Jakarta.  The state energy company Pertamina and the American oil giant Chevron have agreed to collaborate to explore opportunities in low-carbon businesses in Indonesia in a move to help Indonesia reach its net-zero emission target in 2060.

Through its subsidiary, Chevron New Ventures, and Pertamina, Chevron would consider developing geothermal technology; carbon offsets through nature-based solutions; carbon capture, utilization, and storage (CCUS); and the development of production, storage, and transportation of low carbon hydrogen.

On Thursday, the companies had signed a Memorandum of Understanding (MoU) in Washington DC. It was witnessed by Jay Pryor, Chevron's executive vice president of business development, and Nicke Widyawati, Pertamina's president director.

Minister Coordinator for Maritime Affairs and Investment Luhut B. Pandjaitan and Minister of Investment/Head of Investment Coordinating Board of (BKPM) Bahlil Lahadalia also presented at the signing.

Luhut said a collaborative approach was vital for Indonesia to achieve its carbon goals. Among others, Indonesia seeks to source 23 percent of its energy from renewable energy by 2051 and reach net-zero emissions by 2060. 

“Without a doubt, efforts to boost lower carbon energy projects cannot be done alone. In the future, we hope that world-class oil and gas companies, such as Pertamina and Chevron, can partner to further reduce carbon emissions and advance energy transition as mandated by the Government of Indonesia," Luhut said. 

President of Chevron New Energies Jeff Gustavson said the company was excited to build upon its nearly 100-year history in Indonesia to help the country reach its energy transition and emissions targets.    

"This MoU demonstrates Chevron and Pertamina’s commitment to continue identifying lower carbon opportunities through collaboration and partnership between Chevron, national energy companies, and governments, all of which have a shared interest in advancing national energy transition,” Gustavson said. 

Indonesia emits about 575 million metric tons of carbon dioxide into the atmosphere in 2020, down 7.4 percent from a year earlier, according to BP Statistical Review 2021. The country has set a target to reach net-zero emissions by 2060. 

Chevron said in the statement that its partnership with Pertamina was part of the company's efforts to help the Indonesian government reach the net-zero target. 

"This partnership is a strategic step for Pertamina and Chevron to complement each other's strengths and develop low-carbon energy projects and solutions to encourage self-reliance and domestic energy security," Pertamina President Director Nicke Widyawati said.

Renewable energy accounted for 9.2 percent of Pertamina's energy mix in 2019, and it plans to increase the contribution to 17.7 percent in 2030.  

Geothermal played a significant part in Pertamina's Energy push. Through its Subholding Power & NRE, the state energy company has a total installed geothermal capacity of 1,877 megawatts from 13 geothermal work areas. 

Pertamina operates 672 megawatts independently, while the rest comes from 1,205 joint operation contracts.

Ulubelu hosts a green hydrogen pilot project, one of Pertamina's geothermal diversification developments in the country. Currently, it targets to produce target of 100 kilograms of green hydrogen per day.

Also, the company is developing brines to power project in Lahendong, which paves the way for similar projects in other areas with a total potential capacity of 200 megawatts. 

In addition, Nicke said Pertamina was working on Carbon Capture and Storage (CCS) and Carbon Capture, Utilization, and Storage (CCUS) systems in its two oil fields, Gundih and Sukowati. Pertamina planned to commercialize the CCUS in the Sumatra region, she said.