian company held the stake in OTP Geothermal Pte Ltd through Singapore-based wholly owned subsidiary Tata Power International Pte Ltd. It has sold the stake to Singapore-based KS Orka Renewables Pte Ltd, Tata Power said in a stock-exchange filing.
OTP Geothermal is an equal joint venture with Australia’s Origin Energy Ltd and holds a 95 per cent interest in Indonesia’s PT Sorik Marapi Geothermal Power, which is developing a 240 MW Sorik Marapi Geothermal Power Project in North Sumatra.
Separately, Origin Energy said in a statement it has also sold its 50 per cent stake in OTP Geothermal to KS Orka for $30 million. The Australian company said the stake sale is part of efforts to reduce debt and narrow its focus to two core businesses–energy markets and integrated gas.
The Tata Power-Origin Energy venture had won the bid for the geothermal project in 2010.
Tata Power said the stake sale is consistent with its strategy to constantly review its businesses and restructure, as required. It said that the sale is subject to customary conditions precedent including approvals from Indonesian authorities and that it aims to complete the sale in next three months.
The company is one of India’s biggest private-sector power producers. It has has total installed generation capacity of 9,130 MW in India and also has operations in Singapore, South Africa, Australia and Indonesia.
The company first entered Indonesia in 2007 when it bought a 30 per cent stake each in two coal mining companies–PT Kaltim Prima Coal and PT Arutmin Indonesia—in a deal worth about $1.1 billion. It sold its stake in PT Arutmin in January 2014 to the local Bakrie family for around $500 millon.