Singtel Teams With Telkom, Medco to Build 51MW Data Centre in Indonesia’s Batam

Singaporean telecom major Singtel has entered Indonesia’s data centre market, joining forces with longtime partner Telkom and energy firm Medco Power to develop a 51-megawatt hyperscale campus in Batam, across the Singapore Strait from the island city-state.

The three companies held a groundbreaking ceremony last week for the project at Kabil Industrial Estate along Batam’s eastern seaboard, Singtel said in a release. The campus will be developed in three phases on an 8 hectare (19.8 acre) site, with the initial phase delivering 20MW of capacity.

Singtel’s strategic partnership with the two Indonesian firms comes after the Temasek-controlled group in April signed a memorandum of understanding with Jakarta-based Telkom to set up a platform to build and acquire data centres throughout ASEAN.

“As Southeast Asia’s largest digital economy, Indonesia is core to our expansion plans into high growth markets,” said Andrew Lim, chief commercial officer of Singtel’s regional data centre business. “Our track record in designing, building and operating data centres, combined with Telkom and Medco Power’s deep expertise in their respective fields, will prove a powerful partnership.”

Growing Regional Footprint

The greenfield data centre on the island less than 40 kilometres (25 miles) from Singapore will draw on dual-source electricity, including clean, renewable energy from Medco Power, Singtel said. The asset will be majority-owned by Telkom, while Singtel and Medco Power will be minority shareholders.

Indonesia is the third market for Singtel’s data centre division, which is developing a 20MW facility in Thailand with local partners Gulf Energy and AIS, as well as a project in western Singapore’s Tuas area. Both data centres are expected to begin operations by 2025.

The regional data centre platform builds on the more than 20-year relationship between Telkom and Singtel, which holds a 35 percent stake in Telkom’s mobile unit Telkomsel.

Telkom has an existing portfolio of 27 data centres in Indonesia and the region, and selected data centre assets from the portfolio will be placed in the platform with Singtel. The companies are also collaborating on development of new projects and exploring opportunities for third-party investors and partners to participate in the platform.

Cross-Strait Connectivity

In Cushman & Wakefield’s APAC Data Centre Update released last week, the property consultancy tabbed Batam as a market of opportunity for data centres in view of limited supply and a recent development moratorium restricting growth in nearby Singapore.

“With its location, ample land capacity and rich connectivity to Singapore, Indonesia and other parts of the world, Batam is expected to experience increasing investment spill-overs as a result of land and power constraints in neighbouring markets,” Singtel’s Lim said. “Jointly developing a best-in-class hyperscale data centre in Batam will provide regional customers with a strong alternative.”

Batam’s Nongsa Digital Park marks the spot of the maiden project for Data Center First, a Southeast Asian development platform backed by Hong Kong-based Gaw Capital and helmed by Keppel Data Centres veteran Wong Ka Vin. The 30MW facility is due to enter service in the fourth quarter of 2023.

On the island of Java, meanwhile, the fast-growing Jakarta market continues to lure data centre developers, with BDx Indonesia announcing plans last month to develop a 100MW campus as the operator’s fifth server-hosting facility in and around the capital.

In October, US giant Equinix disclosed that it would build a $74 million co-location facility in central Jakarta. The eight-storey development, scheduled to open by the second half of 2024, will provide more than 1,600 cabinets and over 5,300 square metres (57,049 square feet) of co-location space when fully built.