Indonesia's state-owned geothermal developer and operator, PT Pertamina Geothermal Energy (PGEO), is preparing a substantial capital expenditure of IDR 8.74 trillion, equivalent to approximately USD 550 million, for the year 2024. This significant financial allocation is part of PGEO's ambitious objective to increase its geothermal capacity to 1 GW within the next two years.
The announcement of this budget allocation and its intended use for capacity expansion came from PGEO Finance Director Nelwin Aldriansyah during the Q3 Performance Update Roundtable. He further clarified that all the capital expenditure (CAPEX) will be internally sourced.
PGEO President Director, Julfi Hadi, had previously outlined the company's goal to elevate its installed capacity to 1 GW in the coming two years, with the potential to reach 1.2 GW in the next five years. Currently, PGEO boasts a total capacity of 1,887 MW, comprising 672 MW under their direct management and 1,205 MW managed through Joint Operation Contracts.
In the past year, PGEO has intensified its efforts to secure funds, having raised USD 597 million through an initial public offering (IPO) in early 2023 and an additional USD 400 million after issuing green bonds in mid-2023.
Consequently, PGEO has been assertive in its expansion endeavors. The 55-MW Lumut Balai Unit 2 geothermal power plant is anticipated to become operational by 2024. Simultaneously, ongoing drilling and production testing are underway for the 55-MW Sungai Penuh project in Jambi, while infrastructure development continues for the 2×55-MW Hululais Project in Bengkulu.
More recently, PGEO inked an agreement with Chevron New Energies to jointly explore the Way Ratai site in Lampung. Furthermore, PGEO has been eyeing international expansion, signing a partnership agreement with Africa Geothermal International Limited (AGIL) for geothermal development in Kenya.