First Gen to fork out $80M for Indonesian geothermal foray

Lopez-led First Gen Corp. will bring in up to $80 million in initial investments to jumpstart its fresh venture in the Indonesian market.

Francis Giles Puno, president and chief operating officer of First Gen, said that aside from its expertise in the geothermal space, the group would likewise pour money into its partnership with PT DSSR Daya Mas Sakti, part of the Sinar Mas Group.

“Immediately, the first phase is probably around $30 million,” he told reporters in a recent event.

Development costs, which include drilling, meanwhile, may range from $30 million to $50 million.

According to First Gen Corp. vice president and Energy Development Corp. (EDC) chief finance officer Erwin Avante, the group was lining up an initial portfolio of six geothermal projects.

To recall, FirstGen Geothermal Indonesia last month entered into a pact with DSSR to further unlock Indonesia’s geothermal power.

PT FirstGen Geothermal Indonesia is a unit of EDC, which serves as First Gen’s renewable energy arm. It has solar, wind and geothermal power businesses.

DSSR, on the other hand, is a subsidiary of power and infrastructure giant PT Dian Swastatika Sentosa Tbk.

Puno expressed confidence in the venture given Sinar Mas’ presence in the local industry there.

“[It is] a very large conglomerate … very established. So, between what First Gen can bring to the table and then what Sinar Mas can bring to the table, that’s a very formidable partnership to develop geothermal in Indonesia,” he said.

As it focuses on the Philippines and Indonesia, the official said First Gen was not actively exploring other opportunities abroad.

However, he said that once an opportunity presents itself, “we will look at it.”

“We want to have a very strong footprint in geothermal, not only in the Philippines, but in other countries as well,” he added.

The group is banking heavily on its geothermal expansion to hit its target of 13 gigawatts by 2030.