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Ephindo and GEs Coal Bed Methane-to-Power Project will Help Indonesia Meet its Growing Power Needs
Friday, November 05, 2010 by GE Energy

Indonesia's leading coal bed methane (CBM) company, Ephindo has signed a memorandum of understanding (MOU) with GE to develop a pilot power generation plant that will tap into the country's vast reserves of coal methane gas to produce electricity using cleaner burning power generation technology. The new project will help the region end the use of diesel fuel as the primary fuel source to operate its power plants. The first of its kind project is part of a broader GE strategy to invest in resource rich regions like Indonesia to respond more quickly to customer needs. Joining Ephindo in the development of the 1MW pilot CBM-to-power project, GE will be deploying its Jenbacher gas engine technology to support Indonesia's environmental and energy efficiency goals. Total energy demand in Indonesia is growing 7% per year and currently, up to 40% of power generation in the country is still coming from diesel fuel. Indonesia has the third largest CBM reserve in the world so the Indonesian government plans to focus more on using these resources to reduce the country's dependency on subsidised fuel.

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2/13/2012

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Ephindo CEO, Sammy Hamzah said: "Indonesia has been a net importer of oil since 2004 and although it is currently the world's third largest exporter of liquefied natural gas, conventional domestic gas supply is projected to decrease by 2020. For this reason the Indonesian government is encouraging investors in commercialisation of CBM to Power. GE's advanced technology and expertise in this industry is very important to the success of this project, which will support the country's goal to reduce dependency on subsidised fuel and help to diversify its primary energy needs beyond imported petroleum products." GE will finance and develop the one megawatt pilot plant, which will be located at the Sangata field in East Kalimantan, Indonesia. It will feature GE's Jenbacher J320 gas engine technology, which has been successfully used in CBM-to-power markets around the world. If the pilot plant is proven commercially viable, the project could be expanded when the 21 CBM production sharing contracts go into operation in the future. The production sharing contracts are spread across four main areas in Sumatra and Kalimantan. Gas engines for GE power and water CEO, Prady Iyyanki, said: "GE's investment in this project is consistent with our company-wide ecomagination initiative to help meet customers' demands for more energy-efficient products. Our Jenbacher technology is harnessing the gas directly from the coal seams as an energy source and can reduce the release of methane into the atmosphere by about 85% compared to venting the gas as is usual in a coal mining operation. This corresponds to a CO2 savings of about 30,000 tons per MW and year." The signing ceremony was witnessed by Indonesia's director general of renewable energy, Luluk Sumiarso and Indonesian ambassador to Federation Republic of Germany, Eddy Pratomo in Berlin, Germany.

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2/13/2012

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GE currently has Jenbacher units with a total capacity of more than 400MW running on this type of gas and generating more than three million MWh of electricity per year around the world. This saving is the equivalent of 830 million cubic meters of natural gas a year, which is enough to power 2.2 million Indonesian homes. The four-well pilot drilling programme is expected to begin this month and commercial operation is scheduled for the third quarter of 2011. Eventually, it is expected that this CBM-to-power project will be connected to PLN's (Indonesia's national power producer) grid to improve rural electrification in remote areas. CBM gas occurs naturally within coal deposits and is composed largely of methane, the principal component of natural gas. Compared to natural gas, CBM burns more efficiently and delivers considerable cost savings in extraction. Potential Indonesian reserves of CBM are estimated at 450 trillion cubic feet, almost three times the country's current reserves of natural gas. Ephindo is a pioneer in the exploration of CBM in Indonesia. The Indonesian company works with the world's leading experts in CBM. Ephindo CBM brings together a powerful team of professionals who are rich in oil and gas extraction experience and have the entrepreneurial spirit to search for and develop a significant new source of energy for Indonesia in the form of CBM. Ephindo was granted the first production sharing contract for CBM in Indonesia in May 2008, with others soon following. Already of huge importance in the US and Australia, CBM is making its debut in Indonesia and Ephindo is leading the way. Similar to India and China, Indonesia is now beginning to harness this important future energy source. This announcement continues a series of recent actions in GE's energy business aimed at growing its overall presence in the global energy space. On 1 October 2010, GE announced its purchase of

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Calnetix Power Solutions, which expands GE's capabilities to recover waste heat from industrial processes for electricity generation. On 6 October 2010 GE announced the acquisition of Dresser, a global energy infrastructure technology and service provider. On 19 October 2010 GE announced the development of its new, larger, powergeneration J920 gas engine. The new engine is the most efficient in its class with electrical efficiency of 48.7% and an output of 9.5MW and it extends GE's technical leadership in power generation gas engines. (1) Ministry of Finance Green Paper: Economic and Fiscal Policy Strategies for Climate Change Mitigation in Indonesia Page 2 of 3 GE (2) ephindo.com

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2/13/2012