The Indonesian Ministry of Energy and Mineral Resources (ESDM) will not offer geothermal working areas in auctions in the next 24 months, waiting for Presidential regulation and government drilling mechanism for geothermal projects.
Reported this morning, the Indonesian Ministry of Energy and Mineral Resources (ESDM) has confirmed that it will not offer geothermal working areas (WKP) for the next 2 years.
Ida Nuryatin Finahari, Director of Geothermal Energy at the Directorate General of New and Renewable Energy and Energy Conservation (EBTKE) of the Ministry of Energy and Mineral Resources, said that the auction was canceled because the ministry is waiting for the issuance of a Presidential Regulation on the Purchase of Renewable Energy Electric Power (Perpres EBT).
The regulation will regulate the government drilling mechanism for geothermal exploration (WKP-WKP) which will be offered to developers. Later, the WKP data and information obtained by the developer is complete or has proven proven geothermal reserves and the developer can directly develop the WKP without going through the survey and exploration stages.
“Maybe 2020-2021 we have not yet conducted a WKP auction. We will add data acquisition first, in 2021 we will start drilling as well. In 2022 there may be a new WKP auction that will be developed directly,” Ida said today.
This government drilling activity is also expected to be able to minimize the risks borne by the developer, which in turn will have an impact on reducing electricity tariffs from the developed geothermal power plants.
According to Ida, so far the biggest risk in geothermal development is at the exploration stage. In proving geothermal steam reserves in a work area, at least three drilling wells need to be carried out. Drilling one well costs around US $ 3-US $ 12 million.
“The government’s efforts in the future WKP-WKP being tendered have at least provided an illustration that the risks taken there are already very minimal. This means that the government has already done it in advance,” he said.