PGE Is Considered Unable To Realize Capacity Improvement

JAKARTA - PT Pertamina Geothermal Energy Tbk (PGEO) is considered unable to realize its plan to increase its own installed capacity of 600 MW within five years.

Bisman Bakhtiar, Executive Director of the Center for Mining Energy Law Studies (Pushep), thinks that PGEO is too optimistic and even boasts about this plan. Moreover, there are still several geothermal business policies that are still not supportive.

"It is very difficult to realize the 600 MW development in a short time because we know there are still policy issues regarding selling prices, licensing, electricity oversupply issues, and other support matters," he said in a written statement, quoted on Friday, April 14.

If you pay attention, he said, currently PGEO has its own capacity of 672 MW which has been developed for 40 years. This refers to the construction of PLTP Kamojang Unit-1 as the company's first working area which was built in 1983.

"The fact is that the geothermal business is not promising in the short term," Bisman added.

Through its prospectus, PGEO openly explains that it must bear high risks from the exploration process. This makes the process of exploiting and developing geothermal energy taking a long time, but still accompanied by a high risk of failure.

For example, the company has drilled a number of wells in the Ulubelu WKP which are targeted to be able to supply steam to additional generating units. However, the results from the well did not meet the company's expectations.

As a result, the company drilled additional wells, including a make-up well, to ensure there is sufficient steam supply to power the power plant.

Furthermore, at WKP Hululais, the company has drilled 10 additional wells to ensure a sufficient supply of steam to power the power plant. Meanwhile, three of the wells experienced well integrity problems and were unfit for commercial operation.

"As a result, the company needs to secure and repair the well, which requires the company to incur unforeseen costs and there is no guarantee that the company will not have to suspend further wells in the future," management wrote through its prospectus.