PGE and GDC have announced a plan to sign a Joint Development Agreement (JDA) that will regulate the role of GDC in the exploration of the first two wells in Susa through a government drilling scheme and the possibility of further drilling of three more wells to be carried out by PGE. The implementation of this JDA is being targeted by mid-2024, with GDC aiming to start drilling by the end of 2024 or 2025.
According to Rachmat Hidajat, PGE Exploration and Development Director, a feasibility study will be prepared after exploratory drilling which will be the basis for negotiating for a power purchase agreement at a reasonable rate. The long-term plan is to develop the Suswa geothermal field in stages with four power plant units, each with a capacity of 50 MW, thus harnessing the total 200 MW resource potential of Suswa. The target commercial operations date for Suswa Unit 1 is in 2027.
The PGEO delegation was led by President Director Julfi Hadi and accompanied by PGE Exploration and Development Director Rachmat Hidajat. Present at the meeting were GDC Chairman Hon. Walter Osebe Nyambati and GDC Managing Director & Chief Executive Officer Paul Ngugi.
The $1 billion deal for development of the Suswa geothermal field in partnership with PGEO with the backing of UAE-based Masdar was part of the package of geothermal deals in Kenya announced during COP28.
Progress on the AGIL deal for Longonot
During the same trip, the PGEO delegation also met with the team from Africa Geothermal International Limited (AGIL) to discuss a number of technical aspects following up on the signing of an MOU between the two parties to jointly develop the Longonot geothermal field in Kenya.
According to the agreement, PGEO will carry out exploration drilling for a target 35 MW of capacity which will be operational by 2027. PGEO and AGIL have also agreed to negotiate for a power purchase agreement for 140 MW of total capacity.
PGEO had initially announced plans of acquiring geothermal blocks in Africa in mid-2023 as part of the company’s international expansion efforts. Aside from Kenyan companies, PGEO had also signed an agreement with Turkish energy company Kipas Holding at the start of 2024.
