Panax updates Indonesian geothermal project

Australian firm Panax Geothermal has released its 2010 first quarter report. The following is an excerpt of the report on the company?s project in Indonesia.

Panax has been actively pursuing its interests in Northern Sumatra, which are linked to the future supply of geothermal power to the PT Dairi Prima zinc/lead underground mining project.

A number of prospective geothermal resources have been identified, including one advanced ?brown field? project. Discussions with a number of Indonesian companies to advance our interests in this prospective geothermal region have been encouraging and follow-up is planned for the near future.

Panax had a number of meetings with representatives of geothermal power generation companies in Indonesia. regarding joint venture opportunities in Sumatra and other parts of Indonesia.

Indonesia currently has a total installed generating capacity of 1062 MW of geothermal power ? the third largest producer of geothermal energy in the world. In addition to this, Indonesia has a geothermal resource potential of an additional 10,000 to 27,000 MW, equivalent to 15-40 coal fired power stations (source; Emerging Energy Research, May 2009). Indonesia recently passed legislation which allows private companies to develop power generation in areas remote from the grid, i.e. direct from generator to consumer.

As a follow-up, Panax completed an in depth reconnaissance visit to North Sumatra in early April 2010, to evaluate potential geothermal project locations and proposed geothermal development sites for the future supply of base-load power to the PT Dairi Prima highgrade, zinc,lead mining project in the area, and also for possible supply to other off-takers in the region.

This second visit was followed up by a number of encouraging meetings with well established geothermal energy companies in Jakarta, with a view to a joint development of advanced geothermal projects in Northern Sumatra.

The Dairi Prima underground zinc/lead mining project is ready for development, subject to final permitting. The electricity requirements for this off-the-grid? mine can be met by a power plant with a 20 MW to 30 MW installed capacity. As previously reported, Panax has a Memorandum of Understanding with Dairi Prima regarding possible future geothermal power supply.

The area surrounding the Dairi Prima Mining Project hosts numerous geothermal prospects associated with Quaternary volcanic centres along the Sumatran transcurrent fault. The relatively shallow geothermal resources can be accessed through 2000 metre deep wells, some of which are known to have the potential to produce up to 30 MW per well. (end of excerpt)