By Cepi Setiadi
PT Kayan Hydropower Nusantara (KHN), the developer behind the Mentarang Induk Hydroelectric Project (MIHEP), is targeting financial closing by the first quarter of 2026 for the 1,375 MW hydroelectric project in Malinau, North Kalimantan. YB Andhi Marjono, Director of KHN, announced that the project is currently 5% complete.
“We plan to accelerate work starting mid-year, aiming for a 2030 target for Commercial Operation Date (COD). We are hopeful of achieving financial closing by early next year,” Andhi stated during a media discussion on March 19.
Following the groundbreaking ceremony on March 1, 2023, led by then President Joko Widodo, the project has focused on preparatory work, including the completion of access roads. The next step will be appointing an Engineering, Procurement, and Construction (EPC) contractor to build a diversion tunnel. "We’re now preparing for the construction of the main tunnel and expect to proceed at full speed by mid-year," Andhi added.
The project will feature a Concrete Faced Rockfill Dam (CFRD) with a dam crest height of 235 meters and a crest length of 815 meters, covering a reservoir area of about 200 square kilometers. Once complete, the hydroelectric plant will be one of the tallest dams globally, with an installed capacity of 1,375 MW from five turbines (5x275 MW), generating around 9 Terawatt-hours (TWh) annually. The electricity produced will help power the Kaltara Industrial Park in North Kalimantan.
“The CFRD will be constructed using locally available rockfill, making construction more cost-efficient,” Andhi explained. The total investment for the project is estimated at $2.7 billion (around Rp 45-50 trillion), covering both the dam and the required transmission infrastructure. Given the distance from the project site to the industrial park, significant transmission lines will be needed.
Read also : KHN targets financial close of hydro power project in Q4 next year
Environmental and social considerations
KHN has also addressed environmental concerns associated with the project. Andhi noted that the project underwent an assessment by the International Hydropower Association (IHA) in 2021. “We are committed to meeting the Hydropower Sustainability Standard. Of the seven areas for improvement identified in the assessment, we have resolved four. The remaining three are minor issues concerning relocation, biodiversity, and public transparency,” he shared.
The company is actively involving the local community in the relocation process. “We are conducting surveys to understand local livelihoods and assets to ensure the relocation process aligns with the community’s aspirations,” Andhi said. The study is expected to be completed by mid-year.
To address biodiversity concerns, KHN has incorporated findings from the 2023 Environmental Impact Assessment (AMDAL). “The IHA has recommended extending some assessments, so we’ll implement a Biodiversity Action Plan (BAP) by mid-year to comply with international standards,” Andhi added.
KHN is also preparing a biodiversity offset plan for the Malinau area. “We’re in discussions with the Mentarang National Park Authority and the East Kalimantan Natural Resources Conservation Agency (BKSDA),” he said.
Regarding endangered species, Andhi clarified that no such species have been identified in the project area so far. "Based on our studies, we don’t expect to find endangered species in the area. However, we can relocate species like pangolins (Trenggiling) if needed,” he said. “Our principle is clear: only sustainable and responsible hydropower is acceptable. This is the approach we’re implementing to ensure we meet all standards and achieve financial closing.”
Editing by Reiner Simanjuntak
