US Company Wins Halmahera Geothermal Project Auction

Background and Auction Results

The Indonesian Ministry of Energy and Mineral Resources (ESDM) has announced that PT Ormat Geothermal Indonesia, a subsidiary of Nevada-based Ormat Technologies, Inc, has won the auction for the Telaga Ranu geothermal working area (WKP) in West Halmahera, North Maluku. The official announcement was made through Ministerial Decree No. 8.K/EK.04/MEM.E/2026 dated January 8, 2026, as stated in the Ministry's announcement No. 1.Pm/EK.04/DJE.P/2026.

Obligations and Requirements

As per the auction terms and existing regulations, PT Ormat Geothermal Indonesia is required to fulfill several obligations. The company must pay the base price of the working area data as non-tax state revenue within four months from the decree date. Additionally, they must establish an exploration commitment with a state-owned bank within the same timeframe. For companies not specifically established for managing geothermal projects, they are required to either form a new entity or modify their existing articles of incorporation, with the new entity needing to have at least 95% ownership by the winning bidder.

Regulatory Framework

The auction and subsequent obligations are governed by Government Regulation No. 7/2017 regarding Geothermal Utilization and ESDM Ministerial Regulation No. 37/2018 concerning Geothermal Working Areas and Geothermal Business Licensing. These regulations provide the legal framework for geothermal development in Indonesia and outline the requirements for project execution and compliance.

Significance for Renewable Energy Development

This geothermal project represents a significant development in Indonesia's renewable energy sector, aligning with the country's commitment to expanding its clean energy capacity. The project will contribute to Indonesia's renewable energy targets and help reduce dependence on fossil fuels. The involvement of international companies like Ormat Technologies brings in technical expertise and investment crucial for developing Indonesia's geothermal resources.