BP to hunt for geothermal energy in Indonesia

Indonesia’s President said the world’s third largest energy company will help Indonesia develop its geothermal resources.

President Susilo Bambang Yudhoyono announced that British Petroleum (BP) has agreed to take part in the development of multi-billion dollar geothermal energy projects throughout the country.

"BP . . . agreed to participate in the development of geothermal energy in Indonesia thus to increase our power capacity," President Yudhoyono said.

He noted the agreement was the result of his talks with BP CEO Bob Dudley in Indonesia. The president said geothermal energy has not been sufficiently exploited so far despite Indonesia having the world`s biggest reserves.

He said geothermal energy has not yet been developed due to investment challenges. The oil subsidy had also made the price of geothermal energy uncompetitive, according to the President.

Indonesia had a total power generation capacity of 28,462 MW from all sources in 2011. Coal-powered plants account for around 42% of that capacity; diesel-fired plants 24%; natural gas 22%; hydropower plants 6.7% and geothermal and other renewable energy 5.4%.