Yudhi Dahlan

Director, PT Dyfco Energy

Our Turkish partner, Hitay, after it studied a number of different geothermal blocks in Indonesia, asked us to be its local partner due to our excellent track record, relationships, capabilities, and experience here in the sector. Our contribution to the partnership is that we bring the technical experience and meet the pre-qualification requirements, while Hitay brings the finance. Hitay has calculated a great price at which we can provide electricity to the government under this project. Things are moving well right now. We have already conducted the survey for the mapping and topographic survey. We should be drilling by 2018. Fortunately for us, given what has happened to oil and gas prices over the last four years, we have been geothermal experts from the outset. Plus, when oil and gas prices fall, geothermal activity goes up. We have a future plan with Hitay to acquire more geothermal blocks in Indonesia. Unfortunately, there are new regulations from the Ministry of Energy and Mineral Resources that are not investor friendly. Nevertheless, investment is not really slowing down; people are still waiting to see if the regulations will change the situation. The great thing is that the minister is pushing geothermal growth, whereas there was not much activity happening in this segment before.

Dennis A. Roper

Director, PT Daya Alam Tehnik Inti (DATI)

We made a conscious decision in 2012 to focus on geothermal projects. Back then, it was impossible to project that oil would dip so low. However, we looked at the regulatory structure that was more flexible for bidding, and there was an opportunity to negotiate directly with operators. We made that decision and have been exclusively geothermal since 2013. We started with six wells for Supreme Energy Rantau Dedap in South Sumatra and then moved to Star Energy Geothermal (Wayang Windu) in West Java, where we drilled six wells. That same rig 253 has now mobilized to North Sumatra to drill for Sorik Marapi Geothermal Power (SMGP). Rig 231 is already there and has drilled seven wells for SMGP. Thus far, we have made the right decision and the operators have been fantastic to work with. It is a different kind of drilling from that of oil and gas. When a geothermal operator comes in and bids for a block, they are bidding based on relatively incomplete information because often no wells have been drilled there yet. After conducting seismic studies and estimating potential, the company negotiates a power purchase agreement with PLN based on the expected geothermal production. Indonesia is number one in terms of potential for geothermal in the world and third in current capacity.

Shinichi Aburaya

Chief Executive, Sarulla Operations Ltd.

In October 2017, Sarulla commenced the second unit at its geothermal power plant, after the first unit opened in March 2017. The second phase generates 110MW. Each unit of the three phases consists of seven generators: one steam turbine generator from Toshiba (Japan) producing about 60MW and the remaining six manufactured by ORMAT Technologies (US). With those six units, we produce another 50MW. The third unit is scheduled to be operational by May 2018. It will add another 110MW to the total capacity. The Sarulla area is brine dominated, and the energy coming out is high-pressure steam and high-pressure brine (hot water). In other parts of Indonesia, most of the areas are steam dominated. For brine-dominated resources, the ORMAT equipment is suitable for energy extraction. For geothermal development, the challenge is that, in this country, there is not much reliable subsurface data. The government has not invested enough to find resources by itself and has been relying on private investors to do so. The regulations have become more reasonable than those in the past, and there are some successful examples, including Sarulla, with many keen investors and interests from banks. However, the basic scheme has not changed much, which is one of the remaining challenges.