Bali geothermal power project must go ahead: Purnomo

The controversial geothermal power project located in Batukaru forest conservation area in Bali must go ahead despite opposition from local people and a number of green activists, Minister of Energy and Mineral Resources Purnomo Yusgiantoro has said,Koran Tempo reported on Tuesday.

Speaking to reporters in Jakarta on Monday, the minister said the government had no reasons to suspend the project which had been widely criticized by some groups of people and non-governmental organizations in Bali.

"The project must go ahead. If we suspend the project, we could be taken to international arbitrary for breaching the contract," he was quoted as saying by Koran Tempo on Tuesday. "The contract should be honored, if we want be respected by other countries," he added.

Bali Energy Limited (BEL) in cooperation with state oil and gas firm Pertamina, is developing a geothermal power project in the Batukaru forest conservation . The project, more popularly called Bedugul geothermal project, was firstly begun in 1996 but its operator California Energy suspended the project following the financial crisis, which hit Indonesia in late 1997.

BEL which took over the geothermal power project from California Energy, was still testing a number of geothermal wells left behind by the American company.

BEL which received the government's approval to resume the project in 2003, was still processing all the necessary licenses and its AMDAL for the geothermal power plant.

Purnomo said that the US$10 million geothermal project would produce electricity with capacity of about 10 MW. The electricity will be sold to state owned electricity company PLN to cope with the power shortage in the Bali island. (*)