International Power signs up for geothermal projects in Indonesia

Electricity group International Power (IPR) and French utilities firm GDF SUEZ (which owns 70 percent of IPR) have announced that IPR-GDF SUEZ Asia has signed 30-year power purchase agreements (PPAs) for two 220MW geothermal projects with the Indonesia state-owned utility, PLN.

IPR-GDF SUEZ Asia has a 35% interest in the projects, and will work alongside project partners PT Supreme Energy and Sumitomo Corporation.

The two projects are planned to be built on Sumatra island "to deliver power to the region which continues to experience high demand growth," IPR said.

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They are both included in the Indonesian government's second fast-track programme, of which around 4,500MW should come from geothermal sources.

Once exploration drilling for a geothermal resource has commenced, project financing and engineering, procurement and construction (EPC) arrangements can be negotiated. Both projects are expected to start operation in 2016.

BC