Indonesian oil subsidiary seeks to unlock geothermal potential in Kenya

Photo credit: Petromindo

Pertamina Geothermal Energy, a subsidiary of Indonesia's state-owned energy company Pertamina, is making progress on the development of two geothermal energy sites in Kenya. This method of generating power utilises the Earth's interior heat. It is estimated that Kenya possesses 10,000MW of untapped geothermal energy, spanning approximately two dozen locations across the country.

During a recent visit to Nairobi, a delegation from Pertamina held discussions with Kenyan state-owned Geothermal Development Company (GDC) to accelerate development of the Suswa geothermal field, located in the Narok area in the southwest of the country. In December, Pertamina announced a strategic partnership with GDC and Emirati renewable energy company Masdar to develop the Suswa field at an investment value of US$1.2bn. It is estimated the project could have a capacity of 500MW. The Indonesian major has completed preliminary studies on the Suswa field but additional exploratory drilling is necessary. Pertamina and GDC plan to sign a joint development agreement which will govern GDC's role in exploration at the first two wells through a government-backed drilling scheme and the possibility of further exploration at three other wells. 

Meanwhile, Pertamina has also agreed to establish a joint venture with Africa Geothermal International Limited (AGIL) for the development of the Longonot geothermal concession, located approximately 60km northwest of Nairobi. AGIL was granted a geothermal resource licence for the Longonot field back in 2009. The site offers a development potential of up to 500MW, with the initial phase of the project expected to come online by 2027.

Approximately a third of Kenya's total installed electricity generation capacity, or 950MW out of just over 3,000MW, comes from geothermal sources. It ranks as the world’s eighth-largest producer of geothermal energy, a process that taps into the Earth's subsurface heat and uses steam or hot water from underground reservoirs to generate electricity. The country's significant geothermal potential is due to its location along the East African Rift System, a tectonic boundary that brings the Earth's core heat closer to the surface, thus creating ideal geothermal conditions. The Rift Valley in Kenya offers an exceptionally cost-effective environment for geothermal extraction, where drilling depths for geothermal wells can be as shallow as 900m, compared to the global average of 3,000m to 4,000m. Geothermal energy's emission-free nature positions Kenya to leverage affordable climate financing for its electrification efforts.

In Indonesia, also known for its considerable geothermal potential, Pertamina manages 13 sites with a total capacity of 1,877MW. The company has indicated that its projects in Kenya are steps toward becoming a global player in the geothermal sector.

 

References

‘AGIL to drill its first geothermal well in Longonot, Kenya’, Renewable Energy Magazine, 01 February 2018

‘Kenya taps the earth's heat’, International Monetary Fund, December 2022

‘Energy-electrical power systems’, International Trade Administration U.S. Department of Commerce, 19 August 2023

‘Pertamina Geothermal Energy and Africa Geothermal International Limited have signed a partnership for geothermal development in Kenya, primarily in Longonot’, Think GeoEnergy, 21 August 2023

‘Indonesia's Pertamina Geothermal explores partnership with Kenyan firms’, Reuters, 22 August 2023

‘Pertamina Geothermal Energy explores collaboration with AGIL to develop Longonot concession in Kenya’, Pertamina, 22 August 2023

‘PT Pertamina Geothermal Energy, GDC, and Masdar join forces for US$1.2 billion Suswa Geothermal field project in Kenya’, Indonesia Business Post, 07 December 2023

‘Kenya: Electricity imports surge in 2023 as demand increases’, ESI Africa, 15 January 2024

‘Pertamina Geothermal Energy, GDC, and AGIL agree on accelerating 2 geothermal fields development in Kenya’, Pertamina, 08 March 2024

‘Our business’, Pertamina Geothermal Energy, Accessed 25 March 2024