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Pertamina Geothermal Energy postpones development of Gunung Lawu geothermal project

Pertamina Geothermal Energy postpones development of Gunung Lawu geothermal project Mount Gunung Lawu, Indonesia (source: flickr/ sakuntala_stei, creative commons)
Alexander Richter 5 Mar 2018

Pertamina Geothermal Energy (PGE) has decided to postpone any possible development on the 110 MW Gunung Lawu geothermal project, due to challenges related archeological reasons and permitting.

Reported this morning, PT Pertamina Geothermal Energy (PGE), a subsidiary of PT Pertamina (Persero) focusing on geothermal business, decided to postpone the development of the Mount Lawu Geothermal Working Area (WKP). Non-technical issues become one of the main factors companies ultimately not make WKP area of 60,030 hectares (ha) as a development priority.

PGE Corporate Secretary, Tafif Azimuddin revealed there are two non-technical problems that challenge the weight of WKP Gunung Lawu. First, the existence of archaeological sites around the area of development sites.

“WKP Gunung Lawu is difficult, there are two big problems. One of them is related to archaeological finds, as the site features some temples” said Tafif when met at the Office of the Ministry of Energy and Mineral Resources (ESDM), (5/3).

Secondly , licensing from the local government is also certainly not going out because there are problems related to the archaeological site.

Tafif explained that PGE has received an official letter from regents of the Gunung Lawu working area, which contains a rejection of geothermal development in their region.

WKP Gunung Lawu is located in several districts namely Karanganyar Regency, Sragen Regency, Wonogiri Regency, Central Java Province and Ngawi Regency, Magetan Regency, East Java Province.

“What is clear is that we have been holding the letter of the regent that time we can not go in. Want socialization can not yet,” he said.

In the preliminary study, WKP Gunung Lawu Geothermal is projected to have an estimated reserve of 165 MW while PGE in its study plans to develop it with a capacity of 110 MW.

In fact, Tafif added, the management has prepared other options besides delaying the development of WKP Gunung Lawu by requesting the assignment of other geothermal WKP to the government.

PGE’s management still has to review the process of requesting other WKP assignments to new corporations then the corporation submits assignments to the Government.
“Well this if we do not postpone (delay) hell yes we ask to exchange it later another assignment,” he said.

Of course, WKP Gunung Lawu was awarded its management rights to PGE after a tender in 2016. At that time PGE successfully set aside PT Star Energy Geothermal Indonesia with a power supply price of $0.10/ kWh, while Star Energy offers $0.1447 / kWh.

PGE is one of the largest geothermal companies in Indonesia with total installed capacity reaching 587 MW. But the capacity will not last long because if PLTP Karaha Unit 1 has been operating then the installed capacity will increase 30 MW so that the total installed capacity reaches 617 MW.

Source: Kontan