Monday, 6 September

Indonesian Geothermal Power Plant Contract to Tata Power and Origin Energy

I reported on 30 March on competition for a geothermal power project proposed for North Sumatra, Indonesia at Sorik Merapi. Tata Power, India’s largest integrated private power company, announced yesterday that the consortium comprising Tata Power (47.50 per cent), Origin Energy (47.50 per cent) and PT Supraco Indonesia (5 per cent) were declared as the successful bidder for the Sorik Marapi geothermal project in Northern Sumatra, Indonesia.

The Sorik Marapi project is estimated to support the development of approximately 240MW of geothermal generation capacity. The project will be developed by PT Sorik Marapi Geothermal Power, a special purpose vehicle formed by the consortium. The consortium would undertake a detailed exploration programme over the next 18 months. The expected commercial operation date for the project is June 2015. In bidding for the project the consortium beat out major foreign competitors, including Chevron and PT Medco Energi International.

Tata Power and Origin Energy are significant stakeholders in Geodynamics. The Sorik Merapi project provides a new vehicle for collaboration between the two companies in geothermal energy area. Sorik Marapi is a conventional geothermal resource similar to established operations in New Zealand, where Origin had experience through its majority-owned subsidiary Contact Energy.

Karen Moses, executive director, finance and strategy, Origin Energy, said, “The joint venture is consistent with Origin’s strategy of pursuing exploration opportunities for energy resources near growing markets. This joint venture is reflective of our belief that geothermal can provide large-scale renewable base load energy.” Tata Power said it has a ‘strong mission’ to achieve at least a quarter of its generation portfolio through renewable sources of energy by 2017, geothermal energy being one of the prime renewable growth engines. ‘The Sorik Marapi exploration is testament to our faith in the untapped potential of geothermal energy,’ said Menon.

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The picture shows a volcanic eruption that occurred at the end of last year on the mountain Berketinggian 2400 meters above the surface. The mountain is in North Sumatra and close to the Sorik Merapi geothermal field. Indonesia, which is within the extremely active seismic region called the Pacific Ring of Fire, is said to have a geothermal power-generating potential of about 27,000 megawatts, but the current installed geothermal capacity is only about 1200 MWe.

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