Featured GEA members: Alterra Power, AltaRock Energy, Mitsubishi, Ormat Technologies, and Ram Power

Geothermal Energy Association members are announcing major developments all around the world. This week’s news comes from places as diverse as South Korea, Peru, Japan, Guatemala, and Nicaragua.

Ormat Don A  Campbell Final Plant
Did you know three new geothermal power plants have come on line in the past month in the western United States, and they were all built by Geothermal Energy Association members? Photo courtesy of Ormat Technologies: the new 16-MW Don A. Campbell (Wild Rose) plant, built by Ormat, is located in Mineral County, Nevada. Read on for the latest news from GEA members.

AltaRock Energy: Investment Signed for 3.5-MW Deep Geothermal Plant in South Korea
Alterra Power: Further Peruvian Joint Venture Complete
Mitsubishi: Partnership with Turboden to Bring 5-MW Geo Power Plant to Japan
Ormat Technologies: PPA for Zunil Power Plant in Guatemala Extended by 15 Years
Ram Power: Remediation Drilling at Nicargua’s San Jacinto Successful

An article on The Motley Fool this week called “Are We Giving This Renewable Energy Source Enough Credit?” discusses geothermal energy potential, pointing out recent activities of GEA members Ormat Technologies and Calpine Corp.  Read on for headlines and updates from our member companies.

AltaRock Energy: Investment Signed for 3.5-MW Deep Geothermal Plant in South Korea
This week, AltaRock Energy Inc. signed an investment agreement for US$76.83 million to construct a 3.5-MW deep geothermal power plant. The plan includes using a water hammer drilling method which uses strong water pressure from an injection well to move the drill bit. David Blackwell, professor of geophysics at Southern Methodist University was quoted in press, “Using Hanjin’s water hammer method, it will be possible to build deep geothermal power generators with a capacity of 50,000 MW by 2050.” He said, “That is enough to replace fifty nuclear power plants around the world.”

Alterra Power: Further Peruvian Joint Venture Complete
Alterra Press Release (VANCOUVER) January 16 ~ Alterra Power Corp. (TSX: AXY) announces the completion of a further joint venture with Energy Development Corporation (EDC) covering the remainder of Alterra’s geothermal development assets in Peru. Under the agreement, EDC will get a 70% interest in the development asset portfolio and will be funding 100% of the next $6 million of development costs. Next activities for these concessions will include advanced exploration activities designed to identify the best locations for power plant development and construction.

Mitsubishi: Partnership with Turboden to Bring 5-MW Geo Power Plant to Japan
Turboden and Mitsubishi Heavy Industries Group (MHI) have partnered on a 5-MW geothermal plant in Japan and plan to expand their geothermal portfolio further with Turboden now part of the MHI group. The partnership can provide “all the possible solutions required by a geothermal developer and can provide the best optimized configuration for that specific resource,” according to a press release announcing the joint venture, and are “a fully-integrated supplier of binary and steam geothermal power-plants.

“Now that we are part of MHI, leader in geothermal systems for flash steam power plants, and we are strong in our German references” Paolo Bertuzzi, General Manager Financial & Commercial of Turboden told press, “we intend to invest further in geothermal energy and introduce ourselves to the market as a reference player. Turboden aims to satisfy the wide range of technical solutions required, from the low enthalpy liquid dominated resources up to the higher enthalpy fields.”

Ormat Technologies: PPA for Zunil Power Plant in Guatemala Extended by 15 Years
Ormat Press Release (RENO, Nev.) January 22 ~ Ormat Technologies, Inc. (NYSE: ORA) announced today its indirect, wholly owned subsidiary signed an amendment to the power purchase agreement (PPA) with Instituto Nacional de Electrificacion (INDE) for its Zunil geothermal power plant in Guatemala. The amendment extends the term of the PPA from 2019 to 2034.

The PPA amendment also transfers operation and management responsibilities of the Zunil geothermal field from INDE to Ormat for the term of the amended PPA in exchange for a tariff increase. Additionally, INDE exercised its right under the PPA to become a partner in the Zunil power plant with 3% equity interest.

Zunil geothermal power plant was built by Ormat and started operation in 1999. Currently the power plant generates approximately 50 % of its installed capacity due to lack of sufficient geothermal resource supply. Ormat plans to improve the heat supply to gradually increase generation, subject to monitoring and assessment of the geothermal reservoir. Ormat expects this improvement will increase the energy portion of revenues, which are paid based on actual generation.

Dita Bronicki, chief executive officer of Ormat said, “We are proud to have the opportunity to improve the performance of the Zunil power plant and extend the PPA term of the project for an additional 15 years. This supports our confidence in Guatemala’s economy and the potential of the Zunil geothermal field. The hard work and dedication of our plant’s operation team, consisting entirely of skilled local employees, combined with our experienced geothermal resource development team will ensure the sustainable operation of additional clean, base-load power to Guatemala’s grid.”

Ram Power: Remediation Drilling at Nicargua’s San Jacinto Successful
Ram Power Press Release, January 22 ~ Ram Power, Corp. is pleased to announce that the remediation program, which was initiated on July 18, 2013 at our San Jacinto-Tizate project (the “Project”), has ended as of January 14, 2013.

The remediation drilling program to increase the steam resource of the Project called for the refurbishment of four existing production wells as well as the replacement and perforation of specified well casings along with the deepening and forking of two wells. The plan is expected to increase steam availability of approximately 9 to 14 MW gross or 70-110 tonnes / hour of additional net capacity bringing total generation to approximately 59 to 63 MW (net). The remediation drilling operations were led by Sinclair Knight Merz, the resource consultant for the Company, and PENSA engineering personnel (the “Remediation Team”).

Update to Well SJ 9-3
As previously disclosed, during the heat-up period and discharge test of well SJ 9-3 in December of 2013, the Company conducted a sinker bar survey run and discovered an obstruction at approximately 1,100 meters in the main leg of the well. Following the conclusion of the remediation efforts in SJ 12-3, the Company mobilized the ThermaSource drilling rig back to well SJ 9-3 to clear the obstruction. The Company successfully drilled out the obstruction, and following the clearing, the Company conducted a sinker bar measurement which reached the final depth of 1,980 meters.

Well SJ 9-3 is now in thermal recovery and the Company remains encouraged with the initial results including, but not limited to, the drilling loss circulation during remediation, down hole temperature and the results of the injectivity test.

Update to Well SJ 12-3
As previously disclosed, following the conclusion of the remediation efforts in well SJ 12-3 in mid-December 2013, the Company was unable to retrieve the whipstock used to directionally drill the forked leg. Following several down hole camera runs, the Company as a result of the information obtained from the video images was able to successfully retrieve the whipstock out of well SJ 12-3.

Well SJ 12-3 is now in thermal recovery, results to date are encouraging and further details will be disclosed as available.

Remediation Testing Date
The Company and the Lenders are in negotiations to amend the remediation completion date in the Common Terms Agreement, with such revised date expected in late-January 2014. Following the completion of the resource remediation drilling program, the Company will conduct a plant capacity test expected to be concluded in March 2014. The test includes a 30-day stabilization period of the resource field followed by a 7-day performance test to determine the net operating output of the plant.

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