Panax updates Indonesian geothermal project
Friday, January 28 2011 - 08:42 AM WIB
Sokoria
Panax has completed the acquisition of a 45% equity in PT Sokoria Geothemal Indonesia (SGI), the owner of the of the advanced Sokoria Geothermal Project in Flores through the execution of a "Share Sale and Purchase Agreement? with PT Bakrie Power (53%) and with PT Energy Management Indonesia (?EMI?), (2%). A comprehensive ?Shareholder Agreement? which contains the terms and conditions of the incorporated SGI joint venture was also executed. Panax is the ?Operator? of this project until the completion of a feasibility study and the ?Development Decision.? Panax is currently reviewing a formal draft Sokoria Power Purchase Agreement (?PPA?) as approved by PLN ,the Indonesian electricity regulation and distribution. The appointment of a Project Manager for the Sokoria project (as part of the Panax Management team) is expected in the current quarter. Further meetings with our Indonesian partner as well as with Indonesian authorities are planned for the current quarter, Indonesia electricity regulation and distribution.
The appointment of a Project Manager for the Sokoria project (as part of the Panax Management team) is expected in the current quarter including with local government officials in Ende, the capital of Flores and a visit to the Sokoria geothermal field. Further details of the Sokoria Project and its development plans are contained in the ?Operation" section of this report.
Dairi Prima Geothermal Project
As previously reported, Panax and Bakrie have agreed to a Binding Terms Sheet Agreement with PT Dairi Prima Minerals ("PTDPM?), a subsidiary of the listed Bumi Resources Group for the supply up to 25 MW of geothermal power for PTDPM?s planned underground Dairi Prima lead/zinc mine in Northern Sumatra at attractive tariffs including US$150 MWh for first eight years.
We have recently been advised that the development time for the underground Dairi Prima mine is budgeted at 30 months. All development permits are now in place and following the issue of the regional ?Presidential Decree? development will commence.
The Sibayak Project is one of the oldest established geothermal projects in Indonesia and is located some 40km to the north-east of the Dairi Prima mine site. It is the most advanced geothermal field in the region and includes 10 production wells. The Sibayak geothermal field is operated by PT Pertamina Geothermal, who supplies steam to the current plant operator at the site. Total installed capacity currently stands at 10.6 MW (two units of 5.3 MW), but the field is underutilised and also suffers from plant mechanical problems. Regarding the development of spare capacity of the Sibayak geothermal field, progress was made in meetings with both the operator of the geothermal field as well as with the local geothermal power plant operator.(end of edited exceprt)