NAIROBI, Kenya, April 3 – Geothermal Development Company (GDC) has reached a deal with PT Pertamina Geothermal Energy Tbk (PGE) to develop two geothermal fields in Kenya.
The agreement also involves Africa Geothermal International Ltd. (AGIL) and is expected to commence this year.
GDC and PGE, during a meeting held early last month, discussed support for expediting field development projects in Suswa, Narok County.
The PGE delegation was led by its President Director, Julfi Hadi, and Director of Exploration and Development, Rachmat Hidajat, with GDC represented by its chairman, Walter Nyambati, and Managing Director and Chief Executive Officer, Paul Ngugi.
Hadi also met with AGIL directors Patrick Nyoike and Ephraim Maina.
According to Hadi, the meetings in Nairobi were a follow-up to the initial agreements reached with GDC and AGIL in 2023.
PGE and GDC signed a Non-Disclosure Agreement (NDA) on September 15, 2023, for geothermal potential development in Kenya and Indonesia.
Earlier, on August 22, 2023, PGE and AGIL signed a Memorandum of Understanding (MoU) for the Longonot geothermal field development located in the Great Rift Valley region of Kenya.
One of the main agenda items of the follow-up meeting with GDC was to discuss the initial technical studies conducted by PGE on the Suswa field, which is estimated to have a resource potential of 200 MW.
However, further studies are needed to confirm the magnitude of this potential through exploration drilling.
Therefore, PGE and GDC have planned to sign a Joint Development Agreement (JDA) that will govern GDC’s role in exploration at the first two wells through a government drilling scheme and the possibility of further exploration at three other wells to be conducted by PGE.
“We target the implementation of the JDA by mid-2024, with GDC’s drilling target by the end of 2024 or early 2025,” said Hadi.
The gradual development acceleration of the Suswa Field will involve four units of geothermal power plants, each with a capacity of 50 MW, with a target commercial operation date (COD) for unit 1 in 2027.
The main target is to make the Suswa project a world-class geothermal field with a capacity of 500 MW.
Meanwhile, PGE and AGIL have also agreed on several technical aspects, including the establishment of a joint venture to develop the Longonot field.
Moreover, the duo have agreed to a power purchase agreement of 140 MW, and for the initial phase, PGE will conduct exploration drilling of 35 MW targeted to be on stream by 2027.
“To accelerate the implementation of this agreement, the parties will sign a definitive agreement after obtaining internal corporate approvals,” said Julfi Hadi.
