Jakarta. Indonesian state-owned coal miner Bukit Asam plans to start supplying electricity to Malaysia by 2020 following the completion of a coal-fired mine mouth plant in Riau – its first step to joining a region-wide power grid.

“We’re currently waiting for a feasibility study on the power plant in Riau,” Milawarman, the Bukit Asam president director, said at a conference in Jakarta on Monday. “If the feasibility study is approved and we receive approval from both the Indonesian and Malaysian governments, the assumption is that we can start building in 2017.

“This way, we will not only export just coal, but we can also export electricity, which is much greater in value,” he added.

The company expects to spend $1.8 billion to $2.4 billion on the new plant, but has not yet decided where it will get the funding from.

Once built, the plant in Riau’s Peranap district will be able to generate 800 megawatts to 1,200 megawatts of power, Bukit Asam says, possibly consuming up to six million tons of coal annually from the company’s mine nearby.

The plan is to transmit that electricity to Malaysia through an undersea cable in cooperation with Indonesian state-owned power monopoly PLN and Malaysia’s Tenaga Nasional, according to a joint development agreement signed in 2012.

Once it is transmitting to Malaysia, the company can swiftly tap into the planned Asean Power Grid, Milawarman said. The grid is an initiative dating from 1998 by the 10 member states of the Association of Southeast Asian Nations for an integrated regional power grid.

Total investment for the grid is estimated at $5.9 billion.

Milawarman said Bukit Asam hoped to secure regulatory approval for the power plant by the end of the year, citing possible competition from China, which is also looking to supply the region through the regional grid.