PLN to buy Pertamina geothermal steam

JAKARTA (JP): State electricity company PT Perusahaan Listrik Negara (PLN) signed an agreement on Wednesday to buy geothermal steam from state oil and gas company Pertamina for its planned 20-megawatt (MW) power plant in North Sulawesi.

PLN's President Director Adhi Satriya said that PLN would buy geothermal steam from Pertamina for 30 years starting from 2001.

Adhi said the power generated by the Lahendong geothermal plant would be transmitted through the 70 kilovolt Minahasa power grid.

"Once the Lahendong geothermal power plant is operating, the power demand on the Minahasa power network will be fulfilled. But, the network will still need some power reserves," Adhi said during the signing ceremony of the agreement.

He said PLN would buy the geothermal steam at Rp 161.5 (2 US cents) per kilowatt hour until the end of 2001.

Thereafter, the price would be reviewed every three months, taking into account the rupiah's exchange rate against the dollar and the inflation rate.

Adhi said PLN would build the power plant with a loan worth 140 million French francs ($23 million) provided by the French government.

Pertamina will invest $15 million to build the facilities to produce the geothermal energy.

According to Pertamina's president Martiono Hadianto, the Lahendong geothermal steam resource is estimated to have a power generation capacity of 60 MW.

"As such, the option to increase the Lahendong geothermal power plant as stated in the contract is very viable," Martiono said.

Adhi said the Lahendong power plant is scheduled to come on stream in September 1999, but PLN has delayed the completion of the project until Oct. 2000 due to the monetary crisis which has crippled the country's economy for almost two years.

The government said the country has geothermal energy resources of more than 19,000 MW but only a small part has been developed.

Several foreign independent power producers (IPP) have embarked on the development of the country's geothermal resources but most of the projects were put on hold by the government in a retrenchment measure to deal with the economic crisis. (jsk)