Amoseas to build third geothermal power plant

Amoseas to build third geothermal power plant

Dewi Santoso, The Jakarta Post, Jakarta

Amoseas Indonesia Inc., a unit of U.S.-based ChevronTexaco, is
currently under negotiation with two state-owned companies to
build a third geothermal power plant, Darajat III, in Darajat,
West Java, a company senior official has said.

Amoseas Indonesia president Bernie McCloskey said on Friday
that the company had been holding talks with PT Pertamina and
state electricity supplier PLN to agree on a contract for the
power project.

"We'd like to settle the contract as soon as possible -- maybe
sometime this year -- but we can't really say when as we don't
have a deadline," said McCloskey.

He said that the sooner the contract was settled, the better
as it would take at least two years to complete construction of
the power plant.

McCloskey explained that under the first contract signed with
Pertamina, Amoseas had been allowed to develop power plant in the
Darajat area (near Garut) with a capacity of up to 330 megawatts
(MW).

However, with its two existing power plants, Darajat I (55 MW)
and Darajat II (70 MW), Amoseas generated only around 125 MW last
year.

"Thus, for Darajat III, we expect to expand the capacity to
330 MW," McCloskey said.

He declined to provide further details about the expansion
project, saying: "I'm bound to secrecy as the project is
currently under negotiation."

Under a contract with Pertamina, Amoseas acts as an operator
of the electricity plants, which tap geothermal energy from a
young volcano nearby. Electricity from the new unit is sold to
PLN, which already buys power from the two existing units.

Geothermal energy -- pressurized steam, sometimes with hot
water -- is an energy source produced when groundwater descending
from the earth's surface meets the molten magma ascending from
the earth's core in exceptionally hot surroundings. It is
considered an environmentally clean energy source, with a carbon
dioxide emission rate 90 percent lower than that at oil-fired
power plants.

Sitting on the so-called "ring of fire" volcano belt,
Indonesia is blessed with enormous geothermal resources.

Data from the Indonesian Geothermal Association (INAGA) shows
that Indonesia accounts for 40 percent of the world's geothermal
resources, which can potentially generate more than the 20,000 MW
of electricity.

At present, Indonesia has a number of geothermal power plants
with a combined capacity of 747.5 MW (around 5 percent of the
total geothermal potential). The plants are located in Kamojang,
Salak, Darajat and Wayang Windu, West Java; Lahendong, North
Sulawesi and Sibayak, North Sumatra.

The national power supply now stands at 21,000 MW, of which
18,600 MW is allocated for the main Java-Bali grid.

Demand for electricity has been growing at an average of 8
percent annually over the past few years, which, analysts fear,
will propel Indonesia into a serious power crisis in the near
future if no new power supply goes onstream.

However, Minister of Energy and Mineral Resources Purnomo
Yusgiantoro had played down such fears, saying that more power
plants were due to come onstream this year and in subsequent
years to meet the growing demand for power.

Approximately 3,500 MW of additional power supply will enter
the market from 2004 to 2006 with the completion of the Cilegon
plant (750 MW) in Banten, and the Cilacap (600 MW), Muara Tawar
(800 MW) and Tanjung Jati B (1,329 MW) plants, all in Central
Java.