Energy Development Corp. (EDC) expects to spend up to $80 million on the first phase of its 440-megawatt drilling prospect in Indonesia.
PT FirstGen Geothermal Indonesia, an EDC subsidiary and part of First Gen Corp., entered into an agreement to establish a joint venture with PT DSSR Daya Mas Sakti, a subsidiary of PT Dian Swastatika Sentosa Tbk, which is part of Sinar Mas. The goal is to develop geothermal projects in Indonesia.
“The first phase is probably around $30 million,” said Francis Giles Puno, president of First Gen. “It’s like the start. And then after that, we will have to enter into a drilling campaign. And if the drilling campaign is similar to what we have here, then that’s big. Another $30 million to $50 million for drilling alone.”
EDC expects to spend $30 million this year to balance the contribution of each party in the joint venture, with an initial drilling or development cost of around $30 million to $50 million likely next year.
Puno, who is also vice chairman and chief executive of EDC, said the two companies combined their respective concessions to form a 50-50 joint venture.
“That way, we can develop more jointly. And it’s important in Indonesia to have a good local partner,” Puno said. “Sinar Mas is a very large conglomerate there. Very established. So, between what First Gen can bring to the table and then what Sinar Mas can bring to the table, that’s a very formidable partnership to develop geothermal in Indonesia.”
Puno said the company has concessions in Peru and Chile, but the focus for now is Indonesia because it has the largest potential for geothermal energy.
“The decarbonization of Indonesia is really just starting because basically they are very reliant on coal,” he said. “If a company like First Gen can help a champion like Sinar Mas and the Indonesian government to develop more renewable energy sources that’s cost-competitive, then that’s a good start as far as enlarging the renewable energy footprint in a country like Indonesia.”
The joint venture agreement, signed in August, marked the beginning of a collaboration to transfer global expertise, enhance domestic capacity and unlock Indonesia’s vast geothermal potential to support the country’s energy transition agenda.
Indonesia holds about 40 percent of the world’s geothermal reserves, equivalent to 24 gigawatts, but only about 10 percent has been developed.
First Gen said that through this partnership, PT DSSR Daya Mas Sakti and PT FirstGen Geothermal Indonesia aim to accelerate the development of geothermal resources that will contribute to national energy security and provide a sustainable source of clean power.
The joint venture will focus on developing and managing geothermal resources with a combined potential of about 440 MW across six strategic fields in West Java, Flores, Jambi, West Sumatra and Central Sulawesi.
“This agreement goes beyond investment. It is a strategic collaboration to bring world-class knowledge and best practices from EDC to Indonesia,” said Lokita Prasetya, president director of PT DSSR Daya Mas Sakti and vice president director of PT Dian Swastatika Sentosa Tbk. “Our goal is to strengthen national capacity in geothermal development and to fully harness the country’s natural potential for clean energy. Together, we aim to create real value for communities, the economy and the environment.”
Reinforcing this goal, EDC, through PT FirstGen Geothermal Indonesia, emphasized that the partnership reflects a shared mission to advance Indonesia’s energy transition.
Recognized as the largest vertically integrated geothermal company globally, the collaboration provides EDC an opportunity to apply its global expertise in geothermal development to strengthen Indonesia’s renewable energy capacity and contribute to a cleaner, more sustainable energy future.
“EDC has decades of experience in harnessing geothermal energy in the Philippines, and we are proud to share this expertise with Indonesia through our partnership with DSSR,” Puno said. “By combining EDC’s global capabilities with DSSR’s strong local presence, this joint venture will not only develop projects but also build capacity and transfer knowledge that will leave a lasting impact on Indonesia’s renewable energy sector.”
This collaboration is aligned with the government of Indonesia’s strategy to accelerate the country’s energy transition, expand the share of renewable energy and achieve the nation’s net-zero emissions target by 2060.
