Reported from Australia, “Panax Geothermal (ASX: PAX) said the spudding of the Salamander-1 well at the Penola geothermal project in Australia was imminent after four months of delays as the contract rig has been fully assembled on the well site and is ready to drill, while also reporting that discussions with potential joint venture partners over the project were ongoing with several parties.

Spudding of the well was delayed for four months due to issues with the contract rig release date and cyclonic inland rains affecting rig transport.

The well is designed to convert part of the independently assessed measured geothermal resources into geothermal reserves, which is the basis for a development decision, expected to be completed within six months from the start of drilling. The well is set to reach a maximum depth of 4,000m, but may be pulled short following confirmation of the intersection of high porosity/permeability zones within the target reservoir.

The company has not been able to secure a JV partner for the project yet, though it said it had enough funds to continue with its projects in Australia and overseas after conducting a placement to raise A$8 million worth of funds to assist in advancing drilling of the well earlier in the quarter and securing a A$7 million grant from the Commonwealth government.

In Slovakia, results of the review of the historical information database of the Mezozoic carbonates within the East Slovakian Basin, where Panax can earn up to 75%, included flow rates of up to 120l/sec at a temperature of 130C at 2,252 metres. In India, the company expects to secure a development permit over the Puga geothermal project area, which Panax operates and where it holds a 49% interest.

At the end of the quarter, the company’s cash position stood at A$17.5 million, which is an increase of A$3.6 million over the previous quarter. Panax also has A$4.55 million remaining to be drawn on its geothermal drilling programme grant for the Panola geothermal project, expecting to draw the funds during the drilling of Salamander-1.”

Source: Proactive Investors