PLN set to buy stake in Pertamina Geothermal to speed up development
In an interesting move, Indonesia state energy company PLN is set to acquire a stake in Pertamina Geothermal Energy to help accelerate geothermal power project development in Indonesia.
Reported already earlier this week in Indonesia, local news now provides details about a rather interesting move in Indonesia.
State electricity company PLN, so the Jakarta Post – is set to acquire a stake in state energy giant Pertamina in PT Pertamina Geothermal Energy (PGE). This is part of a plan to help speed up development of geothermal power projects that could provide electricity to PLN.
Pertamina, as mostly an oil and gas firm, currently holds a 100 percent stake in Pertamina Geothermal Energy (PGE). Pertamina President Director Dwi Soetjipto said the company was currently conducting due diligence on the acquisition, highlighting its willingness to sell some of its stake in PLN for the greater good of the nation.
Earlier this year we reported on challenging negotiations between PLN and PGE on power tariffs for the Kamojang geothermal plant.
There is a strong belief that this move will help accelerate development of geothermal projects in the country.
“Currently, PGE itself has only installed 450 MW. We are targeting that in the next three to four years, it can reach above 1,000 MW,” Dwi said on the sidelines of the 4th Indonesia International Geothermal Convention and Exhibition (IIGCE) on Wednesday.
PLN President Director Sofyan Basyir said the acquisition plan was partly to meet the 7,000 MW geothermal power plant target set by the government. In total, only 1,600 MW of the nation’s geothermal energy potential is being utilized.
“[With the acquisition] we will have a greater ability to conduct geothermal explorations,” he said, adding that the plan would likely decrease the high prices of geothermal power.
Update August 11, 2016
In an updated story on The Jakarta Post today (Aug. 11), it is reported that PLN is set to buy an interest of up to 50% in Pertamina Geothermal Energy (PGE), with an acquisition be possible until the end of this year. With the move PLN also hopes to reduce prices PLN needs to pay for steam from PGE geothermal operations and in turn could reduce overall energy cost.