PT Bhimasena Power Indonesia (BPI) will build a 2,000MW coal-fired power plant in Central Java, Indonesia, at an estimated cost of $4bn.
The company also signed a guarantee agreement with the Indonesian Government and the Indonesia Infrastructure Guarantee Fund for the public-private partnership scheme.
In addition, a 25-year power purchase agreement has been made with Indonesia's state-owned electricity company PT PLN to supply electricity generated from the project.
An engineering, procurement and construction contractor will soon be appointed for the project, which will employ Japanese advanced ultra-supercritical technology.
Financial closure will be completed next year, while construction is set to begin in October 2012 and commercial operations in 2016.
BPI has been established by Itochu Corporation, Electric Power Development and PT Adaro Power.