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International consortium pushing geothermal development on Flores Island, Indonesia

Signing the agreement on January 29, 2019 (source: EDSM)
Alexander Richter 31 Jan 2019

A new consortium is partnering with Indonesia's Ministry of Energy and Mineral Resources to accelerate geothermal development on Flores Island in East Nusa Tenggara Province in Indonesia utilising a slim hole approach with wellhead power plants.

Having followed the efforts by this international consortium from the sidelines, I am so glad for all involved that this is now official.

During a press conference yesterday in Jakarta, Indonesia, the Ministry of Energy and Mineral Resources announced a collaboration with an Eastern Indonesia Geothermal Consortium to accelerate geothermal development on Flores Island in East Nusa Tenggara Province (NTT).

The Eastern Indonesia Geothermal Consortium consists of North Tech Energy, Turboden SpA and SATE Ltd, which are interested in developing a geothermal field on Flores Island to meet electricity in the East Nusa Tenggara Province. The consortium’s collaboration with the Public Service Agency (BLU) in the ESDM Research and Development Agency is intended to facilitate the consortium’s investment in geothermal development and exploitation.

“The ESM Research and Development Agency can partner with Business Entities through Operational Cooperation (KSO) or Management Cooperation (KSM) to help accelerate geothermal investment,” said Head of ESDM Research and Development Agency, Sutijastoto, after the signing at the Ministry of Energy and Mineral Resources Office in Jakarta.

Currently the biggest economic development in NTT comes from the tourism, mining, marine and geothermal industries. There are 11 mineral mining companies in Manggarai Regency and need a large amount of electricity. One of them is processing manganese smelters, which require 10 MW of energy.

The biggest energy potential that can be utilized in NTT is geothermal energy of 1,276 MWe and 776 MWe of which are found on Flores Island. Therefore Flores Island is designated as a Geothermal Island, through the ESDM Ministerial Decree Number 2268 K / 30 / MEM / 2017. Of the 12 geothermal prospect areas, there are three regions that have obtained WKP (Geothermal Work Area) management permits from the Minister of Energy and Mineral Resources, namely Ulumbu, Mataloko and Sokoria.

The consortium took the initiative to develop geothermal potential on the island of Flores, using more efficient and inexpensive technology and methodologies, namely the technique of slim hole drilling in exploration and production drilling. For the production phase, the consortium will use turbines with wellhead turbine technology which is directly installed on top of the geothermal well. Turbine can be adjusted to the character of each well, both temperature and pressure.

This technology is right for small-sized geothermal fields and not too large electricity needs.

“We are looking forward pushing this approach of geothermal development forward in Indonesia, which allows for faster development with less environmental impact and the opportunity to expand development beyond large scale development … “, so Geir Hagalin, CEO of North Tech Energy, key driver for this new consortium.
The consortium is divided into two groups, namely the service provider group and the equity provider. Service providers consist of ISOR (Icelandic Geological Agency) and HIVOS. Icelandic ISOR is an experienced partner in mapping the subsurface, 3G data analysis, determination of drilling targets and assistance during drilling.

HIVOS is a Dutch international non-governmental organization whose role is to prepare communities in geothermal development locations.

HIVOS advertises preparation and training at the community level to form a business unit that utilizes electricity supply from geothermal energy and develops electricity-powered households.

The parties who are members of the equity provider are North Tech Energy (NTE) BV, Turboden SpA, EMO and Infunde Capital. NTE BV acts as a service provider and equity provider. Turboden SpA is a turbine producer with organic rankine cycle (ORC) technology, FMO (Dutch Government Development Bank) provides financing for geothermal development.

Infunde Capital acts as a geothermal field developer by coordinating all parties involved and ensuring all processes are in accordance with good business rules. RVO is an institution under the Ministry of Economic Relations of the Netherlands which plays a role in providing incentives to the private sector through Resource Risk Insurance.

Source: EDSM