Pertamina Geothermal Energy Prepares Investment of 1.67 Billion US Dollars to Increase Installed Capacity of Geothermal Energy

Illustration. (Photo: Doc. Antara)

JAKARTA - PT Pertamina Geothermal Energy (PGE) Tbk is preparing an investment of USD 1.6 billion until 2027 to increase the installed capacity base of geothermal energy.

PGE Finance Director Nelwin Aldriansyah said the company targets to increase its own installed capacity base, from the current 672 megawatts (MW) to 1,272 MW in 2027.

"The key to supporting the company's revenue growth is the increase and growth of its installed capacity. To support the growth of the 600 MW self-operated installed capacity, the company has planned new investments with a total value of 1.6 billion," Nelwin said through his statement, quoted from Antara, Monday February 13.

He explained, in 2023, the issuer coded PGEO shares had prepared a new investment of US$250 million, from an estimated capital expenditure of only USD 60 million in 2022. Then in 2024, PGE prepared a new investment of USD 350 million.

"That's why we are exploring various funding alternatives such as this initial public offering (IPO). In the near future, we will also issue 'green bonds' and other financing alternatives," said Nelwin.

This subsidiary of PT Pertamina (Persero) is also currently carrying out an IPO by releasing a maximum of 25 percent of its shares to the public from the issued and fully paid capital after the IPO.

PGE plans to release as many as 10.350.000.000 (10.35 billion) ordinary shares at an initial offering price of IDR 820-IDR945.

Through an initial public offering, PGE is targeting to raise funds of up to IDR 9.78 trillion. The allocation of IPO proceeds will be used by the company, one of which is for capital expenditure (capex).

In addition, PGE also allocates a maximum of 1.50 percent or 630.398.000 (630.39 million) shares of issued and fully paid capital after the public offering for the share purchase option program for management and employees.

This policy is in accordance with a circular shareholder decision on January 27, 2022.

The period for the initial public offering of PGE's shares is scheduled to take place from 20 February 2023 to 22 February 2023. The initial listing or "listing" on the main board of the Indonesia Stock Exchange (IDX) will take place on 24 February 2023.

In the initial public offering, PGE appointed PT Mandiri Sekuritas, PT CLSA Sekuritas Indonesia, and PT Credit Suisse Sekuritas Indonesia as underwriters for the issuance of securities. PGE also appointed CLSA, Credit Suisse, and HSBC as "international selling agents".

Previously, PGE noted that the company reached USD 287 million by the end of the third quarter of 2022 or grew 3.9 percent "year-on-year" (yoy). The revenue growth report continues the positive trend of the company's "top line" performance in the last 3 years or in the 2019-2021 range.

It is recorded that annual revenue is US$328 million in 2019, USD 354 million in 2020, and USD 369 million in 2021.

In line with revenue growth, PGE posted a significant increase in net profit of 67.8 percent on an annual basis to US$111 million in September 2022. Then, "net profit margin" (NPM) also rose from 24 percent in the third quarter of 2021 to 38.8 percent at the end of quarter III/2022.

PGE's achievement was also supported by long-term contract agreements or an average of over 20 years with PT PLN (Persero) as the sole offtaker. This position also ensures the acquisition of predictable cash flows.