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Geothermal Drilling in Indonesia: a Review of Drilling Implementation,

Evaluation of Well Cost and Well Capacity

Conference Paper · September 2018

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PROCEEDINGS, The 6th Indonesia International Geothermal Convention & Exhibition (IIGCE) 2018
Cendrawasih Hall - Jakarta Convention Center Indonesia, September 5th - 8th, 2018

GEOTHERMAL DRILLING IN INDONESIA: A REVIEW OF DRILLING OPERATION,

EVALUATION OF WELL COST AND WELL CAPACITY

Eko Hari Purwanto, Eko Suwarno, R. Fitrah Lukman and Budi Herdiyanto

Directorate of Geothermal, Ministry of Energy and Mineral Resource, Indonesia

e-mail: eko.hari@esdm.go.id

availability, well costs and well productivity.

ABSTRACT
The composition of geothermal electricity price is
strongly influenced by the main components of the
exploration, development and installation of steam
field facilities and power plants. Studies show that
well costs account for almost up to 60% investment
of geothermal projects, therefore effectiveness of
geothermal drilling is essential in order to achieve
desired projects economics.
This paper presents a short history of geothermal
drilling operation in Indonesia and review of
geothermal drilling operation and offers statistical
study of geothermal well costs and well capacity of
geothermal fields in Indonesia. Review of drilling
operation covers types of wells, casing design,
common acquired depths, commercial/ contract
schemes and operational difficulties in order to
achieved desired drilling targets. This paper also
evaluates drilling problems and Non-Productive
Time in several wells in Indonesia.
This study performs well cost comparison with
reference to drilling conducted from 2011 to 2018
using statistical charts in order to illustrate the
trend of drilling costs in Indonesia.
Evaluation of the geothermal wells is conducted to
understand depth ranges, average well output and
drilling success rate.
1. INTRODUCTION
Geothermal energy originates from the heat energy
contained in underneath the earth crust and is
generally associated with the presence of
volcanoes. Indonesia is tectonically located in the
area of plate tectonic collision that resulted in
hundreds of volcanoes that are spread in Indonesia
volcanic belt from Sumatera to Eastern Indonesia.
Until 2017, the Geological Agency of Indonesia
has identified 342 geothermal prospect locations
with a total of 28,508 MW of resources. However
until now the utilization of geothermal power
generation up to June-2018 is around 1948.5 MW
which only accounted for 6.8% of the total
resources (MEMR, 2018).
Geothermal developers believe that one of the main
factors that inhibit geothermal development is the
high risk of upstream. Sanyal (2014) identifies that
upstream risk is substantially affected by resource
According to Hochstein & Sudarman (2008), the
risks on the upstream are smaller with the addition
of development stages. At the exploration stage,
drilling the first well will reduce the risk to 40%
and drilling the second well will lower the risk to
30%. Furthermore, drilling a third to fifth well will
reduce the risk further of development to only 20%.
Several studies show that geothermal drilling is
responsible for up to 60% of project cost for
geothermal projects worldwide (Lukawski et al
2004; Finger & Blankeship 2006). Gehringer and
Loksha (2012) explains that in Iceland, exploration
and development drilling accounts for up to 34%
for geothermal power development while a study
case of 50 MW geothermal projects estimate that
45% of investment costs are contributed by
drilling.
In Indonesia, case studies of cost distributions for
geothermal projects in Indonesia shows that
drilling accounts for 46 and 58% of geothermal
projects using a 5 and 55 MW projects respectively
(ARUP, 2017). Other study which presented by
Quinlivan (2017) show that total of exploratory,
appraisal and development drilling accounts up to
36% of geothermal power generation project.
Historically in Indonesia, geothermal well costs are
rarely been published due to confidentiality and
proprietary nature of data therefore it is difficult
and insufficient to evaluate well cost to a
reasonable statistical confidence. However there is
demand from geothermal industry and research in
Indonesia to provide evaluation of well costs and
well productivity to support desired geothermal
projects economics with aims to accelerate
geothermal power development in Indonesia.
2. EXPLORATION DRILLING HISTORY
The exploration of geothermal resources in
Indonesia began in 1920s through geochemical
prospecting in Kamojang area by the
Volcanological Survey of Indonesia, which is
followed by exploration drilling to a depth of 128
m (Hochstein & Sudarman, 2008). However the
exploration only began to experience a significant
increase since 1974, marked by drilling in several
field, such as Kamojang, Dieng and Darajat. In
Kamojang, drilling activities continued
progressively with a development well drilling at
KMJ-6 (611 m deep) in 1974.
In Dieng, geoscientific survey and shallow drilling
were conducted from early 1960s by UNESCO,
United States Geological Survey and French
contractor BEICIP which then followed by
extensive production drilling in 1977-1994 by
PERTAMINA which covered Sikidang and Sileri
prospects. In Darajat, first exploration drilling
DRJ-1 conducted in 1976 to 760 m (Hochstein &
Sudarman, 2008; Layman et al, 2002).
Geothermal drilling activity in Indonesia has grown
progressively from 1980 as shown in Figure 1.
Figure 1: Geothermal drilling activity in Indonesia
from 1970s to June 2018
Geothermal Drilling increased from 1990-1995
which may be caused by assignment by the
Government to PERTAMINA on almost of
Indonesia geothermal working area (GWA) and
implementation of Joint Operating Contract (JOC)
following Presidential Decree 22 of 1981 and 49 of
1991 which enable private companies to participate
in geothermal enterprising, in which at least 7
Energy Sales Contract (ESC) were signed between
JOC and PT PLN. Positive trend peaked at late
1990s to 2000 where Government enacted
Presidential Decree 39 of 1998 due to fiscal and
monetary reason, which halted several projects.
The second period of is peaked in 2011-2015
where at least 10 ESC were signed with PT PLN.
During the period of 1995-2000, several
exploratory drilling in Indonesia is carried out by
employed temperature gradient core hole drilling
(TCH). TCH well is drilled mainly using a small
sized-casing to a depth of less than 1100 m to 1300
m. The purpose of TCH is to gather information of
temperature gradient and other subsurface
geological information before proceeded to drill
further large sized well in the prospect area. This
scheme is carried out mainly by JOC operator in
Karaha, Dieng, Patuha, and Bedugul. As examples,
18 TCH well is drilled in Karaha whereas 17 TCH
well is drilled in Patuha.
However from 2005 to date, the number of
exploration drilling which is carried out by
geothermal developer ranges reduced to minimum
1 to 3 wells, with an average of 5 exploration wells.
This is done by taking into account exploration
strategy which is used by the geothermal
developers are commonly targeted to reach a depth
of reservoir to confirm geothermal resources
existence and conceptual model obtained from
geoscientific surveys. Therefore if the exploration
well is successful, it can also be used as production
well. Until June 2018, Indonesia has at least 711
geothermal wells that were drilled by State owned
enterprise (SOE), JOC contractors and other private
companies. Well data containing number of wells,
maximum drilling depth, maximum temperature,
reservoir depths and field well output are presented
in appendix A. This numbers does not include
temperature gradient wells which were conducted
by Geological Agency of Indonesia.
3. WELL DESIGN
Well targeting is prepared in order to confirm
geoscientific model then exploratory well is
designed to achieve certain depths as required by
geoscientists. Planning in drilling activities is very
important because it requires experience and
engineering in its implementation with the aim of
achieving the expected reservoir target by keeping
in mind the safety aspect and at the cost of being
economical as possible.
Well sitting in geothermal wells require some of
major consideration such as topography and civil
aspects, environmental impact, target feed zone,
geological hazard and cost influence.
The Indonesian government has determined the
definition, size and objectives of geothermal wells
through the Indonesian National Standard (SNI)
7985 of 2015. In the case of well design, well
criteria can be divided based on the size of the
production casing. There are three types of well
design in Indonesia which have been used by
geothermal industry namely large wells (big hole),
standard hole and slim hole. Slim hole and standard
hole commonly is used for exploration purposes,
whereas big hole design is mainly used for
development and production purposes.
To compare well design for different well which
are used in Indonesia, 60 well designs from 11
fields in Sumatera, Java and Sulawesi are gathered
as references in order to obtain common well
design and depths information. Figure 2 shows the
typical size of the well along with depth interval of
the design casing of geothermal wells in Indonesia.
For large diameter wells (big hole) installation of
casing 30 is generally done using auging/ crane.
The next sections are drilled by a drilling rig with a
26" bit with a depth interval of 170-650 mMD for
20" casing installation. The next section is drilled
using a 17-1/2" bit with 400-1400 mMD depth
interval to install 13-3/8" casing. The next sections
are drilled using 12-1/4” bit at 1050-2400 mMD
intervals for the installation of 10-3/4 " production
liners. Last section is carried out by drilling using a
9-7/8" bit with an interval of 1550-3000 mMD
which is cased by 8-5/8” production casing and 7”
slotted production liner.
 Figure 2 : General well design and interval depth of geothermal wells in Indonesia
For standard hole (regular diameter), the depth
sections are similar but diameters of casing are 18-
5/8” for surface casing, 13-3/8” for anchor casing.
For standard hole cases, the examples are taken
from 3 exploration wells in Sorik Marapi and 2
exploration wells in Baturaden, the installation of
casing 30” covers 30-40 mMD depths and are
further covered by 18-5/8 casing which are
installed in interval 150-165 mMD. The next
sections are covered by 9-5/8” production casing in
interval 750-900 mMD which are followed by
installation of 7” production liner at depth 950-
3500 mMD (Isa et all, 2017; Sasongko, 2017).
Several deep slim hole has already been drillied in
the early 1990s. The latest slim hole drilling is
implemented in 2 exploration wells in Blawan Ijen.
The operation is carried out using core drilling rig
to achieve 2000 mMD depth (Rahman and Subroto,
2017).
Slim hole drilling is suitable for high risk
geothermal prospect exploration with following
condition: high resources uncertainty, difficult
access and small capital budget. However deep
slim hole drilling may need longer drilling time due
to technical issues occurred during drilling which
are mainly resulted by lack of specific deep slim
hole drilling knowledge and inadequate drilling
design.
4. DRILLING COMMERCIAL SCHEMES
Geothermal enterprising involves high capital
which resulted in uprising risk, therefore high
expenses should be mitigated. In exploration side,
specifically in drilling it is important to keep cost
as low as possible. In Indonesia at least four
drilling schemes/ contracts to handle drilling
operations for exploration and development
namely:
1. Discrete contract,
2. Semi-integrated project Managemen contract
(IPM),
3. IPM contract,
4. Bundled contract.
Every contract has advantage and disadvantages
(Isa et al, 2017; Kelley, 2017; Zuhro & Arif 2015)
explains as follows:
1. Discrete contract is generally used by
geothermal company that has complete
organisational, techical capability and
experienced personel to plan and execute
drilling operation and have continuous drilling
program. Normally this type of contract has 24-
30 contracts to be managed by companies.
2. Bundled services is a modification of discrete
contract and semi-IPM contract which simplify
contract to less than 13-20 contracts. This type
of contract enable geothermal company to only
communicate with contactor project manager
and enhance communication process.
3. Semi-IPM contract enables geothermal
companies to simplify contracting process. This
scheme is generally selected by geothermal
companies that have wide-ranging exploration
areas to keep costs as minimum as possible
while maintaining control of the drilling
quality. This type of scheme reduce contract up
to 8 contract.
4. Full IPM contract is generally used when
geothermal company has limited organisational
capability in preparing and execute drilling
 operation. This type of contract only use 1
contract but rely heavily on IPM contractor and
is hard to change out one service nevertheless is
suitable with exploration area that only assign
less drilling.
Drilling contracts types of the last eight years were
gathered from 22 active field and the result can be
seen in Figure 3.
Figure 3 Distribution of geothermal drilling
contract from 2010 to 2018
5. OPERATIONAL CHALLENGES
During drilling campaign, geothermal developers
normally encounter obstruction and challenges that
derived by both equipment problem and subsurface
technical problem. Finger and Blankenship (2010)
and Vollmar et al (2013) divide potential
subsurface problems in geothermal drilling as
follows:
1. High temperature
Problems which caused by temperature mostly
tools temperature limitation, extreme thermal
stress on the tubular. Corrosion rate increases
and degraded drilling fluid.
2. Lost circulation
Around 10% of total cost of geothermal project
is due to loss circulation combating. Loss
circulation may cause several effects such as:
a. Cost increase since drilling fluid is
expensive.
b. Hydrostatic head reduction that may lead to
wellbore influx.
c. Stuck pipe due to poor cutting removal.
3. Wellbore instability
This problem is usually cause by mechanically
unstable formation, swelling/ shrinking clays
and differential stress that may lead to drilling
obstruction.
4. Cementation and casing
Lost circulation during cementing often lead to
poor cementing which can cause trapping water
that can cause casing collapse.
Pertamina Geothermal Energy (PGE) had issues
with rig equipment where drilling operation had
to be postponed for three months because of
waiting for rig spare part. PGE initiated usage
of Tie Back System to replace dual-stage
cementing collar (DSCC) in order to avoid
production casing collapse Zuhro and Arif
(2015). Combating loss circulation and
unexpected well formation may also cause
drilling delay.
Problems encountered during drilling can cause
non-productive time (NPT), which can result in
cost overruns. NPT in geothermal drilling in
Indonesia that assessed from 22 drilling in 2016 is
presented in figure 4.
Figure 4 PT vs NPT in of drilling in 2016
Activities that lead to NPT of drilling activity in
2016 is largely dominated by loss combating,
cement plug, stuck pipe handling, side tracking and
fishing.
6. WELL DEPTH AND COSTS
Costs required for geothermal well generally
include drilling costs, well completion, well pad
construction costs, permitting and other supporting
costs. Well costs analyzed in this study are limited
to the costs required to complete the drilling of the
wells starting from the provision of drilling
material to completion of drilling.
Studies on drilling costs in Indonesia have been
largely undertaken by geothermal developers but
the results are rarely published. Previous research
was conducted by Lukawski (2012) to determine
the ratio of geothermal and oil and gas drilling
costs in the world. For geothermal field in
Indonesia, Sanyal (2014) have studied geothermal
drilling cost and correlation with well productivity.
Depth is main determinant of the drilling cost of a
geothermal well, which typically drilling cost in
any country increases exponentially with depth
(Sanyal 2014). Figure 5 shows histogram of depth
of 609 wells which indicating that geothermal wells
in Indonesia ranges from about 800-3500 mMD
with mean value of drilling depth of 1960 mMD.
We examine 121 geothermal wells from 213 wells
drilled in 2011 to 2018. Drilling costs were
normalized using the US Department of Labor
Bureau's Producer Price Index (PPI) to escalate the
well cost. Figure 6 describes the well cost-depth
data obtained from 121 well which we analyzed.
Figure 5: Histogram of geothermal well depth in
Indonesia Figure 7: frequency distribution of GDUC

Table 1: Comparison of GDUC in geothermal field

in Sumatera

Type of drilling Number of Average GDUC

contract well analyzed (US$/m)

Discrete 19 2,930
Bundled 18 3,027
Semi IPM 46 3,963
IPM 33 5,411

7. WELL OUTPUT AND SUCCESS RATIO

Sanyal (2014) divides well commerciality based on
Figure 6: geothermal well cost as a function of its capacity, which defines that commercial wells in
measured well depth Indonesia ranges from 3 MW to 40 MW. Well
capacity of less than 2 MW and sometimes 3 MW
Figure 6 explains that drilling costs in Indonesia is considered non commercial well and can be
are typically around US$ 4 million to US$ 9 functioned as injection well. This study uses the
million with an estimated drilling depth ranges same assumptions of commercial well have well
generally from 1,500-3,000 mMD. The diagram output larger than 2 MW, however in some cases
ignores the fact that drilling is using either standard well with output less than 2 MW can be connected
hole or big hole. Studies explain that large hole into production system. Figure 8 describes well
well costs 120% of normal standard hole, whereas output distribution in commercial well in
slim hole costs only 25-35% of standard hole. Indonesia.
Zuhro & Arif 2015 explains that one way to
measure drilling performance is geothermal drilling
unit cost/ GDUC (US$/m). Figure 7 describes
geothermal unit cost as a function of depth. The
result show that GDUC in geothermal area in
Indonesia varies from 1000 up to more than 5,000
US$/m, however statistical analysis suggests that
mean GDUC in Indonesia from 2011 to 2018 is
about 3,960 US$/m as a baseline.
Furthermore, we conducted analysis based on
drilling contracts of geothermal drilling in
Sumatera. The results of the analysis explain that
geothermal companies which using discrete and
bundling drilling contracts have the least unit cost
cost compared to those using contracts semi-IPM Figure 8: distribution of commercial well output in
and full-IPM which compared in table 1. Indonesia
We calculate drilling success ratio based on
commercial well divided by total well in every
geothermal field (not included reinjection well and
well which currently being tested and undergone
heating up process). The result, based on our
evaluation, shows drilling success ratio ranges from
33% to 87%.
MEMR. 2018. Doing Bussiness in Geothermal.
unpublished.
Layman, E.B., Agus, I.,Warsa, S. 2002. The Dieng
Geothermal Resource, Central Java, Indonesia.
Geothermal Resources Council Transaction, Vol.
26

Lukawski, M. Z., Anderson, B. J., Augustine, C.,

8. CONCLUSION Capuano Jr, L. E., Beckers, K. F., Livesay, B., &
Tester, J. W. (2014). Cost analysis of oil, gas, and
1. Number of well in Indonesia are up to 711
geothermal well drilling. Journal of Petroleum
wells.
Science and Engineering, 118, 1-14.
2. Geothermal area in Indonesia varies from
1000 up to more than 5,000 US$/m with
Quinlivan, P. (2017). Geothermal Project
GDUC in Indonesia from 2011 to 2018 is Management. unpublished.
about 3,960 US$/m as a baseline.
3. Based on our evaluation, shows drilling
Rahman, K., Subroto, W. (2017). Challenge in
success ratio ranges from 33% to 87%
Green Field Geothermal Exploration. (unpublished)
ACKNOWLEDGEMENT Sanyal, S. K., Morrow, J. W., Jayawardena, M. S.,
We would like to appreciate Directorate of Berrah, N., & Li, S. F. (2011). Geothermal
Geothermal who supports this publication. Resource Risk in Indonesia–A Statistical Inquiry.
In International Conference on Renewable Energy
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(2017). A non IPM Contract for Exploration
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Panas Bumi. (unpublished)
 Appendix A: Geothermal well and subsurface information

Success
shallow Maximum Maximum Reservoir Maximum total average
Total deep well unsuccessfull successfull ratio Maximum
well drilled drilled zone reservoir well well
GWA/ Field number (>1000 well (< 2 well (> 2 (successful well output
(<1000 depth depth depths temperature output output
of wells mMD) MWe) MWe) well/ total (MWe)
mMD) (mMD) (mTVD) (mTVD) (o C) (MWe) (MWe)
well)
Kamojang 92 14 78 43 49 53% 3009 2582 680-2000 245 11.0 271 5.5
Lahendong 51 0 51 31 20 39% 3003 2683 920-2500 358 22.0 152 7.6
Ulubelu 50 1 49 27 22 45% 2537 2394 1000-2275 282 16.0 225 10.2
Sibayak 10 0 10 3 7 70% 2302 2116 1575-2100 284 4.0 21.6 3.1
Karaha 32 18 14 6 8 57% 3076 N/A 1400-2000 296 8.7 40.5 5.1
Lumut Balai 27 0 27 4 23 85% 3003 2639 800-2850 251 13.9 127 5.5
Hululais &
Bukit Daun 18 1 17 3 6 67% 3280 N/A 1600-2900 300 14.0 69 11.5
Sungai Penuh/
Kerinci 5 0 5 1 1 50% 3300 2798 1800-2400 281 3.8 4 2.0
Kotamobagu 5 3 2 2 0 0% 2510 N/A - 160 0.0 0 0.0
Salak 110 5 105 11 72 87% 3200 3200 950-1700 327 36.4 512 7.1
Darajat 49 2 47 9 34 79% 2890 2474 650-1200 248 38.0 281 8.3
Wayang
Windu 55 1 54 12 32 73% 2496 2314 900-1600 270 39.0 231 7.2
Sarulla 48 0 48 14 14 50% 2590 N/A 1200-2000 311 55.0 471 33.6
Bedugul 9 6 3 1 2 67% 2979 2678 500-1200 326 4.0 7 3.5
Dieng 52 5 47 18 20 53% 3214 2980 1400-2300 369 22.0 269 13.5
Patuha 31 19 12 3 9 75% 2701 2273 670-850 239 9.5 57 6.3
Ulumbu 3 2 1 2 1 33% 1890 N/A 600-800 263 15.0 15 5.0
Mataloko 7 7 0 3 2 40% 756 756 >700 205 2.0 N/A N/A
Tulehu 5 0 5 4 1 20% 1900 1719 N/A 205 4.0 4 1.0
Cibuni 3 1 2 2 1 33% 1550 1550 700-1500 243 4.4 4 1.0
 Success
shallow Maximum Maximum Reservoir Maximum total average
Total deep well unsuccessfull successfull ratio Maximum
well drilled drilled zone reservoir well well
GWA/ Field number (>1000 well (< 2 well (> 2 (successful well output
(<1000 depth depth depths temperature output output
of wells mMD) MWe) MWe) well/ total (MWe)
mMD) (mMD) (mTVD) (mTVD) (o C) (MWe) (MWe)
well)
Muaralaboh 16 1 15 3 8 73% 3103 2860 1100-2500 310 31.5 151 18.6
Rantau Dedap 6 0 6 1 5 83% 2723 2180 1400-2110 288 20.1 39.4 7.9
Sorik Marapi 16 0 16 5 6 55% 2593 2382 800-1700 280 15.7 62 10.3
under
Sokoria 4 0 4 N/A N/A testing 2072 2062 N/A 255 0.0 0 0.0
Jaboi 2 0 2 1 1 50% 1300 1300 1100-1300 260 4.8 4.8 4.8
Baturaden 2 0 2 2 0 0% 3447 3447 N/A 238 0.0 0 0.0
Blawan Ijen 2 1 1 2 0 0% 2000 2000 >1970 291 0.0 0 0.0
Tangkuban
Perahu 1 1 0 1 0 0% 612 N/A N/A 0 0.0 0 0.0

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