Tata, Chevron bid for Indonesian geothermal project

JAKARTA, March 17 Wed Mar 17, 2010 7:29am GMT

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JAKARTA, March 17 (Reuters) - India's Tata Power Co Ltd (TTPW.BO) and Chevron Corp's (CVX.N) Indonesian unit are among several firms which have submitted bids for a geothermal power project in Indonesia, a ministry official said on Wednesday. Indonesia's PT Medco Energi Internasional (MEDC.JK) is part of a consortium with Ormat Technologies (ORA.N), and several other local firms made separate bids for the project.

Tata, India's largest private-sector utility, is part of a consortium with Indonesian firm PT Supraco Energy.

The bids are to build a geothermal power plant in Sorik Merapi, North Sumatra, with initial capacity of 55 megawatts (MW) gradually increasing to 200 MW.

"This is a preliminary bid, the government will look carefully at the capabilities of the firms before deciding on the winner," said the official at the energy and mines ministry, who declined to be quoted by name.

Indonesia has launched the first phase of the programme to add 10,000 MW of generating capacity from 35 new coal-fired power plants, which are mostly still under construction.

The government is still finalising the second phase of the crash programme to add another 10,000 MW using coal, geothermal and renewable energy resources.

Indonesia, with hundreds of active and extinct volcanoes, has the potential to produce an estimated 27,000 MW of electricity from geothermal sources.

However, that potential remains largely untapped because the high cost of geothermal energy makes the price of electricity generated this way expensive. (Reporting by Muklis Ali; Editing by Sara Webb)

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