PLN, Pertamina reach agreement over geothermal steam price

State-owned electricity company PT PLN and state-owned oil and gas firm PT Pertamina have finally reached agreement on the price of geothermal steam supplied by the latter to the former?s Kamojang power plant in West Java.

?(Price negotiation) has been completed. The selling price of the steam for the Kamojang geothermal power plant is 6 US cents per kWh. It?s final, and has been accepted by the two firms,? said Edwin Hidayat, a deputy at the Office of the State Minister of State Owned Enterprises, on Thursday as reported by Antara.

He said that the price agreement has been reached at a negotiation meeting between the two state firms facilitated by State Minister of State Owned Enterprises Rini Soemarno.

PLN and Pertamina had previously been engaged in an ugly dispute over the steam price as both continued to fail to reach price agreement for the geothermal steam supplied by Pertamina to PLN?s Kamojang geothermal power plant unit 1, 2, and 3 with a combined capacity of 140 MW.

PT Pertamina Geothermal Energi, a subsidiary of Pertamina, reportedly had set up a new price of 9 US cents per kWh for the steam to be supplied to PLN?s Kamojang power plant over the next five years. PLN then protested what it described as excessively high price, saying that the fair price was 4 US cents per kWh. PLN threatened to stop buying the steam if Pertamina declines to lower the price, while Pertamina also threatened to stop supplying the steam if PLN did not agree to the price. (*)