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Indonesian Geothermal
Exploration & Development Opportunities 1Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
EXPRESSIONS OF INTERESTInvitation for
Indonesian Geothermal
Exploration & DevelopmentOpportunities
INDONESIAN
GEOTHERMAL
March 2010 - Asia Pacific Edition
TM
Indonesian Geothermal
Exploration & Development Opportunities 2Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
Disclaimer & Disclosures
This presentation has been prepared by Activated Logic Pty Limited (ABN: 62 134 740 293) trading as and hereafter referred to as “Activated Logic” for the sole purpose of introducing interested parties to the potential benefits which may be realised in the Indonesian geothermal sector. The information contained in this presentation is not investment or financial advice and is not intended to be used as the basis for making any investment decisions. The presentation has been prepared without taking into account the corporate objectives, financial situation or particular needs of any particular person, company, or organisation.
No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, or to the opinions and conclusions contained in this presentation. To the maximum extent permitted by law, Activated Logic, its partners, its directors, employees or agents, nor any other person accepts any liability, including, without limitation, any liability arising out of fault or negligence, for any loss arising from the use of the information contained in this presentation. In particular, no representation or warranty, express or implied is given as to the accuracy, completeness or correctness, likelihood of achievement or reasonableness of any forecasts, prospects or returns contained in this presentation nor is any obligation assumed to update such information. Such forecasts, prospects or returns are by their nature subject to significant uncertainties and contingencies.
The information in this presentation is an overview and does not contain all the information necessary for making any corporate, strategy, financial or any other decision. Before making any decisions, you should consider, with the assistance of your own legal, tax, business and/or financial advisers, whether a decision is appropriate in light of your particular investment needs, objectives and financial circumstances. Past performance is no guarantee of future performance. Unless otherwise stated, all “dollars” or “$” refer to Australian Dollars.
Technology development and commercialisation relies on the interpretation of complex and often uncertain data and information which cannot be relied upon to lead to a successful outcome in any particular case. Geothermal resources and technology development and commercialisation is inherently uncertain and involves potentially significant risk of failure. All information regarding prospective market sizes and other information, is given in the light of this caution.
This presentation contains a number of forward looking statements, therefore recipients of this presentation should conduct their own investigation, evaluation and analysis of the data and information described in this document. In particular any estimates or projections or opinions contained herein necessarily involve significant elements of subjective judgment, analysis and assumptions and you should satisfy yourself in relation to such matters.
The distribution of this document in various jurisdictions may be restricted by law. Any recipient of this must seek advice on and observe any such restrictions.
IMPORTANT DISCLOSURES
Activated Logic, or its directors, officers, staff and their associates may hold shares or other relevant interest in the securities of entities related directly or indirectly to any proposed or possible transaction as may be described or covered by this presentation. Activated Logic and its advisers may earn brokerage, fees, commissions, other benefits or advantages as a result of a transaction arising from any research, opinions, publications or solicitation of potential investors, partners or clients. Activated Logic may have provided corporate advice within the past and may continue to provide corporate advice to companies or related parties concerned, for which Activated Logic may have received gross fees and /or continue to receive fees.
Activated Logic holds investments directly and indirectly in a range of public and private entities and has relationships with a number of specialised brokers, international banks and other financial institutions, however Activated Logic is not itself a broker and is not authorised to directly deal in securities. Activated Logic operates within Australian Securities and Investment Commission Class Order CO/273 “Business introduction or matching services” which provides various exemptions from the obligations and requirements of Paragraphs 283GA(1)(a), 741(1)(a), 992B(1)(a) and 1020F(1)(a) of the Corporations Act 2001 (Cth).
The information contained in this presentation is for general information purposes only and does not constitute an offer to issue, or arrange to issue, securities or other financial products.
© Activated Logic Pty Limited 2010. All Rights Reserved.
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 3Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
Indonesian Geothermal Overview
With a population of just over 240 million spread across more than 17,000 islands, Indonesia represents a substantial and growing energy market. The government has set ambitious targets for the installation of significant additional power generation capacity, consisting of both fossil fuel and renewable energy sources, particularly geothermal.
In addition to the 7 major currently operating geothermal projects in Indonesia, the increasingly supportive regulatory regime is encouraging the rapid construction of additional geothermal capacity. The geothermal development pipeline consists of projects at all stages of development.
Project Developer Year Online MW
Wayang Windhu II Pertamina 2009 117
Lahendong IV –VI Pertamina 2011 –2012 60
Dieng II Geo Dipa 2012 120
Panas Bumi ITOCHU 2012 330
Sumatra Jawa Pertamina 2012 240
Darajat IV Chevron 2014 110
Patuha Geo Dipa Energi 2014 180
Ulu Belu Pertamina TBD TBD
Project Developer Year Online MW
Darajat I –III Chevron 1994 255
Salak I –VI Chevron 1994 –1997 375
Dieng I Geo Dipa Energi 1998 60
Sibayak Pertamina 1998 2
Pengalengan Pertamina 2000 110
Lahendong I & II Pertamina 2001, 2007 40
Lahendong III PLN 2008 20
Kamojang PLN 2008 200
1
2
3
4
5
6
7
123
4
5
6
7
10
11
12
13
14
15
8
9
1011
12
13
14
15
8
9
Ope
ratin
g Pr
ojec
ts
Plan
ned
Proj
ects
Operating
Planned
Area of Geothermal Project Tenders
Source: Adapted by Activated Logic 2010, from proprietary and EER research.
Indonesian Geothermal Facts
Installed geothermal capacity
Geothermal target by 2025
Geothermal resources (conservative)
Geothermal resources (optimistic)
Geothermal development cost quartile
Geothermal resource quality
Distribution of Indonesian Geothermal Projects
1,286 MW
9,500 MW
10,000 MW
27,000 MW
quadrant 1 (lowest)
high temperature
The next wave of geothermal
development in Indonesia is being
led by ambitious Independent
Power Producers (IPP’s). These
project developers are keen to take
advantage of the recently increased
geothermal tariff and the attractive
CDM opportunities.
Given Indonesia arguably hosts the
highest quality, low cost geothermal
resources in the world, interest
and investment in the Indonesian
geothermal sector is expected to
intensify expeditiously.
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 4Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
The Indonesian Geothermal Advantage
High temperature geothermal resources
Large geothermal development pipeline
Capable development partners
Attractive project capex profiles
Substantial CDM opportunities
Competitive geothermal tariff
VAT concessions
Key Competitive Advantages
Sumbing Volcano. Java, Indonesia
World-class geothermal opportunities
As part of the Indonesian Governments “Crash Program” to install an additional 10,000 MW by 2011 and a similar capacity commencing in 2014, there is a sense of immediate urgency for increasing power generation capacity.
To accelerate the development of geothermal energy in Indonesia, the government has implemented a raft of measures including VAT-concessions for drilling equipment and subsidies. Of greatest significance, the government has legislated the state-run power utility Perusahaan Listrik Negara (PLN) to increase the geothermal tariff available to Independent power producers (IPP’s) from $US71 to US$97 per MW.
A 100MW Indonesian geothermal power plant project, has the potential to generate up to US$10 million per annum, from the sale of CER’s generated through CDM projects.
CER - Certified Emissions ReductionsCDM - Clean Development Mechanism (Kyoto Protocol)
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 5Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Hyd
roth
erm
al M
W P
oten
tial
Hydrothermal Resource (Optimistic)
Hydrothermal Resource (Conservative)
Exhibit 2-7: Regional Hydrothermal Geothermal Resource Potential Comparison
Indonesian Geothermal Resources
Estimates by numerous institutions, including the U.S. Department of Energy (DOE), International Energy Agency (IEA), International Geothermal Association (IGA) and the Government of Indonesia have collectively determined the conventional geothermal potential of Indonesia to be approximately 27,000 MW.
Source: Adapted by Activated Logic 2010, from proprietary and EER research.
Conventional Geothermal Resource Potential
Geothermal resource potential of 27,000 megawatts
Indonesia’s conventional (hydrothermal) geothermal resources are amongst the most significant in the world and are only behind the United States, which hosts vast geothermal resources (concentrated largely in the western states of California and Nevada). The increased geothermal activity in Indonesia is expected to further increase resource estimates.
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 6Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
$1,500,000$1,709,000
$1,873,000$2,000,000
$2,400,000 $2,444,519$2,610,000
$3,751,000
$4,018,000
$5,785,000
$5,274,321
$6,195,510
Sumatera (Coal) Wayang Windu II
Patuha Lahendon IV Ac�vated Logic Client A
Ac�vated Logic Client B
Indonesia Average
US (Lower-quar�le)
Tongonan (Philippines)
US (top-quar�le)
Australia (HSA) Australia (EGS)
Forecast Geothermal Development Costs (US$/MWe)
Comparative Geothermal Development Costs
Indonesian geothermal resources are characterised by high temperature and shallow reservoirs with high flowrates, resulting in highly productive geothermal reservoirs. The high temperature Indonesian geothermal projects are often suitable for flash cycle (either single, dual or hybrid) based power generation systems which are exceptionally cost competitive,
largely due to the large turbine capacities often exceeding 50 megawatts. The power cycle cost efficiencies, high temperature resouces and the relatively low drilling costs for shallow wells, combine to make Indonesian geothermal development amongst the most competitive in the world to develop.
Source: Activated Logic 2010, from various proprietary and public domain data.
Actual & Forecast Geothermal Development Costs (US$/MWe)
Indonesian geothermal projects are highly cost competitive
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 7Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
Meg
awat
ts (M
W)
Operating
Announced Pipeline
Markets with existing geothermal capacity driving new global growth
Emerging Geothermal Markets
Global Geothermal Development Pipeline
Installed geothermal capacity in Indonesia is forecast to increase rapidly from the current 1,286 megawatts to more than double, with current estimates at approximately 2,700 megawatts by 2012. Indonesia’s high quality geothermal resources, relatively low developments costs and
Source: Adapted by Activated Logic 2010, from proprietary and EER research.
Global Geothermal Development Pipeline
Indonesian geothermal pipeline exceeds 2,000 megawatts
the recently announced increased geothermal tariff are pivotal drivers behind major Indonesian geothermal development pipeline. The Indonesian geothermal development pipeline consists of both greenfields developments and expansion of existing geothermal projects.
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 8Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
01. Nanggroe Aceh Darussalam02. North Sumatera03. Riau04. Riau Archipelago05. West Sumatera06. Jambi07. Bengkulu08. South Sumatera09. Bangka Belitung10. Lampung11. Banten 12. Jakarta13. West Java#
14. Central Java15. Yogyakarta16. East Java17. Bali
18. West Nusatenggara 19. East Nusatenggara 20. West Kalimantan 21. Central Kalimantan 22. East Kalimantan 23. South Kalimantan24. North Sulawesi25. Gorontalo 26. West Sulawesi27. Central Sulawesi 28. South Sulawesi29. Southeast Sulawesi30. North Maluku31. Maluku32. West Papua33. East Papua # Including Banten province
The Indonesian Geothermal Opportunity
Activated Logic represents numerous geothermal clients across the Asia Pacific, with a specific focus on Indonesia. Activated Logic’s Indonesian clients are active across the geothermal development value chain, ranging from projects at the early pre-survey stage, through to established, third-party verified resources on the verge of large scale, development drilling.
Our extensive and unique reach into the Indonesian geothermal sector, provides us with the unique capability to offer companies across the Asia Pacific with a diverse range of geothermal opportunities in Indonesia. Our Indonesian geothermal clients are looking for foreign partners for their respective geothermal projects which are interested in:
Jointly bidding for geothermal working areas (GWA’s) Conducting pre-feasibility studies for geothermal projects Conducting FEED, development drilling & power plant construction
Source: Adapted by Activated Logic 2010, from IJT 2009.
Global Geothermal Development Pipeline
Activated Logic’s geothermal clients are actively exploring and developing geothermal projects in Indonesia targeting 3,000 MW’s of installed
capacity, representing more than 10% of Indonesia’s total geothermal potential.
All of these geothermal projects are seeking technical and financial partners to accelerate
the commercialisation of these exciting projects.
Available Geothermal Projects - By Province
Provinces in red indicate the current availability of geothermal project opportunities, by Activated Logic.
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 9Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
Australia Chile Europe (various) Iceland Japan Kenya Papua New Guinea Turkey United States
& other selected regions.
Regions with proven conventional geothermal resources.
Geothermal distribution
Additional Geothermal Project Locations
Conventional geothermal resources are typically found in regions proximal to continental plate margins. These areas are often characterised by historic or current volcanic activity.
In addition to the world-class geothermal resources found throughout Indonesia, the Global Geothermal Alliance has access to all the key prospective geothermal regions around the globe.
The members of the Global Geothermal Alliance conduct detailed research into they key geothermal markets on behalf of private clients, as well as more general industry and corporate research. A range of country specific geothermal reports are available by request.
Available project locations
We have developed an extensive network across the geothermal value chain over many years, and have a wealth of knowledge and experience to share .
Our experience spans the entire geothermal industry, encompassing the vast diversity of projects from early stage pre-feasibility, through to corporate finance for commercial scale development projects. We have a range of opportunities if you are looking at building or diversifying your geothermal portfolio internationally.
Conventional Geothermal Resources
Source: Adapted by Activated Logic 2010, from proprietary and EER research.
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 10Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
globalgeothermal
alliance
TM
Your Geothermal Financial Partner
“If you are serious about developing a
competitive geothermal project portfolio;
- speak with us to find out, how the Global
Geothermal Alliance can activate and add
value to your geothermal assets.”
CAPABILITY STATEMENT
Discover the key value creation strategies utilised by the Global Geothermal Alliance (GGA), and explore the list of our recent geothermal transactions.
Request a copy of the Global Geothermal Alliance Capability Statement, by contacting Activated Logic, or available for download by clicking here .
Download Now
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 11Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
Research Services
• Benchmark exploration, drilling and plant costs• Geothermal sector & technology research• Market, grant and pricing research• Identification of suitable project & offtake partners• Identification of potential investors and/or lenders
Strategy Services
• Financing & power offtake strategies• Develop operational & corporate strategies• Determine optimal financial structure• Determine optimal ownership structure• Evaluation of acquisition opportunities
Communication Services
• Prospectus & IM development• Corporate partner negotiations• Promotional project collateral• Investor roadshows & dataroom• Annual reports & corporate literature
Investment Services
• Initial public offerings & sub-underwriting• Project assessment & valuations• Merger & acquisition evaluation• Investor roadshows & engagement• Identification of strategic investments
Financial Services
• Financing strategies & capital raisings• Debt syndication & bookbuild• Identification of financing options• Due-diligence & project valuation• Mergers, acquisitions & asset disposals
Base case scenario
ValueCreation
“Businessas usual”
PHASE 1 EarlyStageExploration
PHASE 2 Drilling &FeasibilityAssessment
PHASE 3 Design & ConstructionActivities
Value Added Services
Base Case Scenario
Research
Strategy
Communication
Investment
Finance
Business as Usual
Your Strategic Geothermal Partner
Reservoir Volume
Reservoir Temperature
Reservoir Flow Rate Capacity
COMMERCIAL DRIVERS
High valueMarkets
Project Integration
TECHNICAL DRIVERS
Proximity to Infrastructure
Power CycleTechnology
Source: AL-GCAMTM, developed by Activated Logic, 2008 - 2010.
Activated Logic - Geothermal Commerciality Assessment MatrixTM
Activated Logic - Value Creation Process
Source: Activated Logic, 2008 - 2010.
Geothermal Service Offering
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Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner
Indonesian Geothermal
Exploration & Development Opportunities 12Commercial in Confidence
Not to be Distributed
March 2010
Asia Pacific Edition
globalgeothermal
alliance
TM
Your Geothermal Financial Partner
Global Geothermal Alliance, Geothermal Financing Breakfast (AGEC, Nov 2009).
Global Geothermal Alliance, exhibiting at World Geothermal Congress (Bali), 25 - 30 April, 2010.
With a large proportion of the world’s conventional geothermal resources, geothermal experts from around the world will descend on Bali - Indonesia in April, for the 2010 World Geothermal Congress.
We look forward to seeing you in Bali.
Islandsbanki Sustainable Energy TeamKirkjusandi IS-155 Reykjavik, IcelandTel: +354 440 4500
For more information:[email protected]
Activated Logic Sustainable Energy TeamPO Box 889, Sanctuary Cover Queensland, 4209, AustraliaTel: +617 5561 7282
For more information:[email protected]
Australian Enquiries
1300 4 LOGIC or (1300 4 56442)
International Enquiries
+617 5561 7282
Direct
Mr. Bahay Ozcakmak
Mob: +61 (0)414 596 007
Email: [email protected]
Contact Details
For a confidential discussion to explore and discuss these geothermal opportunities, contact Activated Logic today.
R
Indonesian Geothermal Expressions of Interest
Disclaimer & Disclosures
Indonesian Geothermal Overview
The Indonesian Geothermal Advantage
Indonesian Geothermal Resources
Comparative Geothermal Development Costs
Activated Logic Contact Details
Global Geothermal Development Pipeline
The Indonesian Geothermal Opportunity
Additional Geothermal Project Locations
Geothermal Alliance Capability Statement
Your Strategic Geothermal Partner