EXPANDING OPPORTUNITIES GEOTHERMAL DEVELOPMENT

IN INDONESIA

GRC ANNUAL MEETING 2017

Salt Lake City , 1 - 4 October 2017

ABADI POERNOMO PRIJANDARU EFFENDI

Indonesian Geothermal Association

CURRENT ENERGY CONDITION

A. High dependency on fuel. B. Indonesia energy mix 2015: oil (46%); coal (26%); gas

(23%); nre (5%). C. Indonesia has been a net oil importer since 2004.

Production (287 mboe); consumption (420 mboe); oil fuel import (195 mboe); crude oil import (121 mboe); refinery capacity of ± 1 million barrels per day.

D. Energy consumption per capita is still low (5,4 mboe/cap); consumption of electricity (865 kwh/cap); electrification ratio (88.3%); power generation capacity (53 GW).

E. Very high energy subsidies F. Energy is still used as an export commodity: Gas:+

42%, exported Coal: + 82% exported G. Fuel operational reserves only for 20-25 days and there

are no reserves of energy buffer. H. The final energy elasticity is above 1 I. Supporting infrastructure has not been developed

optimally J. The development of new and renewable energy is not

optimal.

0

Government Regulation number 79 of 2014 On National Energy Policy, target of the energy mix by 2025 :

– Oil : < 25%, – Gas : > 22% – NRE : > 23% – Coal : > 30%

ENERGY MIX 2015

NRE

Oil Gas Coal

46%

26%

23%

5%

166 MTOE

INDONESIA ENERGY MIX 2025 2050

Energy Role as the national capital development

NRE on Energy Mix > 23% > 31%

Energy Supply > 400 MTOE > 1.000 MTOE

Power plants > 115 GW > 430 GW

Energy Elasticity < 1 < 1

Electricity /capita/years 2.500 kWh 7.000 kWh

Electrification Ratio ∼100% ∼100%

46%

26%

23%

5%

2015 166 MTOE

23%

25%

30%

22%

2025 412 MTOE

31%

20%

25%

24%

2050 1.030 MTOE

NRE Crude Oil Natural Gas Coal

TARGET 2025

TARGET 2050

NEW AND RENEWABLE ENERGY TARGETS

2025

23% NRE mix

92,2 MTOE

23,0 MTOE

Biofuel 13,9* mio KL

Biomass 8,4 mio ton

Biogas 489,8 mio M3

CBM 46,0 MMSCFD

ELECTRICITY 45,2

GW 69,2 MTOE

2050

31% NRE mix

315,7 MTOE

79,4 MTOE

Biofuel 52,3* mio KL

Biomass 22,7 Mio ton

Biogas 1.958,9 mio M3

CBM 576,3 MMSCFD

ELECTRICITY 167,7

GW 236,3 MTOE

FOSSIL ENERGY POWER PLANT

FOSSIL ENERGY POWER PLANT

2015 2020 2025 2030 2035 2040 2045 2050

135

443

60

FOSSIL ENERGY POWER PLANT

NRE POWER PLANT

TYPE 2015 2020 2025 2030 2040 2050

NRE 8.6 16.2 45.2 69.7 118.6 167.6 14.3% 19.4% 33.3% 36.6% 37.4% 37.8%

FOSSIL 51.5 67.3 90.4 120.6 198.6 275.4 85.7% 80.6% 66.7% 63.4% 62.6% 62.2%

Total 60.1 83.4 135.5 190.2 317.2 443.1

CURRENT PROGRESS OF GEOTHERMAL

Geothermal Potential

Geothermal Working area

Regulation

70 GWA • Existing 19 GWA • New 51 GWA

Resources 11.073 MW Reserves 17.506 MW Geologi Agency, December 2016

• Law No. 21/2014 : Geothermal • GR No. 28/2016 : Amount and

Procedure of Production Bonus • GR No. 7/2017 : Indirect Use • MREMR No. 21/2017 : Waste of Mud and

Boreholes • MREMR No. 23/2017 : Production Bonus • MREMR No. 36/2017 : Preminaliry

Survey and Preminaliry Survey Plus Exploration

• MREMR No.37/2017 : GWA

Intalled Capacity 1.698,5 MW • 12 GPP on 10 GWA • Utilization 9.3% from

Geothermal reserves

Electricity Production

4.78 GWh • 41% from the target

11.6 GWh on 2017 (data on June 2017)

Steam Production

35.89 M Ton • 41% from the target

88.72 M Ton on 2017 (data on June 2017)

No Location Location Number Potential Energy (Mwe)

Installed Resource Reserve Speculative Hypotetic Probable Possible Proven

1 Sumatera 97 2.893 1.935 5.097 930 917 342 2 Java 73 1.410 1.689 3.949 1.373 1.865 1.224 3 Bali 6 70 22 122 110 30 0 4 Nusa Tenggara 27 225 409 848 - 15 12,5 5 Kalimantan 14 152 17 13 - - 0 6 Sulawesi 78 1.221 314 1.242 80 140 120 7 Maluku 33 560 91 775 - - 0 8 Papua 3 75 - - - - 0

Total 331

6.596 4.477 12.046 2.493 2.967 1.698,5 11.073 17.506

GEOTHERMAL POTENTIAL IN INDONESIA

2015 2016 2017 2018 2019 2020 2025 2030 2040 2050

Geothermal 1.438,5 1.653,5 1.908,5 2.133,5 2.493,5 3.109,5 7.241,5 9.300 13.423 17.546

Hydro and Micro Hydro

5.024 5.119 5.236 5.491 7.009 7.889 20.960 25.844 35.611 45.379

Bioenergy 1.740 1.886 2.093 2.359 2.674 3.024 5.532 9.651 17.887 26.123

Solar 79 229 429 679 979 1.379 6.379 14.103 29.551 45.000

Wind 7 57 107 207 307 507 1.807 7.167 17.887 28.607

Other NRE 372 1.860 1.860 1.860 1.861 1.863 3.128 3.779 5.081 6.383

Total 8.660 10.804 11.728 12.939 15.807 18.475 45.044 69.843 119.440 169.038

RENEWABLE ENERGY DEVELOPMENT PLANT

Geothermal development target can be achieved required by: 1. Optimize geothermal potential in large fields especially in GWA managed by Pertamina 2. Electricity prices from geothermal are suitable with economy of field development; 3. Simplification of permit in geothermal sector 4. Fiscal incentives for geothermal development

TARGET AND MILESTONE OF GEOTHERMAL DEVELOPMENT

1.698,5 MW additional capacity from 2500

4. GPP Sarulla Unit 2 (110 MW) 5.000,0

500

Capa

city

(MW

)

Addi

tiona

l Cap

acity

(MW

)

1. GPP Ulubelu Unit 4 (55 MW) (COD 25 April 2017) 2. GPP Karaha Unit 1 (30 MW) 3. GPP Sorik Marapi (Modular, 20MW)

0

37

110

7,5

60

35

8.000,0

7.000,0

6.000,0

4.000,0

3.000,0

2.000,0

1.000,0

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2021 2022 2023 2024 2020

Rencana Kapasitas Tambahan Kapasitas

3000

2000

1500

1000

0

GEOTHERMAL WORKING AREA STATUS OPERATION:

10 GWA(1.698,5 MW) Development Plans (1.153 MW) PRODUCTION:

10 GWA (1.698 MW) Development plans (1.135

MW)

(12 MW) (220 MW) (377 MW) (282 MW) (505 MW)

(60 MW) (120 MW)

(10 MW) (2,5 MW)

(110 MW)

EXPLOITATION: 8 GWA (1.135 MW)

1. 2. 3. 4. 5. 6. 7. 8.

Sungai Penuh Lumut Balai Hululais Karaha Cakrabuana Cibuni Tabanan Tulehu Muaralaboh

(145 MW) (285 MW) (340 MW)

(50 MW) (10 MW) (65 MW) (20 MW)

(220 MW)

EXPLORATION & EXPLOITATION:

26 GWA ( 2.970 MW) PPA SIGNATURE

13 GWA (1.485 MW) 70 GWA (7.503 MW) 1.

2. 3. 4. 5. 6. 7. 8. 9.

Gn. Rajabasa Rantau Dedap Blawan-Ijen Gn.Ungaran Telaga Ngebel Baturaden Guci Kaldera Danau Banten Cisolok Sukarame

(220 MW) (220 MW) (110 MW)

(55 MW) (165 MW) (180 MW)

(55 MW) (110 MW)

(45 MW) (45 MW)

(240 MW) (10 MW) (30 MW)

EXPLORATION: 18 GWA (1.835 MW)

LICENSEE PROCESS : 1 GWA (110 MW) 10. Tampomas

11. Sorik Marapi 12. Jaboi 13. Sokoria

1. Seulawah Agam (110 MW)

READY TO ASSIGNMENT / TENDER:

33 GWA (1.590 MW)

Sibayak Ulubelu Cibeureum Parabakti Pangalengan Kamojang Darajat Dieng Lahendong Tompaso Ulumbu Mataloko Sibual-Buali

1. 2. 3. 4. 5. 6. 7. 8. 9.

10.

PPA SIGNATURE PROCESS: 5 GWA (330 MW)

1. 2. 3. 4. 5.

Gn. Talang - B. Kili Gn. Lawu Way. Ratai Candi Umbul Telomoyo Gn. Arjuno Welirang

(20 MW) (110 MW)

(55 MW) (55 MW)

(110 MW)

GEOTHERMAL DEVELOPMENT BREAKTROUGH

Assignment on SOE

PSA+ Exploration

Incentive (Fiscal & Non Fiscal)

Simplification of Licensing

Government drilling & Geothermal Fund

Optimizing of Potential Development in the Large Field

CHALLENGES

Social Matters issues Geothermal Location Within the Forest Area

Pricing Licensing

Funding

• Given that Indonesia retains the largest reserves of geothermal resources globally, which is currently only 5% being utilized, opportunity to invest is very sexy

• Through a National Energy Policy on targeting the Energy Mix by 2025, Government is

seriously attempting to accelerate the geothermal development by simplifying and shortening bureaucratic of all permits and commercial process with the Buyer (PLN)

• Development of a pricing policy that is aimed to meet the expectation of developer, but still in

a competitive range with PLN's production cost, is underway; it is aimed to combine pricing policy with fiscal incentives

• Indonesian Geothermal Association (INAGA) will always take an important role of geothermal

development in Indonesia by cooperating in working relationships with all stake holders for the benefit of geothermal development

• In order to succeed in Indonesia; it requires good local knowledge, patience and

determination

CLOSING REMARKS

Source : Presidential Decree No.22/2017 : Energy Road Map Geological Agency, MEMR 2016 Directorat General NRCE, MEMR 2017 Handboof of Energy Indonesia, Pusdatin MEMR 2015