Medco-Ormat-Itochu Consortium Signs Heads of Agreement for Sarulla Geothermal Project at the Japan-Indonesia Forum

 JAKARTA, Indonesia, Aug. 20 /PRNewswire-FirstCall/ -- The Medco-Ormat-
Itochu Consortium ("the Consortium"), which consists of Medco Energi
Internasional Tbk; Ormat International, Inc., a subsidiary of Ormat
Technologies, Inc. (NYSE: ORA); and the Itochu Corporation, today announced
the signing of a Heads of Agreement ("HoA") for the Sarulla Geothermal
Project. In addition to members of the Consortium, Mr. Eddie Widiono,
President Director of state-owned Indonesian power company PT Perusahaan
Listrik Negara ("PLN"), and Mr. Ari H. Soemarno, President & CEO of
Pertamina, also signed the agreement. The signing was witnessed by The
President of the Republic of Indonesia H.E. Mr. Susilo Bambang Yudhoyono
and the Prime Minister of Japan, H.E. Mr. Shinzo Abe during the
Japan-Indonesia Business Forum.
   (Logo: http://www.newscom.com/cgi-bin/prnh/20040422/LATH066LOGO )
   The Consortium received a Letter of Intent from PLN on July 25, 2006
following a tender process and, having reached preliminary agreements,
expects that it will soon formalize the Deed of Assignment ("DoA"), and
amendments of the Energy Sales Contract ("ESC") with PLN and Joint
Operating Contract ("JOC") with Pertamina.
   The HoA sets forth the milestones achieved in the contract negotiations
and the parties' undertaking to expedite the contracts finalization and
formalization, including all relevant approval procedures.
   The Sarulla Geothermal Project, located in Tapanuli Utara, North
Sumatra, represents the largest single-contract geothermal project to date
in the geothermal industry, and is a reflection of the large scale, high
productivity and potential of Indonesian geothermal resources.
   The Sarulla Geothermal project is to be constructed over the next five
years. It will consist of three phases of 110 to 120 MW each, with the
first power generating unit scheduled to commence operation within 30
months of the financial closing, and the remainder scheduled to commence
operation over a period of 18 months following the first unit. Power
delivered by the project will serve the base load of PLN's North Sumatra -
Aceh grid system.
   The project will be owned and operated by the Consortium members under
the framework of a JOC with the concession holder, PT Pertamina (Persero)
(the state-owned oil and gas company) through its subsidiary PT Pertamina
Geothermal Energy.
   Medco is the leader of the Consortium, whose bid included completion of
the development of the geothermal steam field, construction of the field
piping systems and three Ormat designed and supplied power plants with a
combined gross capacity of approximately 340 MW. The Consortium will own
and operate the facilities, as well as sell electricity to PLN under a
30-year Energy Sales Contract ("ESC"). The total project cost is projected
to be approximately US$800 million, and it is expected that the Japan Bank
for International Corporation ("JBIC") will provide the majority of the
project financing based on the Umbrella Note of Mutual Understanding signed
between the Ministry of Finance of Indonesia and JBIC.
   In addition to the HOA, The Consortium and Kyushu Electric Power Co.,
Inc. executed a Memorandum of Understanding (MOU) on the same day. The MOU
confirms Kyushu Electric's strong interest in participating in the Sarulla
Project. Kyushu Electric is one of the largest electricity utility
companies in Japan and owns and operates a number of geothermal power
plants in Kyushu.
   Mr. Hilmi Panigoro, CEO of PT Medco Energi Internasional Tbk, said,
"Geothermal is one of the primary energy resources for the future. This
project will be a cornerstone for the company's efforts to diversify its
energy resources portfolio."
   Mr. Aries Pardjimanto, President Director of PT Medco Geothermal
Indonesia, added, "The Sarulla project is evidence of our commitment to
developing Renewable Energy Resources, and our desire to assist the
Government in its effort to provide new power generation capacity in the
region."
   Also commenting on the project, Lucien Bronicki, Chairman and CTO of
Ormat Technologies, stated, "We are pleased that the long cooperation with
Pertamina, PLN and the teams of Medco and Itochu is approaching fruition.
Ormat's air-cooled geothermal Combined Cycle technology, well proven over
the last 15 years, is particularly suited to assure maximum utilization of
the Sarulla resource in a sustainable manner. We pledge to continue our
efforts to contribute to the development of this important renewable energy
of Indonesia by sharing our experience in constructing geothermal plants in
12 countries as well as the operating experience of the plants we own in
the US, Guatemala, Kenya, Nicaragua and the Philippines."
   Mr. Akira Yokota, Executive Vice President of ITOCHU Corporation, said
"ITOCHU has been actively pursuing environmental renewable energy projects
in several countries and geothermal power projects are also an area we have
been truly focusing. Indonesia has quite rich geothermal resources and we
are very glad to have achieved this valuable step in contributing to the
further prosperity of Indonesia through Sarulla Power Project using such
environmentally friendly resources which Indonesia owns."
   About Ormat Technologies
   Ormat Technologies, Inc. is a vertically-integrated company primarily
engaged in the geothermal and recovered energy power business. The Company
designs, develops, builds, owns and operates geothermal and recovered
energy power plants using Organic Rankine Cycle (ORC) technology.
Additionally, the Company designs, manufactures and sells geothermal and
recovered energy power units and other power generating equipment, and
provides related services. Ormat is a pioneer and a leader in the
manufacture of ORC power equipment its products and systems are covered by
approximately 70 patents. Ormat currently operates the following geothermal
power plants: in the United States - Brady, Heber, Mammoth, Ormesa, Puna
and Steamboat; in the Philippines - Leyte; in Guatemala - Zunil; in Kenya -
Olkaria; and in Nicaragua - Momotombo. In the U.S., Ormat owns and operates
four OREG1 Recovered Energy Generation plants.
   Safe Harbor Statement
   Information provided in this press release may contain statements
relating to current expectations, estimates, forecasts and projections
about future events that are "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements generally relate to Ormat's plans, objectives and expectations
for future operations and are based upon its management's current estimates
and projections of future results or trends. Actual future results may
differ materially from those projected as a result of certain risks and
uncertainties. For a discussion of such risks and uncertainties, see "Risk
Factors" as described in Ormat Technologies, Inc.'s Annual Report on Form
10-K filed with the Securities and Exchange Commission on March 12, 2007.
   These forward-looking statements are made only as of the date hereof,
and we undertake no obligation to update or revise the forward-looking
statements, whether as a result of new information, future events or
otherwise.
    Ormat Technologies Contact:        Investor Relations Contact:
    Dita Bronicki                      Todd Fromer/ Marybeth Csaby
    CEO and President                  KCSA Worldwide
    +1-775-356-9029                    +212-896-1215 / 212-896-1236
    dbronicki@ormat.com                tfromer@kcsa.com / mcsaby@kcsa.com

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