Origin to explore geothermal opportunities in Indonesia

Origin Energy Limited (Origin), as part of a consortium, has been successful in bidding for a geothermal exploration concession in Northern Sumatra, Indonesia.

Origin and Tata Power of India, in consortium with PT Supraco Indonesia, have been awarded the Sorik Marapi geothermal exploration concession following a competitive bidding process. It is estimated the Sorik Marapi concession could support the development of 200-300 MW of geothermal generation capacity. Origin will hold a 47.5% effective interest in the concession.

The Sorik Marapi resource will be tested as part of an exploration program over the next 18 months. If the exploration program is successful, a subsequent appraisal program will be conducted. If this appraisal is also successful and appropriate commercial agreements have been secured, construction is expected to begin in late 2012.

Origin’s Executive Director, Finance and Strategy, Karen Moses, said the joint venture is consistent with Origin’s strategy of pursuing exploration opportunities for energy resources near growing markets.

“Origin had been assessing geothermal opportunities in the region since early 2009 and this joint venture is reflective of our belief that geothermal can provide large-scale renewable base load energy,” Moses said.

“Sorik Marapi is a ‘conventional’ geothermal resource similar to established geothermal generation in New Zealand. Origin has expertise in this area through its majority owned subsidiary Contact Energy - one of New Zealand’s leading generators of geothermal energy,” she said.

Tata Power’s Managing Director, Prasad R Menon, said, “Tata Power has a strong mission to achieve at least 25% of its generation portfolio through renewable sources of energy by 2017, geothermal energy being one of the prime renewable growth engines. The Sorik Marapi exploration is testament to our faith in the untapped potential of geothermal energy,” he said.

Indonesia is situated on the Pacific ‘Ring of Fire’ and is expected to have approximately 27,000 MW of potential conventional geothermal resources - considered the largest in the world. Indonesia currently has 1196 MW in geothermal generation in operation.

In addition to Sorik Marapi, Origin has interests in a number of geothermal exploration joint ventures located in the Cooper Basin, South Australia. These joint ventures are focusing on two distinct sources of geothermal energy including:

• enhanced geothermal systems (EGS), which seek to extract heat from hot fractured granites at over 4 kilometres depth, and
• hydrothermal systems, which will seek to commercialise heat from lower temperature sandstone reservoirs at depths of approximately 2 kilometres below the Earth’s surface.