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Geothermal investments in Indonesia not meeting targets due to drilling delays

Drilling rig at Tulehu geothermal project, Maluku, Indonesia (source: SkyscraperCity)
Alexander Richter Alexander Richter 1 Nov 2018

Geothermal investments in Indonesia are lagging behind the government targets, mainly due to delays in drilling by Star Energy and Pertamina.

Investment into geothermal development to the third quarter 2018 was $850 million which is below the government set target of $1.2 billion, or around 70% less, so news from Indonesia today.

Director General of Renewable Energy and Energy Conservation (EBTKE) of the Ministry of Energy and Mineral Resources, Rida Mulyana, stated that the slow pace of geothermal investment was mainly due to a drilling delay by developers.

Drilling activities by both Star Energy and Pertamina have been delayed in several locations, and drilling is one of the most significant components of geothermal investment.

As Rida explained, there are several reasons that resulted in the drilling delay for both companies. In the case of Pertamina cleaning wellbores has been prioritized.

“Cleaning the wellbore is believed to be an effective technique for adding steam compared to doing new drilling,” he said last week at the Directorate General of EBTKE, Jakarta.

While the delay in drilling by Energy Star included three wells in the Wayang Windu geothermal working area. “For some reason, Star Energy has delayed drilling in Wayang Windu,” he said.

Previously, the Government targeted geothermal investment in 2018 to reach Rp. 23 trillion ($1.5 billion), up 64.28% compared to last year which was worth around Rp. 14 trillion ($922 million).

In a press conference with media in his office in March, Rida Mulyana said that the increase in investment in 2018 was related to the increasing number of national geothermal projects.

Rida added that the government had provided geothermal working areas to PT PLN (Persero) and PT Geo Dipa. This makes the number of geothermal projects that are rolling to increase. In addition, several existing geothermal projects have entered the exploitation phase.

“The recorded investment is carried out by 25 companies up to US $ 1.7 billion (equivalent to Rp. 23 trillion),” he said at the time.

Source: Panas Bumi News