85 MW Geothermal Plant in West Sumatra Commences Operation

Jan 2020

In December 2019, PT Supreme Energy Muara Laboh commenced commercial operations of its Muara Laboh Geothermal Power Plant (PLTP) located in Solok Selatan Regency, West Sumatra Province. The project was jointly developed by PT Supreme Energy Muara Laboh (30%), part of PT Supreme Energy of Indonesia, France’s ENGIE (35%) and Japan’s Sumitomo (35%).

The total investment for the phase-1 development amounted to USD 580 million. The Asian Development Bank and the Japan Bank for International Cooperation are the lenders for the project. The project was kicked off by a preliminary study in 2008, while the Power Purchase Agreement (PPA) for 30 years was signed in 2012. The 85 MW power plant’s output will be distributed to the Sumatra electricity network owned by national electricity distributor, PT PLN (Persero) which can be distributed to around 340,000 households.

PT Supreme Energy has also been in talks with PLN and the Ministry of Energy and Mineral Resources (ESDM) on the phase-2 Muara Laboh with a 65 MW capacity. Investment is expected to reach USD 400 million for the second phase.

Besides Muara Laboh, Supreme Energy is developing the 90 MW Rantau Dedap geothermal power project in South Sumatra and exploration program for the Gunung Rajabasa Geothermal Work Area in South Lampung Regency.

Indonesia is looking to tap into its potential as the world’s second largest geothermal power producer. At present, it only generates 2,000 MW. But by 2028, the country aims to triple the number. The Indonesian government is attempting to boost investment through tax breaks and electricity purchase at fixed prices on long-term bases.

(Sources: Think GeoEnergy; Nikkei Asian Review)

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