INDONESIA - Coal & Hydro-Power.

Indonesia has 5,370m tons of coal reserves, of which 4,580m tons are sub-bituminous and lignite. Its coal production rose steadily from 17m t/yoe in 1992 to 70.5m t/yoe in 2003. In 2004-06, coal production exceeded 75m t/yoe. Consumption has risen from 4m t/yoe in 1993 to 18.9m t/yoe in 2003 and reached more than 22m t/yoe last year.

Hydro-power production and consumption have risen to 2.3m t/yoe, the average reported for the past five years, up from 2.1m t/yoe in 2000, 1.7m t/yoe in 1995 and about 1.8m t/yoe in 1993.

Geothermal Energy: There are three geothermal producing areas for Pertamina with a 162 MW capacity. Those areas are: Sibayak (2 MW) in North Sumatra, Kamojang (140 MW) in West Java, and Lahendong (20 MW) in North Sulawesi.

Ormat Industries of Israel, one of the largest operators of geothermal plants in the US, and its partners in July 2006 won a $600m contract to develop 340 MW of geothermal energy in Indonesia, the largest steam-power order ever awarded.

PLN operates three geothermal generation plants at Salak. UGI also delivers steam to DSPL for three other plants which supply electric power to PLN on behalf of Pertamina.

In mid-2002 Unocal Geothermal Indonesia (UGI) and Dayabumi Salak Pratama (DSPL), a 50% investee of UGI, signed a contract with PLN and Pertamina over pricing and production issues at the Gunung Salak project in West Java. This is a 330 MW geothermal steam and power generation project where UGI - as a contractor to Pertamina - operates the steam fields and delivers the output to PLN.

The mid-2002 agreement extended the contracts to 2040 and included a commitment from PLN to take as much steam and electricity as possible to meet burgeoning demand in the Java-Bali power distribution system.

The agreement also reaffirmed the government's guarantee of PLN's obligations to UGI, DSPL, Pertamina and Gunung Salak's lenders (see background in Vol. 60, No. 9).