Pertamina Geothermal Energy (PGE) (PGEO.JK), a unit of Indonesian state energy firm Pertamina, has signed initial agreements with two Kenyan companies to explore partnerships in geothermal power projects, Indonesia’s foreign minister said.
PGE signed a memorandum of understanding (MoU) with Geothermal Development Company to explore a partnership that could be worth $1.5 billion, and a separate MoU with Africa Geothermal International No. 1 Ltd (AGIL No. 1) for a potentially $700 million deal, Retno Marsudi said.
The deals were signed on the sidelines of President Joko Widodo’s visit to Kenya.
“This kind of cooperation is very important to pave the way for other energy cooperation, including in the upstream oil and gas sector and new and renewable energy,” Retno said in a video statement late on Monday.
PGE on Tuesday said its agreement with AGIL is aimed at development in the Longonot concession in Kenya which could yield up to 500 megawatts (MW) of geothermal power, of which 140 MW is ready to be exploited.
PGE parent Pertamina also signed an MoU to explore partnership potential with National Oil Corporation of Kenya during the same trip.
“The Bilateral Agreement Treaty which will also be summarized in the next 3 Months, will witness a sound investment strategy that will firmly establish the two nations on the value-adding chain and open up new investment opportunities in Kenya,” Moses Kuria, Cabinet Secretary for Investments, Trade and Industry.
The MoU will be “focusing on strengthening our partnership in the edible oils, textile industry, energy, medical field among other areas of mutual interests.”
“We have committed ourselves to completing the Preferential Trade Agreement within 90 days to create opportunities for the investors who will engage in business both Indonesia as well as in Kenya,” he added.
