Sarulla Operations Ltd. signed operations and energy sales contracts for the 330 MW Sarulla geothermal power project in Tapanuli Utara, North Sumatra in Indonesia.
Ormat Technologies designed the power plant and will supply it with geothermal energy converters. Ormat International Inc. holds a 12.75 percent equity stake in the Sarulla Operations, which owns and operates the Sarulla project.
As a supplier, the company expects to recognize revenues of $254 million related to the equipment sales over the construction period. Other members of the consortium include Medco Energi Internasional Tbk; Itochu Corp.; and Kyushu Electric Power Co. Inc.
Under the operations contract, PT Pertamina Geothermal Energy, the concession holder for the project, has provided Sarulla Operations with the rights to use the geothermal field and under the ESC PT PLN, the state electric utility will be the off-taker at Sarulla for 30 years.
The Sarulla project is the largest single contract geothermal power project to capitalize on the large-scale potential of highly productive Indonesian geothermal resources. The project will be implemented in three phases of 110 MW each, utilizing both steam and brine extracted from the geothermal field to increase the power plant’s efficiency.
The Ormat technology was selected for this project as it maximizes the efficient use of varied composition of geothermal fluid, which in this case includes steam, brine and gases. Ormat’s technology allows practically 100 percent reinjection of the geothermal fluid back into the reservoir, maintaining the sustainability of the geothermal resource thus increasing power and mitigates the negative effect of gases.
The consortium has started preliminary testing and development activities at the site. Construction is expected to begin after the consortium obtains financing, which is expected to take about one year. The first phase is scheduled to commence operation in 2016. The remaining two phases are scheduled to start within 18 months of the first phase.
Ormat’s current generating portfolio of 575 MW includes geothermal energy projects deployed in the U.S., Guatemala, Kenya and Nicaragua.