Indonesian Ministry of Energy to improve geothermal data quality to attract investment

Drilling rig on site of Baturaden project, Central Java (source: PT SAE)
Alexander Richter 14 Apr 2020

The Indonesian government is pushing for better quality of geothermal data to attract investments targeting own government driven exploration drilling and data acquisition.

The Ministry of Energy and Mineral Resources (ESDM) has announced that it will improve the data quality for geothermal energy. It is hoped that this will attract EBT investment.

Based on data from the Ministry of Energy and Mineral Resources, utilization of new geothermal energy is currently (only) at 2.1 GW (2,131 MW) or 8.9% of the potential of 23.9 GW. This is due to the high risks and costs involved in developing geothermal projects.

ESDM Ministry’s Geothermal Director Ida Nuryatin Finahari explained ESDM Minister Arifin Tasrif had given directions to the Geology Agency to improve the quality of geoscience data through data acquisition and exploration drilling.

The development of the data includes geological survey activities, geochemical surveys, geophysical surveys (gravity and magnetotellurik), temperature bore surveys, and exploration well drilling. This is in line with Law Number 21 of 2014 concerning Geothermal and Government Regulation Number 7 of 2017 concerning Geothermal for Indirect Use.

The provision reads, the Minister of Energy and Mineral Resources can carry out preliminary and exploration surveys to determine the geothermal working area (WKP). In addition, the Minister of Energy and Mineral Resources can carry out additional data on geothermal areas through geoscience survey activities, temperature ramps, test drilling and / or exploration well drilling.

“Geothermal development has different levels of risk at each stage. The availability of geoscience data prior to geothermal exploration drilling determines the success rate of geothermal well drilling,” Ida told Katadata last week.

Furthermore, according to Ida, the availability of 3D and magnetotelluric data and temperature slopes can reduce drilling failure to 50%. Meanwhile, the temperature slope survey can provide information on temperature gradients and subsurface lithology to identify geothermal systems.

“The success of geothermal development will increase significantly after exploratory drilling, namely the drilling success ratio increases from 40-50% to 70-80%,” Ida said. She explained the implementation of exploration by the government was motivated by the encouragement of the geothermal industry.

This was to improve bankability and data reliability of the preliminary survey results before offering WKP to the Business Entity. Because the geoscience survey data and the results of geothermal exploration have been borne by the Business Entity. That makes geothermal investment less attractive. As a result, the WKP bidding activities by the government are less attractive to business entities. “The high cost of exploration has also affected the economic price of geothermal projects,” she said.

Source: KataData