Sumitomo invests in Indonesian geothermal power

Japan’s third-largest trading house, Sumitomo Corp, France’s GDF Suez and PT Supreme Energy of Indonesia are forming a consortium on a 35/35/30 basis to build and operate two geothermal power plants in West Sumatra and Lambung, Indonesia. Japan’s Bank for International Cooperation is expected to provide financing for the US$1.5bn project.

Each plant will able to generate 220MW. Combined, the power stations will provide sufficient output for 6m people when they enter operation in 2016.

Output from the geothermal plants will be bought by state-owned power company PT Perusahaan Nagara on a 30-year contract.

Indonesia holds 40% of the world’s total geothermal reserves but at present, less than 4% is under development.