Geo Dipa in planned geothermal holding for Indonesia
PT Geo Dipa Energi sees itself in a position to become the lead for the planned merging of three state-owned geothermal companies into one holding company in Indonesia.
In a take on the planned state-owned geothermal holding company, PT Geo Dipa Energi’s President Director Riki F Ibrahim states that the company is ready to become the parent of the geothermal holding company.
The plans for the holding company were announced last month in Jakarta and are to combine the geothermal subsidiaries of PT PLN, PT Pertamina and PT Geo Dipa.
Discussions are still going on and the plans are being analyzed by the Ministry of Finance (Kemenkeu) to achieve optimal goals for the country.
According to Rikki Ibrahim, there has been no decision yet on the leading entity for the holding and PT Geo Dipa has not received a mandate.
“We are ready, and (being) the holding company means that GeoDipa is increasingly busy in carrying out government assignments to reduce geothermal risks, and is also responsible for implementing PGE’s IPO,” explained Riki to Kontan.
Potential separate role for Geo Dipa?
He also noted that there is also a chance that Geo Dipa could be separated from PLN and Pertamina, but this is all speculation at this point. Importantly, he sees the need for Geo Dipa as a state-owned company to be unique and not in competition to the private sector. Furthermore, as a state-owned entity there is also the requirement to carry out government assignments, quickly and safely. With the set up of derisking geothermal working areas with government-driven drilling campaigns, this is indeed a valid point.
Riki also believes that the implementation of the planned initial public offering (IPO) of PT Pertamina Geothermal Energy (PGE) is “much more needed” at this point.
In addition, holding generally takes quite a long time, so it will be more profitable if the geothermal SOE companies are unified after the PGE IPO is realized, while simultaneously raising the asset value back.
“The target of PGE’s IPO is urgent now, (IPO is possible) this year if PGE is ready with the documentation,” he said.
Key role for PT Pertamina Geothermal Energy?
BUMN observer from the University of Indonesia (UI) Toto Pranoto assessed that among the three state-owned companies, PGE is considered potential enough to become the holding company for geothermal SOEs.
“Financial support, technology capacity, and access to the buyer market segment can also be considered [as option for PGE as the holding company],” said Toto to Kontan.
The benefits of holding a geothermal SOE are considered quite positive going forward. Moreover, Indonesia will later shift the use of national energy towards a more environmentally friendly or green energy direction .
Toto also reminded that investing in renewable energy requires a very large capex allocation, so the step to unite several companies into BUMN holding is considered the right step.
In addition, the holding of geothermal SOEs is considered capable of providing greater value, by providing value creation that will be created in the future. “The holding value will be greater than that of each BUMN to stand alone,” added Toto.
As for the source of value creation in the short term, according to him, it could come from operational efficiency measures ( cost reduction program ). Meanwhile, in the long term, the potential for sales to PLN could be greater, along with an expanded and more integrated network.
The Directorate General of New, Renewable Energy and Energy Conservation (EBTKE) of the Ministry of Energy and Mineral Resources, Dadan Kusdiana added that his party would support the holding of geothermal SOEs, as long as the aim was to further improve the performance of the use of new renewable energy (EBT), especially geothermal.