Israeli power company Ormat Technologies announced on Monday the signing of a Heads of Agreement for the Sarulla Geothermal Project in Indonesia as part of a consortium of companies. Ormat's share in the $800 million project amounts to 12.75%.
According to the deal, which will be signed in the coming weeks, Ormat will supply the project with 340 megawatts. In addition, Ormat will be supplying one third of the equipment needed for the construction of the project.The company will invest $200 million in the project, over a period of 30 years.
The project is expected to take place in three stages, with the first stage being carried out in mid-2010, the second by the end of 2012 and the final stage will begin at the end of 2014.
Details on the funding for the project will be finalized by the end of the year, and the Japan Bank for International Cooperation is expected to be providing most of the funds.
Although Sarulla will be one of the biggest geothermal projects to be carried out in the industry so far, the project is not one of Ormat's largest, due to its relatively small role in the deal.
The project's revenues will be spread out between the years 2008-2012, with $40 million per year, and will be shown in the company's financial reports from the start of 2009.
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