The Medco-Ormat-Itochu Consortium, which consists of Medco Energi Internasional Tbk; Ormat International Inc., a subsidiary of Ormat Technologies, Inc. (NYSE: ORA); and the Itochu Corporation, have completed the execution of the project documents for the 340 MW Sarulla Geothermal Project in Indonesia.
The Project, located in Tapanuli Utara, North Sumatra, represents the largest single-contract geothermal power project to date, and is said to be representative of the large scale, high productivity and potential of Indonesian geothermal resources.
The Project will be owned and operated by the Consortium members under the framework of a Joint Operating Contract (JOC) with PT Pertamina Geothermal Energy (PGE).
According to a release it is to be constructed in three phases, consisting of Ormat designed and supplied power generating units of 110 to 120 Megawatts (MW) each, over the next five years. The first unit is scheduled to commence operation within 30 months of financial close, which is expected by the end of 2008. The remaining two units are scheduled to commence operation in stages within 18 months after the first unit’s scheduled commissioning.
The total project cost is expected to be approximately $800 million, and it is expected that the Japan Bank for International Corporation ("JBIC") will provide the majority of the project financing based. Ormat’s equity participation shall initially be 25%, and may be reduced to not less than 12.75%.
Power delivered by the project will serve the base load of state-owned Indonesian power company, PT Perusahaan Listrik Negara (PLN). Grid system and annual electricity sales revenue from the project is anticipated to be approximately $115 million when the full capacity is attained. The value of Ormat’s scope of supply for the project is expected to be over $250 million.
Lucien Bronicki, Chairman and CTO of Ormat Technologies, stated, "The execution of the Sarulla project documents is an important landmark for Ormat, as we will be providing our technology to Indonesia for the first time. We congratulate the teams of PLN and Pertamina, as well as our Consortium partners Medco and Itochu, and express our appreciation for their efforts that have contributed to the Consortium achieving this milestone. Our commitment to the development of geothermal resources in Indonesia is strong and we are pleased to be sharing our long experience in constructing and operating geothermal plants. Ormat’s air-cooled geothermal Combined Cycle technology, well proven over the last 15 years, is particularly suited to assure maximum utilization of the Sarulla resource in a sustainable manner."
About Ormat Technologies
Ormat Technologies, Inc. is a vertically integrated company primarily engaged in the geothermal and recovered energy power business. The Company designs, develops, builds, owns and operates geothermal and recovered energy- based power plants. Additionally, the Company designs, manufactures and sells geothermal and recovered energy power units and other power generating equipment, and provides related services. Ormat products and systems are covered by more than 70 patents. Ormat currently operates the following geothermal and recovered energy-based power plants: in the United States — Brady, Heber, Mammoth, Ormesa, Puna, Steamboat and OREG 1; in Guatemala — Zunil and Amatitlan; in Kenya — Olkaria; and in Nicaragua — Momotombo.
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