The three courses of the program will be held over a three year time period from 2013-1015 at the University of El Salvador.

“Each course will be taken by 30 geothermal experts. The operation will also finance 10 scholarships for Salvadoran participants and another 10 scholarships for participants from other countries. The project, which was approved by the IDB Board of Executive Directors, will provide the only theoretical and practical graduate-level training in geothermal energy available in Latin America and the Caribbean.

In 2010, Universidad de El Salvador, together with LaGeo and support from Italy, offered a specialized degree course on a pilot basis. The new program will include an evaluation of this pilot course.

A Sustainable Regional Training Plan in Geothermal Energy will be prepared to examine future demand for training as well as academic and financial aspects. The plan will define curriculum and teaching methods needed to ensure that participants receive the best training available in the region. Studies will also be conducted to determine the demand for masters or doctoral-level training in geothermal energy.

The region’s geothermal development potential is estimated at 6,000 MW. Of this, 43 percent is located in Central America, 39 percent in Mexico, 17 percent in the Andean region, and 1 percent in the Southern Cone. Two geothermal fields in El Salvador are currently being exploited, Ahuachapán and Berlíncon, with a combined installed capacity of 204 MW. This represents 14 percent of national installed capacity and 25 percent of net generation capacity, with production projected for an additional 25-30 years.
Of the program’s total cost of $2.9 million, approximately $1.4 million were provided by the Nordic Development Fund and $824,000 from the Fund for the Special Program on Sustainable Energy and Climate Change (SECCI-IDB). Counterpart financing for the program totals $770,000.”

Source: Power Engineering

The plan was announced in January 2011 and worked on with the support of the Japan International Cooperation Agency.

While Hydro and Concentrated solar power seem to be a key focus, geothermal is believed to be able to add up to 90 MW until 2026 under the plan. This would put the overall installed geothermal power generation capacity in the country to 204 MW.

Source: EvWind

Given stagnating power demand and the continued unclear regulatory framework in its home markets Italy and Spain, Enel Green Power aims at putting a corporate focus on emerging markets and to “raise its profile” in North America.

Enel Green Power is one of the largest geothermal power producers with large renewable energy operations across the world and geothermal energy operations in Italy, North America, Central and South America and Europe.

With its focus on emerging markets in Latin America, it will be interesting to see how fast the company pushes its projects in Chile among other Latin American countries.

As reported by Reuters the company plans to spend about EUR 6 billion ($7.9 billion) worldwide until 2016 to increase its overall power generation capacity by 4,300 MW from 7,100 MW (end of 2011) to 11,400 MW.

Source: Reuters

“The concession contains 24,710 acres (100 square kilometres) located in the center of the Aqua and Pacaya twin volcano complex. A key asset included in the concession is the El Ceibillo geothermal project which has nine existing geothermal wells with depths ranging from 560 to 2000 feet (170 to 610 meters) and a significant amount of geophysical and other technical data completed during the 1990s. The first of these wells encountered unexpectedly high temperatures and produced a mixture of steam and water. Six of the wells have measured reservoir temperatures in the range of 365 to 400 degrees F (185 to 204 degrees C). Fluid samples and rock cutting data from the wells suggest the existence of a deeper, higher-permeability reservoir at this site with temperatures ranging from 410 to 446 degrees F (210 to 230 degrees C). These wells have high conductive thermal gradients that indicate rapidly increasing temperatures with depth.

El Ceibillo is located in an industrial zone with major electrical transmission and distribution lines nearby. The Company has already completed preliminary reservoir, transmission and environmental studies for the project.”

Source: company release via Marketwatch

“The Latin America and the Caribbean region is committed to reducing its greenhouse gas footprint,” said Hans Schulz, head of the IDB’s Structured and Corporate Finance Department, which is responsible for financing large-scale projects in the private sector.

“Several countries are beginning to develop their potential for wind, geothermal, bio energy production and solar energy, often through private sector leadership,” Schulz said. “The IDB provides access to tailored long-term financing, not readily available in local capital markets for these types of projects.”

Last year, the IDB approved $736 million in financing for private sector environmentally-friendly projects, compared with the $663 million invested by the bank between 2000 and 2010.

The increase reflects both an increase in demand from the 26 governments the bank counts as its borrowing members and a strategic shift that calls for 25 percent of the bank’s lending portfolio to support climate change and environmentally-friendly initiatives, such as renewable energy.

As part of the meeting, the IDB and the Japan International Cooperation Agency signed a framework agreement that will provide up to $600 million in financing for renewable energy and energy efficiency projects in Central America and the Caribbean over the next five years.

At the meeting the IDB also agreed to join forces with the Asian Development Bank on strengthen trade and investments.

For the full article see link below.

Source: Environment News Service

The draft law ruled by the CNE (national commission of energy) consists “contracting of national waters exploitation to geothermal power generation in Platanares station” signed by SERNA (department of natural resources and environment). SERNA grants to the corresponding company, the exploitation of the geothermal resources for electricity production through binary cycle.

In Central America, Honduras has the second lowest potential energy from geothermal resources with an estimation of 125.3 MW and Platanares Geothermal plant will have an installed capacity of 35 MW. The chart shows the currently capacity installed by source.

Chart Source: ENEE (National Electric Power Company)

The annual production estimated of this project is 297.4 GWh, so if we take a closer look to the energy produced in 2011 we can see that Platanares will be equivalent to the same electricity generated by Biomass and Wind (290.9 GWh) providing the 4% of the total .

Chart Source: ENEE (National Electric Power Company)

Under the Decree 70-2007  the PPA terms are 20 year contract length – renewable energy projects under 50 MW- and the obligation to sign with ENEE (National Electric Power Company) as sole electricity buyer.

Sources;

La Prensa

Energías Renovables Honduras

Empresa Nacional de Energía Eléctrica

Written by A.Ormad

Geothermal resources are mostly found in volcanic systems near areas protected for conservation. So while development would be effecting the landscape, geothermal energy could replace power generation through hydrocarbons and thereby reduce greenhouse gas emissions, and make the country independent from the ups and downs of oil prices.

For development it would be necessary to remove a small pieces of land (e.g. between 5 to 10 square kilometers of the 140 square kilometers protected in the Rincon de la Vieja volcano). The land taken for development could be replaced by close by farm land purchased close by and added to the national park. Furthermore development would provide fees that in turn could fund the National Park system and improve the maintenance of the areas under the jurisdiction of the national parks.

Deputy Claudio Monge, president of the Environmental Commission, the chief executive of ICE, Teofilo de la Torre, Jorge Cabrera a specialist in environmental law and Mark Fernandez from the Chamber of Industries, don´t have any doubts about the urgency to exploit geothermal energy. The deputy also noted the willingness of their colleagues in Congress making a reference to the current obstacle “our tangled rules and the difficulties in the Costa Rican legislative process”.

The key is in the congress said the CEO exhibiting doubts about the best way to proceed. “What is the best way to proceed? explore first and then separate the portion of suitable land or displace an area to allow the exploration?” The lawyer offered solutions and to avoid disappointments, suggested adding geothermal to the list of activities tolerated in protected areas like research, ecotourism and installation of communication towers.

While we resolve the doubts about geothermal and await the action of the Legislature, Costa Rica is breaking marks in the burning of fuels to generate electricity and the oil bill grows.

Source: La Nación

Written by A.Ormad

“Climatescope” is an index that measures the investment climate and evaluates their ability to attract investment. At the same time, provides a guide for companies and manufacturers interested in developing its technology. For policy makers, aims to create a standard with the ability to measure actual achievement by establishing a set of goals applicable in the future.

The combination of a strong economic growth, exceptional natural resources and a general desire to increase its energy security makes Latin America and the Caribbean an area likely to generate significant growth in the renewable energy sector.

Within this index, Nicaragua ranks second behind Brazil. There have been several reasons but we could note that Nicaragua has the strongest microfinance market, within these 26 countries, with 10 organizations that offer some type of financial products related to the renewable world. The result is obvious in the chart below, from 2006 to 2010 the Nicaraguan market has attracted about U.S. $ 1.1 billion in clean energy investment, highlighting geothermal over other renewables.

Chart Source: Bloomberg New Energy Finance

Geothermal potential

According to the Nicaraguan Energy Institute (INE) the country has a geothermal potential of 1.200 MW divided into 9 areas;

1. Casita – San Cristóbal…224 MW
2. Telica – El Ñajo…………127 MW
3. San Jacinto – Tizate……161 MW
4. Hoyo – Monté Galán……148 MW
5. Momotombo……………..142 MW
6. Managua – Chiltepe…….107 MW
7. Tipitapa…………………..18 MW
8. Masaya – Mandaime……174 MW
9. Ometepe………………….100 MW               Total 1.200 MW

Other estimations like the Ministry of Energy and Mines include three more areas (Caldera de Apoyo, Mombacho Volcano and Consiguina Volcano) that in total, come to reach 1.500 MW.

Installed capacity and produced energy

Nicaragua has an installed capacity of 1.1 GW (1.100 MW) and at the end of 2011, geothermal energy meant the 8% of installed capacity. There are two companies operating in the geothermal market, Ormat Motombo Power Company and Polaris Energy Nicaragua SA (Ram Power’s Corporation subsidiary) adding a total installed capacity of 87.50 MW .

Chart Source: Bloomberg New Energy Finance

During 2010 geothermal has had an effective capacity of 36.80 MW (between 2001 and 2010 the effective capacity has never exceeded 40 MW). This is because the Momotombo geothermal plant in the 90′s produced over 70 MW but an overexploitation in the reservoir, brought down their production.

For this plant, in 1999, a PPA was signed between Enel and Ormat with an initial purchase generation price of U.S. $ 0.0458 kWh for 15 years, the lowest cost of all the Nicaraguan market.

At 19:00 on 9^th May 2011 the country produced a peak demand of 569.50 MW (the maximum of the year) so we can conclude that Nicaragua could cover their current electricity needs, exclusively with geothermal.

In 2010 was a gross generation of 3,659 GWh of which 1,353 GWh were generated by large hydro and renewables (wind, small hydro, geothermal, biomass and wastes) and 302 GWh belonged to geothermal. This means that 8% of the electricity consumed was provided by geothermal energy.

Chart Source: Bloomberg New Energy Finance

The country face several problems, on one hand, has one of the lowest electrification levels throughout Latin America and on the other hand, the cost of their energy bill undermines the competitiveness of their industry.

The rising prices of fossil fuels together with the dependence on their structure of generation (around 60% comes from diesel and fuel oil power stations) and the potential of geothermal resources makes the compelling need to promote a policy that grants for renewable energy (especially geothermal) a greater prominence role.

The development of favorable policies that have being carried out by the different actors involved makes Nicaragua a country called not only a country 100% renewable, if not in the future has the ability to export electricity to other countries.

Written by A.Ormad

“The mandate letter provides for IFC to lead and arrange a syndicate of lenders to finance up to $42 million for the construction of a binary unit which will add approximately 10 MW net of additional capacity to the existing 72 MW net expansion at the San Jacinto-Tizate Project site. IFC led a syndicate of seven international development banks for the financing of Phase II of the Project which is scheduled for completion in December 2012. The binary unit is planned to begin construction in late 2012, with an expected initial operation date in the first quarter 2014, at which point the binary unit is expected to contribute approximately $8 to $10 million of annual revenue to the Company, pending final negotiations of the power sales agreement. No additional production or injection wells are required to construct and operate the binary unit at its full capacity.

In the binary process, the geothermal fluid heats another liquid, such as isobutane or other refrigerant (the “working fluid”), that vaporizes at a lower temperature than water. The two fluids are kept completely separate through the use of heat exchangers to transfer heat energy from the geothermal fluid to the working fluid. When heated, the working fluid vaporizes into a “gas,” which is then used to turn the turbine-generator.

“We are very pleased with the successful outcome of negotiations with IFC for the binary unit Mandate Letter,” stated Shuman Moore, CEO of Ram Power. “The continued support of the project from IFC and our other project lenders signifies that the challenges of the past are behind us, and that the Company will continue to execute its strategic plan to complete development of this very important project for Nicaragua and the Company.”

Source: Company release via Marketwatch

The ICE is considering the installation of a new geothermal plant in the foothills of the Rincon de la Vieja volcano. It´s not the first geothermal plant in that area. The plant Pailas I opened in in the middle of 2011.

ICE currently has an installed capacity of 200 MW, of which the Miravalles plant has 165 MW and 35 MW are from Pailas I. Costa Rica has an estimated geothermal potential of 865 MW, of which only 23% is currently being used.

We provide the ICE information in order to explain the technology used; “It´s the first time in this country that this technology has been used: the directional drilling, to make diagonal excavations from one location to extract various fields. The geothermal plant, Pailas, will be largest geothermal plant in Costa Rica. The cooling tower has eight cells and the plant uses Ormat Binary Technology”

Written by A. Ormad

Source: La nación

Source: Costa Rican Electricity Institute (ICE)

Today I am asking you for your help in a short Reader Survey. It would be great if you could assist in filling out the survey.  Click here to take survey

I sincerely hope that you find the site and its features useful. From the beginning I have been using a variety of social media tools to help promote geothermal energy. Twitter has become an increasingly important tool. Facebook is something a bit underutilized. Google+ is coming. The ThinkGeoEnergy LinkedIn group with now also around 600 members is providing a great platform for discussions. The Ning community has not been that overly successful, but is still being used.

The free-to-use pictures I share via ThinkGeoEnergy’s Flickr account are also popular. If you want to share good geothermal pictures you can do this via the Flickr Group of ThinkGeoEnergy.

Then there are the other elements. In 2010, a weekly newsletter was added that today has over 600 subscribers and now even has a fine co-sponsor in Scientific Drilling. The Geothermal Job Portal was added last year and slowly gains some traction.

Also at the end of 2011, ThinkGeoEnergy was able to offer one of the first Geothermal apps for the iPhone – the GeoEnergy app, available in the App Store.

I am also very excited about the ThinkGeoEnergy Geothermal Power Plant Map, which is in full work. It is under development, so don´t expect it to be anywhere close to ready and correct, but for a preview see here: http://map.thinkgeoenergy.com/map.php, for the old map (on Google Maps) you can use this link.

I am now going through a bit of a strategic review of the site, for which the survey is supposed to be a little guidance of what you want to see for ThinkGeoEnergy going forward, so your help is appreciated.

There are some exciting news coming along for the industry, so the start into this year looks a lot better than indications of the end of last year. So lets hope we will see an exciting year.

I am also exploring the idea of a Marketing Workshop/ event in connection with the GRC Annual Meeting and the GEA Trade Show in Reno this fall, so stay tuned.

In this context I also would very much like to thank all the companies that have supported me through the years with advertisements and other contributions. Namely this is Islandsbanki, ISOR, GeothermEx, Hannon Armstrong, Verkís, Mannvit, Technip, Scientific Drilling, Iceland Drilling, Enerchange and Activated Logic.

There are a large number of other individuals and companies that have helped tremendously through advise, thoughts, critical remarks and comments and general support.

“Under the steam turbine supply contract with Fuji Electric Corp. of America (“Fuji”) for the Project’s Phase I, 36 MW steam turbine generator, Fuji was required to conduct a performance test shortly after commercial operation of the geothermal power plant to determine if the steam turbine generator meets all its guaranteed performance requirements under the contract. The test was conducted in accordance with the standard test code for steam turbines as established by the American Society of Mechanical Engineers (ASME) in order to verify that the turbine meets all its guaranteed performance requirements. The performance test was conducted on January 17, 2012 and the results confirmed that the Phase I steam turbine generator meets all guaranteed performance requirements under the contract.

Updating on the progress of construction of the San Jacinto Phase II 36 MW expansion, the company reports the continuation of construction with phase II construction being approximately 60% completed with final completion expected in December 2012. Power plant critical component engineering is 100% complete and balance of plant engineering is 92% complete as of the end of December 2011.”

On the San Jacinto Phase II Credit Facility Disbursement, the company reports it has “received the second disbursement of $14 million under its $160 million Phase II credit facility on January 30, 2012 which will be used for Phase II construction costs. To date, the Company has drawn $118 million under this credit facility.

“With the successful commercial operation of our Phase I San Jacinto project, the successful performance test of the Fuji 36 MW steam turbine generator, and with the Phase II construction on schedule for completion by the end of this year, we are very pleased with the continued strong progress at our San Jacinto project,” stated Shuman Moore, CEO of Ram Power.

Source: Company release via Marketwatch

Colombia’s mining and energy minister, Mauricio Cardenas, and Ecuador’s electricity and renewable energy minister, Esteban Albornoz Vintimilla, said they would contribute equally to the $4 million study with the aim of jointly developing a gethermal power facility generating up to 150 MW.

The ministers said in a joint statement after meeting in the Colombian capital Bogota that the three volcanoes to be studied are Chiles, Tufino and Cerro Negro, located in the western Andes of the two nations’ common border. The study will be complete by the end of 2013, they said.”

Source: Platts

The findings are interesting not only for the geothermal industry that sees its high capacity factors as one of the key selling arguments. While the research shows that geothermal energy is still a very favorable base-load capacity energy source for utilities world-wide, capacity factors are often not as high as they theoretically could be.

Building on the vast resources collected over the year, the research done by Bloomberg New Energy Finance for this study is quite thorough and looked at 71 geothermal fields globally.

For a global average, BNEF quotes a capacity factor of 73% and correctly notes that developers use much higher capacity factors for their project finance models. Higher resource temperatures statistically increase capacity factors at a rate of around 1% per 10 degrees Celsius. The performance of the different fields varies widely, with Iceland, Mexico and Indonesia representing the highest capacity factors. The age of the plants in Japan and the Philippines is mentioned as a reason for the lower capacity factors in both countries, through decreasing productivity of geothermal fields over time.

In detail the report goes into general trends of plant performance, performance by technology, country and developers.

In an interview with Mark Taylor the Head of Geothermal at Bloomberg New Energy Finance, he said, that “the findings might not be ideal for the industry, but geothermal energy is still base-load given its 90% availability. Also utilities in the U.S. still favor Geothermal and consider it a viable base-load option. This means that developers can still secure healthy power purchase agreements (PPA) and capital should be available for good projects.”

For financial institutions, capacity factors are important and information like that provided by Bloomberg New Energy Finance is crucial for the questions investors need to ask and developers need to be prepared to answer. “Lower than expected capacity factors could though mean difficulties with regards to not meeting PPA contract requirements, as well as meeting debt and interest payments through a decrease in revenues,” Mark Taylor added.

Geothermal development always has a risk element when it comes to resource assessment, drilling and planning, but the report by Bloomberg shows that it is crucial to be conservative in estimates as they determine the underlying contractual terms of the PPA, but also the availability of financing.

Again – and I mentioned this in various presentations these past 12 months – it is the question about the necessity about being conservative and successful, rather than overpromise and not live up to estimates given. The geothermal reporting codes by Australia and Canada are providing a codified approach to reporting of resource assessments that could help create investor confidence in projects, but also be one helpful element in securing PPAs that live up to expectations on both sides.

The development of these new geothermal areas are part of a long-term strategy to achieve as much as 40% of domestic power demand from geothermal sources by 2021. The exploration of new areas takes time, however, so even though these activities will start in 2012, it will take several years for the new wells to reach full scale power generation capability. LaGeo is the only company in the country’s mixed economy that has permission to export power generated from geothermal sources to the national power grid. LaGeo was created in 2001, as a public-private ownership venture for Investments Energy, a subsidiary of the Executive Hydroelectric Commission of Lempa River, and Enel Geothermal, subsidiary of Italian utility and developer Enel. The companies have been in a legal dispute, which has been resolved in mid-2011, with Enel remaining an investor in the Salvadoran geothermal market.”

Source: La Prensa Grafica (in Spanish) via Renewbl

“The completion of the Phase I expansion and turning the unit over to the Nicaraguan national integrated electrical grid operator for commercial operation marks the completion of a major milestone in the continued development of our San Jacinto-Tizate project,” said Shuman Moore, Chief Executive Officer of Ram Power. “This could not have been accomplished without the exceptional efforts and dedication of Ram Power’s employees at the project site, in our Managua office, our corporate office staff in Reno, our board of directors and our Phase I project lenders.”

Antony Mitchell, Executive Chairman of Ram Power, stated, “We would like to thank our Phase I lending consortium including the Central American Bank for Economic Integration (“CABEI”), Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (“FMO”) and their affiliates for their continued support of this important project. We would also especially like to thank the Nicaraguan government and the Ministry of Energy and Mines, without whose support this expansion would not have been possible.”

Source: Ram Power

ThinkGeoEnergy would like to thank its advertisement partners that have helped to keep the site running. So my sincere thanks to Íslandsbanki, Iceland GeoSurvey (ISOR), GeothermEx, Hannon Armstrong, Verkís, Mannvit, Technip, Iceland Drilling and the many other firms who have helped in one or another way.

This year was quite an active one for ThinkGeoEnergy. Finally late this summer, the Geothermal Job Portal was launched with now several jobs posted. Clearly it will need to grow and it will.

Earlier this month GeoEnergy, the iPhone news app for ThinkGeoEnergy was published on the App Store and allows a condense news overview for those of you using an iPhone. It will be tried to offer an Android app as well, but this might take a while.

In October, ThinkGeoEnergy – together with ISOR – published the Geothermal Power Map, a printed world map with the locations of the geothermal fields of this world. The online version is still a work-in-progress, but will be worked to a useable format in 2012.

To many of you, I would like to extend my gratitude for your ongoing dedication to geothermal energy and development in general. Many of you became good friends and I cherish our friendship and ongoing cooperation. Keep up the fight for development in Asia, the Pacific region, Australia, U.S., Canada, Chile, Argentina, Turkey and so on.

I wish you all a peaceful and regenerating holiday season. I am looking forward seeing many of you at the several geothermal events in 2012.

With all the best wishes for 2012,

Alex(ander) Richter

The signing took place between the Minister of Foreign Affairs of Nicaragua, Samuel Santos and his counterpart Kim Sung Hwan, as part of the celebration IV High Level Forum on Aid Effectiveness, held in Korea in the which involved nearly 3,000 delegates from around the world.

The loan term is 40 years, with 10 year grace period and 0.1% interest.”

Source: El Nuevo Diario (in Spanish)

To achieve this goal, JICA and ICEA will exchange technical and environmental information on the exploration of geothermal resources.

Feasibility studies for geothermal projects Pailas II and Borinquen are to be started soon. They will be financed by the Japanese government, under under the agreement of ICE and JICA.

“When the feasibility documentation is ready both entities will discuss the possibility of a state-backed loan from the Japanese JICA directly to ICE.”

The Pailas Geothermal Project is located on the slopes of Rincon de la Vieja Volcano in Guanacaste province. Its planned capacity is 35MW, providing electricity to 95,000 homes.

Source: el financiero cr

GeoEnergy – the ThinkGeoEnergy Geothermal News App

Long time in the making it now available on the App Store. “GeoEnergy” is a news application of ThinkGeoEnergy.com. It provides the complete news overview, access to the Twitter feed of ThinkGeoEnergy, the latest contributions posted on Flickr and YouTube, as well as regional feeds of geothermal news around the global.

As far as I am aware it is the first real Geothermal Energy focused App for the iPhone.

The app is available for free on the App Store. It has cost me though considerable nerves, effort and time to put it up, so if you feel rather generous any donations are welcome. To donate Click here

I might also spend some time creating an app for Android, but this might take a while.

“El Ciebillo lies in the company’s 100km2 concession in the Aqua and Pacaya volcano complex.

“[It is a] very high temperature, steam type resource that we’d like to get started on in the near future,” president and COO Doug Glaspey said in a presentation. Development envisions an initial 25MW.

Nine wells were drilled in the 1990s to depths ranging 170-610m, six of which have measured reservoir temperatures in the range of 365-440 degrees Fahrenheit (174-227 degrees Celsius). Follow-up work will include a detailed geophysical program, geologic mapping, sampling of hot springs, and the redrill of one or two existing wells.

The company also reported talks are underway with interested parties for the potential sale of a minority equity interest in El Ciebillo.”

Currently Guatemala has a geothermal power generation capacity of 49.2 MW.

Source: BN Americas

The map is currently only available in a limited number of copies, but might be available for sale in the near future.

It talks about the growing investment in renewable energy projects in the region with a particular take on geothermal energy.

One “country with great potential is Peru. There geothermal projects have contributed to the development of the country, according to press reports. The growth in the sector is linked to Peru being the leading exporter in South America with levels only comparable with those of Italy and New Zealand, according to a report on the geothermal prospects of the country 2010-2011.

However, some still think geothermal energy is in its infancy in the country since the costs of exploration amount to about $4 million which makes the operation expensive.
In Chile, there are already 21 new geothermal projects. This Latin America nation is filled with suitable volcanic areas for the generation of geothermal energy. The government is conscious of such wealth and has initiated a process of public auction through which it will grant to 21 new areas of operation in the regions of Tarapaca and the Rivers, according to a news report in La Nacion.

Sources at the Chilean Ministry of Energy calculate the project will generate $100 million in investments of exploration and development. The government hopes that by 2011 it will be able to auction other 50 geothermal concessions and another 120 in the period 2012-13.

New Zealand company Hot Rock is one of the most active firms in the search of the geothermal potential of Chile. The company calculates that the country can generate 5000 MW through geothermal means.

Another key nation in the geothermal energy development is Bolivia. A key region in the southwest of the country bordering Chile could have the potential to generate 6500 MW in geothermal power, a similar amount to Ecuador’s potential.

In Central America, geothermal energy has gradually gained prominence and it is now the second source of renewable energy in the region. It is expected that the region will produce 5000 MW in geothermal energy distributed among Guatemala, El Salvador, Nicaragua and Costa Rica. It is not yet clear what is Honduras and Panama’s potential.

Such is the importance of geothermal energy in Central American that Inversiones Energeticas, a firm with a stake in geothermal plant LaGeo in El Salvador, will appeal against an international court of law ruling in favour of Italian investors taking over the plant in an effort to extend the legal battle close to a year, according to El Faro newspaper.

Enel Green Power has said it was injecting capital in exchange for the acquisition of the 95 MW plant. But the Comisión Ejecutiva Hidroeléctrica del Río Lempa through Inversiones Energéticas appealed against the takeover to the Arbitration Court in France. However, the court subsequently ruled in favourable to Enel Green Power, and it is this decision that Inversiones Energéticas is now appealing against.

In Costa Rica, the country’s electricity institute, ICE, is in advanced talks to put together a geothermal pilot Project with a capacity of 12 MW with American company GTherm.

The company’s single-well engineered geothermal system does not require water depositories. Besides, the infrastructure is mostly buried, which it does not produce any hydraulic or visual contamination while generating clean and sustainable energy.”

Source: Power Engineering International

Plant commissioning activities for the Phase I expansion have commenced and the unit is expected to be in commercial operation in December 2011. The commissioning process includes the coordinated turnover of all plant subsystems systems between the Phase I expansion contractor Dymel and the commissioning staff, including Fuji Electric Corp. of America, the manufacturer of the turbine and generator. The Phase I expansion will add 36 MW of capacity to the existing 10 MW backpressure units currently in operation at San Jacinto. Once the Phase II 36 MW expansion is completed (which is expected to occur in December 2012), the 10 MW backpressure units will be decommissioned leaving 72 MW (net) operating capacity at San Jacinto.

“The mechanical completion of the Phase I expansion at San Jacinto-Tizate is a major milestone for Ram Power and our subsidiary, Polaris Energy Nicaragua, S.A.,” stated Shuman Moore, CEO of Ram Power. “The San Jacinto project has had significant challenges in its development, but through the hard work and determination of our employees in Nicaragua and the United States, we are now closer to our goal of producing clean geothermal power for the people of Nicaragua and value to our shareholders.”

Source: Company release via email

The Atitlan concession, located 144 km north-west of Guatemala City, covers 483 sq.km with three volcanoes. The Atitlan Volcano is a large, conical, active stratovolcano adjacent to the caldera of Lake Atitlan in the Highlands of Guatemala. The volcano has been quite active historically, with more than a dozen eruptions recorded between 1469 and 1853, the date of its most recent eruption. Atitlan is part of the Central American Volcanic Arc. The arc is a chain of volcanoes stretching along Central America formed by subduction of the Cocos Plate underneath the Caribbean Plate. These volcanoes are part of the Ring of Fire around the Pacific Ocean. The analysis of geothermal water samples from hot springs within the concession indicates the existence of a reservoir at a temperature of 186 degrees C.

The Joaquina concession covering 9 sq.km is located about 35 km. northeast of Guatemala City. It is a fault controlled geothermal source and has had several shallow holes drilled in it; all of which are making steam and/or hot water. There are numerous fumaroles and hot springs in the area and surface manifestations of the geothermal source extend for at least one square kilometre. The analysis of geothermal water samples indicates a reservoir temperature in the 180 degrees C or higher range.

“Our research on the geothermal prospects of Central America has resulted in the acquisition of two very encouraging projects,” said John Paterson, Centram’s President and CEO. “We now intend to aggressively explore and evaluate the development potential of these prospects,” he added.

Centram Geothermal is an explorer and developer of geothermal resources in Central America. The Company’s objective is to create shareholder value through the acquisition, exploration and subsequent development of early stage geothermal projects.”

Source: Company announcement via Marketwire

During a presentation to members of the Guatemalan Chamber of Commerce and Industry, AGER asked the sector authorities to promote a competition aimed at developing geothermal projects.

The country has the geothermal potential of more than 1,000 MW. The Vice President of AGER, Rudolf Jacobs, said that in principle a bid for the supply of up to 800 MW could supply Empresa Electrica de Guatemala, SA (EEGSA) and distributors Deocosa (west) and Deorsa (east).

The president of the National Energy commission says that this is currently not possible, but works to promote geothermal are in progress and quotes the risks and costs involved in such investments.

Source: Prensalibre

Mr Lewis said a target to restrict global warming to those two degrees is “probably unrealistic now, because of the politics; not because the technology isn’t there, not because with the right policies it’s just not possible – it’s just that there isn’t the political will”.

Without the United States signing up, there’s unlikely to be a global deal on emissions reduction negotiated at the next climate summit in Durban, South Africa. Without such a pact, there will be no successor to the Kyoto Protocol, which expires in 2012.

“Frankly the UN process has become, not totally irrelevant, but it’s not the forum where a meaningful global deal is going to be brokered that will get you on a two degrees centigrade trajectory,” Paris-based Mr Lewis said on a recent visit to Australia.

“That is not the political framework through which this (trajectory) is going to be delivered. I can’t tell you there is a ready-made alternative framework in place that will allow a global deal to be delivered because I don’t believe that either.”

So while putting a price on carbon emissions is a key incentive for renewable development, including geothermal, with no global deal it will be difficult. The article then also goes into the cutting emissions, and argues that countries – given the economic difficulties – will not deliver the emission reductions promised.

But progress will happen and come through “bottom-up” deals in “juristidcations “including Australia, California (which will have an emissions trading scheme from January 2013), South Korea, Japan (once it had recovered from this year’s natural disasters), China and Brazil take effect, Deutsche’s Mr Lewis said.”

Another point raised would be eventually rising oil, gas and coal prices. Something that at the moment looks like it won´t happen for some time. But with technological development in the renewable technologies, cost curves for the industry will go down and then maybe in some time, clean technologies “become viable on a stand-alone basiis, even without a carbon price.”

What does this mean for geothermal? Well, first of all geothermal is attractive as a base-load capacity renewable. Secondly it is – depending on geographical location – very cost competitive. So while there is a strong start up risk for geothermal development, it is already from a price perspective very attractive. It just needs to get over those first early hurdles. Carbon pricing clearly would help in getting the right partners to join. Good example is Australia, where utilities and power off-takers have taken stakes in geothermal development.

Source:: The Age (Australia)

The company said it has met all conditions precedent to borrow under this credit facility and submitted an initial draw request for $104m with about $35m of such amount being distributed to it as a reimbursement of a portion of its equity investment.

The remainder is being used for future project costs for the next four months and required contingency reserves.

Ram Power has now met the required injection capacity for both Phase I and Phase II of the geothermal project.

The company said that combining the recently completed injection well SJ 11-1 with the conversion of well SJ 12-1 to an injection well, allows it to satisfy the injection requirement of the San Jacinto project.

Phase I construction is now 85% complete and mechanical completion of this phase is expected to occur in October 2011.

Ram Power has also amended the $77m credit facility for the 36MW Phase I San Jacinto-Tizate project expansion.”

Source: Company release via EBR

Several country leaders attended the event including the president of Costa Rica, H.E. Laura Chinchilla Miranda. Also on hand was the former Minister of Energy, Teofilo de la Torre who was recently nominated as the Executive President of ICE, the country’s national power utility. Dr. Nick Rischbieth, president of BCIE, along with other members of the government and distinguished dignitaries rounded out the attendees.

“We are very pleased to continue our collaboration with ICE which started with the 18 MW Miravalles Unit 5 in 2004. The Las Pailas plant demonstrates the trust that ICE and BCIE have in Ormat and its Binary Technology,” said Ormat’s Chairman, Lucien Y. Bronicki.”

Source: Domestic Fuel

“The steam rising from the Pacaya volcano and the hills and rivers surrounding it on the outskirts of Guatemala’s captial city hints at a power source that could give the country the energy security it craves.

Geothermal steam and water some 2,000 meters below the surface of the green hills and mountains is being tapped by the global alternative energy company Ormat, converted into electricity, and fed into the city’s main power grid.

There are currently only two geothermal power plants in Guatemala, both owned by Ormat, but the government says there are many more opportunities under the country’s soil.

It hopes to use this power source to meet up to two-thirds of the country’s annual energy demands by 2022. Guatemala wants to wean itself off the $2 billion it spends on oil imports every year.

Accordingly, the Guatemala government is offering tax breaks on equipment brought in to build geothermal plants. It says Ormat is only tapping 20 megawatts of a potential 1000-megawatt potential lying in wait around the county. Traditional electricity plants or hydropower facilities today generate most of Guatemala’s energy.

Some consider geothermal to be one of the cleanest forms of alternative energy out there.

Yossi Shilon, Ormat’s representative in Guatemala, says; “When you use this kind of technology, as you can see, there’s no smell being dissipated, the noise is very much controlled because after those walls you won’t hear any noise outside. Whatever we take out from the production well is also re-injected into the same reservoir, so we maintain the reservoir at its very basic parameters and it is not affected by our operation.”

But there are some barriers to entry for other companies hoping to join Guatemala’s geothermal race. The development of the geothermal fields is costly and risky – the plants themselves are also expensive to build and drilling doesn’t always turn up what’s expected.

Despite those risks, Ormat plans to expand its operations in Guatemala.

And as for the government, it’s a double-bonus: tapping more geothermal power will help wean it off of foreign oil, and help it to go green at the same time.”

Source: GlobalPost

He refers to the gas prices being low, effectively making electricity cheaper and therefore creating a difficult environment for geothermal companies in the U.S. Another picture can be found in the developing world, where lots of countries still generate most of its electricity from oil. With prices for oil reaching higher levels again, clearly this is a concern for those countries and they are looking increasingly at energy resources in their own countries, among them geothermal.

This reminds me of another discussion I had several weeks back, when I discussed with some colleagues the current situation of geothermal development. We then agreed that things look a lot better in the developing world. While this might not be the case for all countries, but clearly some of the best geothermal resources can be found in countries like Kenya, Indonesia, Philippines etc.  We also discussed that investors actually seem to get to the point where they don´t mind a certain political risk, if the resources are that much better than in politically more stable economies, such as the U.S. Furthermore financing seems to be more easily obtainable through development banks, which are not in a position to help finance projects in the developed world.

The article also refers to the discussion about consolidation and while this sounds interesting and true to some degree. The other truth is that the consolidation of smaller players, e.g. within Ram Power, meant a stop to their projects. A lot of the projects in development by Sierra Geothermal and Western GeoPower at the time when they were swallowed are now sitting idle, as these companies neither have the man power to do all the projects on the table and secondly the financing is not as available as hoped for to drive all those projects at once. On the other hand there are lots of smaller service companies and technology providers that could be interesting targets or even drivers of consolidation in the industry.

Interesting though is the recent announcement by Philippines  based EDC, that said its development cycle in Asia means that within 4-5 years they will have managed to bring some of their projects online, and are therefore looking at countries/ projects that could keep their momentum.

All in all very interesting thoughts. While I also believe in consolidation being a great opportunity, the financial markets and investors doen´t seem to play along to that tune … at least just yet.

Source: Tom Konrad via Seeking Alpha

“Colombia will promote investment in non-conventional renewable energy sources and lay the groundwork for its first geothermal project with a $2.7 million grant from the Global Environment Facility (GEF) administered by the Inter-American Development Bank (IDB).

Colombia, which currently obtains up to 70 percent of its electricity from hydraulic sources, has yet to tap its potentially vast geothermal resources, which would allow it to harness the virtually unlimited heat from the Earth’s core. Geothermal power generation produces less waste and pollution than conventional resources such as coal or oil but with high upfront development costs.

The IDB, which has nearly three decades of experience with geothermal projects, is encouraging countries in Latin America and the Caribbean to develop alternative low-carbon energy sources to mitigate greenhouse gas emissions.

This new IDB-backed project, which was approved by the Bank’s Board of Executive Directors on Tuesday July 5, will assist the Colombian government in developing a regulatory framework to foster the use of non-conventional renewable energy by establishing adequate incentives and removing barriers to investments in geothermal power projects.

This part of the project, which will be executed by Colombia’s Ministry of Mines and Energy’s Planning Unit, will also update the country’s database of information on available non-conventional renewable energy resources.

A second component, to be carried out by ISAGEN, a Colombian public-private utility company, will focus on the technical, environmental and social studies required to assess and validate the geothermal potential in the sites of the Macizo Volcanico del Ruiz, a volcanic massif in Colombia’s central mountain range.

The studies conducted under this component will complement the pre-feasibility studies already underway with support from a $900,000 grant from the IDB-administered Japan Trust Fund for Consultancy Services.

Depending on the results of the studies and the subsequent exploratory drilling phase, ISAGEN may build a 50-megawatt geothermal plant on one of the sites. GEF resources will also be used to analyze a suitable financial structure for the construction of the power plant, which is expected to have a demonstrative effect of Colombia’s potential to develop alternative energy resources.

Another key goal of the project is to disseminate information and knowledge about non-conventional renewable energy in Colombia. Staff from INGEOMINAS, Colombia’s geology and mining institute, and students from the National University of Colombia are participating in the technical assessment of the potential geothermal sites.

As counterpart contributions to the GEF grant for the project, ISAGEN is contributing $850,000 while the Ministry of Mines and Energy is contributing $200,000.

The IDB acts as an executing agency of the Global Environment Facility, an independent financial organization backed by 182 member countries. The GEF provides grants for projects related to biodiversity, climate change, land degradation, organic pollution, the ozone layer and international waters.

The IDB’s Energy Division is currently carrying out GEF-funded projects in nine countries in Latin America and the Caribbean involving solar, wind and hydro power, biogas, methane recovery and energy efficiency.”

Source: IADB.org

In an article in the national newspaper, the development cost were US$221.8 million and is now in the final stages of construction. It is expected that the plant will generate enough power to supply 92,000 families.

The project was developed as part of a lease-purchase with funds from the Central American Bank for Economic Integration (BCIE) and will be operated by the Instituto Costaricense de Electricidad (ICE), but is owned by BCIE.

Five geothermal wells will fuel a 35 MW generating unit. It was planned to go online in late 2010.

Costa Rica is not a new player in the geothermal world, having begun exploration of its geothermal resources in 1963, with its first plant going online in 1994. The current installation is 163.5 MW in the Miravallas geothermal field.

Source: America Economica (in Spanish)

The map will be an ever ongoing project, and I am also planning a mashup that will show a more professional layer map with more sophisticated data and a form to correct/ add plant locations.

So far the map has seen about 40,000 visitors, which is fantastic but also shows that I need to continue driving it forward. So stay tuned. Also if you feel some plants are missing, please don´t hesitate sending me coordinates and details.

A great thanks to Sandro Bruni of Enel Green Power.

The Map is freely accessible via Google Maps

The report talks about that “geothermal energy today is mainly known for its reliable production of base-load power – the power needed to meet minimum demands – in areas where geological conditions permit fluids to transfer heat from the Earth to the surface in self-flowing wells at high temperatures. However, geothermal resources at moderate temperatures can be found in aquifers that are widespread. Such resources can be used in binary power plants, combined heat and power plants or in heat-only applications. Emerging geothermal technologies that extract energy from the hot rock resources found everywhere in the world hold much promise for expanding the production of geothermal power and heat.

This roadmap envisions that by 2050, geothermal electricity generation could reach 1,400 TWh per year, i.e. around 3.5% of global electricity production. Geothermal heat could contribute 5.8 EJ annually by 2050. For geothermal energy for heat and power to claim its share of the coming energy revolution, concerted action is required by scientists, industry, governments, financing institutions and the public. This roadmap is intended to help drive these necessary developments.”

The report has its flaws by looking primarily at EGS overlooking the great potential of conventional geothermal resources for both power generation and heating purposes. It also doesn’t stress out the unique position of geothermal with regards to the combined energy supply, as well as the great potential geothermal could play for individual countries and regions. The International Geothermal Business Coalition, a joint group by several international Geothermal Energy Associations believes that the quoted potential of geothermal providing 3.5% of total electricity supply in the world, is probably not ambitious enough.

The report is available here: IEA Geothermal Technology Roadmap (pdf)

As previously announced, to achieve production in wells SJ 12-1 and SJ 12-2, the Company had decided to re-drill both wells. The re-drills were expected to correct the problems encountered in the original drilling and reach the originally planned intersection of deep production zones. In February 2011, the Company re-appointed Sinclair Knight Merz (“SKM”), a leading global consulting firm in the geothermal industry, which has extensive experience in drilling and analyzing the resource at San Jacinto-Tizate where they successfully drilled 40MW. SKM’s expertise in well targeting contributed to better definition of inclination and azimuth angles for directional wells. SKM’s experience with the San Jacinto-Tizate resource field led to optimal selection of drilling fluids, flow rates, and drilling penetration rates and greater use of perforated liner which were successfully utilized in previous drilling at the resource field. In addition, SKM has a drilling engineer and a scientist on site and is actively evaluating the techniques used for drilling to reduce drilling costs and frequency of drilling incidents. Forking or side-tracking of existing wells has achieved production earlier and at less expense than drilling new wells.

Under SKM’s direction, the Company commenced the re-drill of well SJ 12-1 ST1 (a sidetrack recovery of the SJ12-1 well) in February 2011. The well was completed in March 2011 to a depth of 8,544 ft., and upon completion was immediately evaluated with an injection test designed to determine permeability. A standard three-step injectivity test was conducted by pumping water to depth in the well at high rates for an extended period of injection. The injectivity index which measured 20 t/h/bar indicates moderate to good permeability for the well. Typically wells with similar injectivity index measurements drilled at San Jacinto-Tizate are commercial producers and SKM estimates that the capacity of the well is expected to be in the 5 – 10 MW range. After a heat up period, a long-term flow test which involves the connection of well SJ12-1 ST1 to a test separator will be performed and the results will be certified according to the project lenders protocols in May 2011 by GeothermEx, Inc.

The Company completed the initial drilling of SJ 12-2 in January 2011. The well was drilled to a depth of 7,532 ft. at which point a drill rig power failure resulted in the drill string becoming stuck in the well. At that time the well was experiencing a total loss of circulation of drilling fluids which provided an indication of high permeability. After several attempts to free and retrieve the drill string, the drill string was severed at a depth of 7,228 ft. After four days of initial flow testing, despite having 276 ft. of stuck drilling apparatus at the bottom, the well produced separated steam at a rate of 31 t/hr at design pressures for the turbine inlet with production from a down hole zone that exceeded 510°F. These initial results confirmed that well SJ12-2 will be a production well with an estimated capacity of about 4 MW. In order to maximize the potential production from this well, the Company plans to fork SJ12-2 while retaining this initial productive leg of the well. Drilling of the SJ12-2 fork will commence by the end of this month and completion of the drilling is expected in May 2011.

The San Jacinto-Tizate exploration drilling program is focused on developing the geothermal resources needed for the phased power plant expansion designed to increase production from the current 10 MW to 72 MW. Currently, the Company has 60 MW of certified resource in San Jacinto-Tizate. With the successful re-drill of SJ 12-1 ST1, the flow test results and subsequent fork of SJ 12-2, and the planned acid wash of well SJ 9-3 (currently certified at 4.8MW) the Company anticipates these three wells will increase the certified resource capacity by 12 to 25MW.

Greg Ussher, Geophysicist, Manager Generation Clients at SKM, stated that, “Our team is very pleased to again be working with the Ram Power team on the San Jacinto geothermal project. It is encouraging to have early indications of success with both SJ12-1 ST1 and SJ12-2, which gives us confidence for the on-going production and reinjection drilling program.”

Walt Higgins, interim President and CEO of Ram Power, stated, “We are extremely pleased with these results. The addition of SKM, combined with the Company’s strategic change in the drilling program has produced positive results and we look forward to our continued working relationship with SKM.”

Source: Company release via Digital Journal

In a piece by Energias Renovables, it says that GTherm’s system, as a single-well engineered geothermal system (SWEGS), uses much less water and therefore would be an interesting option to operate such a plant.

Today, there are five geothermal units in Costa Rica, producing around 165MW of electricity at the Miravalles geothermal field. Geothermal power represents today around 13 percent of Costa Rica’s total installed electricity generation capacity.

Source: PowerGen Worldwide

San Jacinto – Tizate Project Update – Phase I and II Construction, Drilling and Financing

The Company continues to make good progress on both the Phase I and Phase II expansions (36 MW each) of the San Jacinto-Tizate power project (the “San Jacinto Project”) to increase the production capacity of the current operating facility from 10 to 72 MW net. As disclosed previously, the Company has an executed power purchase agreement for the Phase I and Phase II expansions, existing active production and injection wells with sufficient capacity to support the Phase I production increase, and $237 million of debt financing to support the construction of both the Phase I and Phase II expansions. With these essential project components in place, the Company expects that upon completion the project will be a significant driver of future shareholder value.

As of January 31, 2011, Phase I of the San Jacinto Project expansion is approximately 75% completed. The Phase I expansion was originally scheduled to be completed in 18 months with a target commission date of April 2011. However, the project has encountered construction delays and is now expected to be completed in 21 months with a target commission date of July 2011. As a result of unfavorable variances in some material and labor costs and the construction delays, the project has approximately $15 to $20 million of additional construction costs. The Company expects to contribute $10 to $15 million of additional equity to the project to cover the cost overrun with the balance covered by contingent debt reserves

Concurrent with the Phase I expansion, the Company commenced construction on the Phase II expansion in 2010. As of January 31, 2011, the Phase II expansion of the San Jacinto Project is approximately 30% completed. The Phase II expansion was originally scheduled to be commissioned in December 2011. As a result of the construction delays in the Phase I expansion, the Company is now projecting a revised commission date of March 2012. As a result of the construction delays, the Phase II expansion has approximately $5 million of additional construction costs (excluding drilling) which will be covered by contingent debt reserves.

Over the past 10 months, the Company’s San Jacinto Phase II exploration drilling program has drilled four wells SJ12-1, SJ9-2, SJ9-3, and SJ12-2. To complete the Phase II drilling plan the Company must increase its current certified resource capacity from 56 MW to 84 MW gross. To date GeothermEx, Inc. (“GeothermEx”) has certified the production capacity of the SJ 9-3 well to be 4.2 MW based on long-term flow tests. In their current state of completion, wells SJ 12-1, SJ 9-2 and SJ 12-2 are not capable of sustaining continued commercial operations. To achieve production in wells SJ 12-1 and SJ 12-2, the Company has decided to re-drill both wells. The re-drills are expected to correct the problems encountered in the original drilling and reach the originally planned intersection of deep production zones.

The Company has retained outside consultants to assist in the re-drilling and preliminary probability estimates anticipate the re-drilling of SJ 12-1 and SJ 12-2 to result in 10 MW to 20 MW gross of additional resource capacity. The Company expects to complete the re-drill of SJ 12-1 and SJ12-2 by the end of March 2011 and May 2011, respectively. Despite well SJ 9-2 having a high bottom hole temperature, the well has not demonstrated enough permeability to sustain commercial flow rates and the Company has been using cold water injection to stimulate the well and increase the permeability. The Company has no future re-drill plans for SJ 9-2. Should additional production wells be required to meet the certified resource requirements, the Company plans to drill an additional well SJ 12-3. Under the revised Phase II exploration drilling program, the Company is expected to incur approximately $27 million of additional drilling expenses to complete the program.

On November 4, 2010, the Company closed a $160 million debt facility (the “Facility”) to finance the Phase II expansion which consists of $140 million in senior construction and term loans and $20 million in subordinated debt which is available for contingencies and for general corporate purposes. In addition to customary funding conditions, access to the Facility requires that GeothermEx certify that the steamfield for Phase II is sufficient to achieve production of certain MW levels. The Company is unable to access the Facility due to the current certified resource capacity of the San Jacinto Project. The minimum production level which must be certified for the San Jacinto Project as a whole to access the Facility is 64.8 MW gross. Upon certification of this production level, the Company will have access to $70 million of the Facility. As noted above, the Company currently has approximately 60 MW gross of certified resource capacity. Access of up to $98 million of the Facility will be available upon certification of the 70 MW gross level, and the Company will have access to approximately $7 million of additional funding under the Facility for each additional 2.4 MW gross of certified resource capacity. In addition, depending upon the MW levels certified, the Company is required to make available equity funding which, together with loans made under the Facility, are sufficient to complete construction of Phase II. The Company has been funding Phase II construction and drilling with equity which totals approximately $57 million to date. Additional equity funding required to meet the minimum levels needed to access the Facility will be funded in part from the corporate credit facility described below. As the Company achieves increased certified resource capacity through its drilling program, the Company expects approximately $45 million of its equity investment in Phase II to be returned through borrowings under the Facility.

Corporate Financing

Given the delay in reaching the resource certification levels necessary to access the Facility for Phase II of the San Jacinto Project, and the projected construction cost overruns in Phase I, the Company has obtained additional interim financing to cover these unexpected cash needs. The Company has successfully negotiated a $50 million, two-year bridge loan commitment with Sprott Resource Lending Partnership, Exploration Capital Partners 2008 Partnership and Newberry International Holdings Ltd. (collectively, the “Lenders”). An interim facility of $12 million was closed and funded by the Lenders on February 4, 2011. Interest at the rate of 12% per annum is payable monthly on the interim facility commencing on March 4, 2011. In addition, there is a standby fee in the amount of 1% of the commitment under the interim facility and a drawdown fee in the amount of 1% of the amount advanced. The term of the interim facility is six months. The interim facility is secured by the assets of the Company and its subsidiaries other than assets which have been previously pledged or have certain restrictions preventing them from being pledged. As of the date hereof, $7.8 million of the interim facility has been advanced to the Company to be used for the drilling programs at San Jacinto and at the Company’s Orita project in Imperial Valley, California, construction costs at San Jacinto, and working capital. The Company and the Lenders are currently finalizing the documentation for the full $50 million, two-year bridge loan which will refinance the interim facility and provide an additional $38 million of funding for the Company. The Company expects the $50 million facility to close in March 2011.

Hezy Ram, CEO of Ram Power, stated, “Despite the setbacks on the San Jacinto Project, the tremendous value of the Ram Power portfolio of project assets enabled the company to attract the necessary financing at a critical time that will enable us to reach our objectives and deliver long-term shareholder value.”

Source: Company release (pdf)

According to the report 24 countries around the world were utilising geothermal energy for electricity production in 2010. The world’s total installed capacity in 2010 was 10.715 MWe, a 20% increase from 2005. The U.S. leads the way in terms of installed capacity with 3.074 MWe followed by the Philippines with 1.902 MWe and Indonesia with 1.187 MWe.

The U.S. also leads the world in terms of developing projects with over 150 geothermal development projects underway in 13 states with an estimated power generating capacity of 4,584 – 7,057 MWe. Indonesia has a project pipeline of 3.500 MWe in the next five to ten years followed by Iceland which has projects at various stages of development with a combined potential capacity of 1.170 MWe.

Geothermal energy has a lower levelized cost of electricity then all other renewable energy sources except for biomass. It also compares favorably to advanced coal and advanced gas power plants.

Japanese firms Fuji, Mitsubishi and Toshiba have a 67% market share in direct steam turbines while Ormat Technologies dominates the market for binary systems.

The latest phase of geothermal development is being driven by government support mechanisms and the liberalization of electricity markets around the world. Over 63 countries now offer some sort of support mechanism for the production and sale of electricity produced from renewable energy sources.

An overview on the report, as well as details on how you can purchase a copy of the report see the website of KPMG Iceland

Berlin, a city founded in the crater of the long-extinct Pelon volcano, surrounded by hillsides on which coffee plantations spread up to an altitude of 1,500 metres, has a geothermal power plant.

To the north-west, the thickly wooded hillside blends into the flat lands around the Lempa river, always with an eye on the faraway San Miguel volcano, more than 3,300 metres high.

Suddenly, a clear, steaming monster emerges from the green landscape, with pipes disappearing in all directions and large containers giving off more steam.

This is the Berlin geothermal plant in Usulutan province, which together with the Ahuachapan geothermal plant in northern El Salvador meets almost one quarter of the Central American country’s electricity demand.

‘Volcanoes are dangerous, but one can also benefit from them,’ says Carlos Ernesto Melgar, the plant’s head engineer.

In Berlin, water and steam emerge from 1,200 metres underground at a temperature of 300 degrees.
In 14 places across the site, the Salvadoran-Italian energy firm LaGea has bored holes in the hot magma layers of a volcano that is only inactive on the surface. A relatively simple process turns the mix of water and steam into dry steam, which turns two turbines to produce electricity.

These favourable conditions are common to practically all of Central America and Mexico, where there are hundreds of mostly extinct, some dormant and a few active volcanoes.

‘Here, hot water lies virtually right under the surface,’ says Rainer Schroeer, an energy expert from the German Society for Technical Cooperation (GTZ). ‘Virtually all one has to do is to push aside the soil, and one finds hot water.’

In the future, the GTZ will focus on using geothermal energy for ends beyond large power plants. In El Salvador, a potentially ground- breaking project is currently underway that German Development Aid Minister Dirk Niebel, who visited El Salvador in early October, described as a beacon.

The German company Duemmen, from Rheinberg in the Lower Rhine, has set up the huge gardening business Red Fox, growing geraniums and other decorative plants in greenhouses on 44 hectares of land. Some 270 million plants are expected to be exported to the US market every year.

‘Investment conditions were best here in El Salvador, even better than in Mexico,’ says entrepreneur Simon Schulz.

So far, Red Fox has only been built to half of its intended capacity, but it has already generated around 400 jobs. Eventually, the firm hopes to employ 800 people.

Until then, hot water remains plentiful. It heats the greenhouses and provides power for artificial lights, refrigerators and pumps.

And if Red Fox turns out not to be profitable, Schulz will try his luck with a different source of energy with which El Salvador is similarly blessed: the sun.”

Source: Monsters and critics

The Project is currently the largest geothermal construction project in Central America. The proceeds from this debt financing together with equity previously invested fully funds the completion of the Project. The initial drawdown under the financing is expected to occur in December 2010.

As previously disclosed, the phased expansion of the Project is designed to increase production from the current 10 MW to 46 MW in the first half of 2011 (Phase I). The 46 MW capacity will be expanded to 72 MW in the latter part of 2011 (Phase II). There is a long-term power purchase agreement in place with a subsidiary of Gas Natural Fenosa, a Spanish utility. The expansion will bring state of the art geothermal technology to an existing utility-scale power facility that will supply low cost geothermal energy to the region.

In connection with the Phase II financing, CABEI and FMO have assumed the Phase I commitments and loans of Export Development Canada, and Corporacion Interamericana para el Financiamiento de Infraestructura, S.A. has acquired the Phase I commitments and loans of Cordiant Capital which are being made available under a “B” Loan structure from CABEI. In addition, the parties have entered into an Amended and Restated Credit Agreement in order to more closely align the Phase I and Phase II financing terms.

Bernie Sheahan, IFC Director for Infrastructure in Latin America said, “The San Jacinto project, one of IFC’s first investments in a vertically integrated geothermal power project, furthers our regional development strategy. Its successful implementation has great significance for Central America, which could increase its renewable energy generation significantly by developing geothermal resources which are cleaner and cheaper than existing alternatives.”

“The Second Phase financing for the San Jacinto-Tizate project represents a significant milestone for Nicaragua, and the government of Nicaragua is fully supportive of this project as part of our plan to transform the energy matrix and become independent from oil derivatives in the generation of energy,” stated Emilio Rappaccioli, Minister of Energy and Mines of Nicaragua. “The project represents one of the largest geothermal projects in Central America, and will provide clean, reliable energy to the people of Nicaragua long into the future.”

Hezy Ram, CEO of Ram Power, said “The San Jacinto-Tizate Phase II credit facility signing represents yet another milestone in Ram Power’s plan to provide clean geothermal energy to Nicaragua. We want to thank the Phase II project lenders for their continued confidence in Ram Power’s project development team and in the San Jacinto-Tizate geothermal power project.”

Greentech Capital Advisors, an investment advisory firm focused exclusively on the alternative energy and cleantech sectors, and PAF Securities, an investment advisory firm specializing in the Latin American and Caribbean markets, acted as financial advisors to Ram Power.”

Source: Release via Marketwatch

Simon Ridgway, the President of Radius, commented: “We’re delighted to be working with Molten on the exploration and development of our geothermal concessions. With the tremendous interest in carbon-neutral, renewable energy, I’m pleased that our exploration programs may be able to contribute to the development of clean energy sources in Central America.”

Under the terms of the option, and subject to satisfactory technical and legal due diligence by Molten, Molten shall have the exclusive right to earn a 100% interest in the concessions from Radius by issuing 2 million shares in staged tranches according to a defined schedule.

Molten shall also issue to Radius warrants to purchase up to 1,000,000 shares exercisable for a period of five years from the date of the definitive agreement at a price of $3.00 per share.

Royalty: Radius also retains a two percent (2%) royalty of the Gross Revenue for the sale of geothermal electric power from the first power generation facility built on each geothermal licence. Molten may, at its discretion, purchase at any time prior to the commencement of the commercial operation date one half (1/2) of the 2% royalty from any geothermal license for the sum of CAD$30,000/MW nameplate capacity of the first power generation facility built on each geothermal licence. Any expansion of the nameplate capacity on any of the licenses is not subject to royalty payments.

About Molten Power Corp: Molten is a Vancouver based geothermal power development company. Molten’s mission is to create shareholder value through the acquisition, exploration, development and operation of geothermal power projects worldwide. Molten’s current project areas of interest include the western USA, Philippines, Guatemala, western Turkey, Indonesia, Eastern Africa and Hawaii.”

About Radius: Radius has been exploring for gold in Latin America for nearly a decade, and has assembled interests in a portfolio of promising gold projects throughout the region, including carried stakes in two small-scale developing gold projects in Guatemala and Nicaragua. Radius also has two 100% owned exploration plays, the HB property in Guatemala and the Sixty Mile property in the Yukon Territory.”

Source: company release via PR Newswire

Stuart Johnson, Vice President of Resource Development, stated, “The Phase II drilling campaign at our San Jacinto-Tizate project is proceeding on schedule with two production wells (9-3 and 12-1) drilled, well 9-3 successfully tested and a third well currently being drilled with completion scheduled in late October. Should these Phase II production wells test positively, this new production capacity, when added to the already certified and existing Phase I capacity of 46 MW, results in sufficient steam under valves to complete the full planned 85 MW expansion of the project.”

The phased expansion is designed to increase production from the current 10 MW to 46 MW in the first half of 2011 (Phase I). The 46 MW capacity will be expanded to 72 MW in the latter part of 2011 (Phase II). In 2012 there will be a bottoming unit added which will increase production to an anticipated capacity of 85 MW without the need to drill more production or injection wells. There is a long-term power purchase agreement in place with a subsidiary of Gas Natural Fenosa, a Spanish utility. The expansion will bring state of the art geothermal technology to an existing utility-scale power facility that will supply low cost geothermal energy to the region.”

Source: Company release via Marketwatch

Phase one construction began in December and will take production to 46MW from 10MW by the first quarter of 2011. Phase two will take output to 72MW by December next year.

The financing will be in the region of US$160mn and will be led by IDB and IFC, Ram said at a conference.

He added there are plans for an additional 30MW by putting in a bottoming unit.

In Nicaragua, Ram also is developing the Casita San Cristobal geothermal concession, which is 25 miles (40km) from San Jacinto with capacity estimated at 140-150MW.

Work underway at this project includes construction of a road and the drilling pad, while an LOI has been signed with distributor Disnorte-Dissur for the purchase of 144MW, said the executive.

The 24-month development plan kicked off last quarter and includes the drilling of two deep exploration wells, the company said previously. The concession is in the northwest department of Chinandega and energy deliveries to Disnorte-Dissur could begin in 2013.”

Source: Insider Fortunes

Invitations for nomination of candidates will be sent out in early September.

For preliminary information and programme see here (pdf).

Source: UNU-GTP

In Q2 the company “spent approximately C$51.6 million on additions to geothermal properties and capital assets, including approximately C$23 million on the Phase I and II San Jacinto expansions, C$20 million to acquire the land rights associated with the Geysers project, and approximately C$6.5 million on the Orita Project.”

Hezy Ram, CEO of Ram Power, said, “Ram Power continued in the second quarter of 2010 to execute its plan to be one of the world’s preeminent geothermal power companies. Construction of Phase I and II expansions at our San Jacinto-Tizate project proceeds according to the schedule and budget. We are in the final stages of the negotiation process for the Phase II expansion’s financing, which is expected to close in the third quarter. Drilling activity commenced at the Orita project in parallel to negotiations with EPC contractors. We recently purchased the land rights associated with our Geysers project in Northern California which will allow for flexibility and autonomy in the development of this project, which is a continuation of our commitment to developing our pipeline of projects to their full potential. As well, the Company announced the pending acquisition of Sierra Geothermal Power Corp.”

Nicaragua: The San Jacinto operating plant produced as expected during the quarter with short interruption to correct the decline performance of an injection well. In early 2010, the power plant was not producing to its full capacity due to insufficient injection at the SJ-1 well. During the second quarter ending June 30, 2010, the Company completed a mechanical cleaning of that well which resulted in full recovery of the injection capacity of this well. The clean out operation restored the net MW production of the power plant to its optimal 9.6 MW.

Construction continued during the second quarter on the Phase I 36 MW expansion of the current operating facility to increase the production capacity to 46 MW. The Company expects a commercial operation date in the second quarter 2011. The current active production and injection wells have sufficient capacity to support the planned production increase. The total cost of the Phase I expansion is estimated to be $156 million. The Company is using a combination of cash on hand and a $77 million credit facility to fund the cost of the expansion. In the six months ended June 30, 2010, the Company satisfied the equity investment requirement for the credit facility and drew $47 million of the $77 million available under the facility. As of June 30, 2010 the Company had approximately $90.7 million in accumulated costs related to the Phase I expansion.

The Company commenced its drilling/exploration program for Phase II of the San Jacinto Project in April 2010 with two rigs. The first exploration/production well (SJ 12-1) was completed in July 2010 and encountered fault-controlled permeability at several shallower zones. A maximum temperature of over 500 degrees Fahrenheit was measured in the well. The well is being allowed to heat prior to temperature surveys and flow testing which will be conducted in August 2010. A second production well (SJ 9-3) commenced drilling by a smaller rig in June 2010 and was cased at 2,550 feet. Drilling on SJ 9-3 has resumed recently by a bigger rig and is currently being targeted to a depth of approximately 6,000 feet which is expected to be completed by the end of August 2010. The Company anticipates completing its Phase II drilling program by March 2011.

The Company is in negotiations with a group of development banks led by International Finance Corporation (“IFC”) and Inter-American Development Bank (“IDB”) to provide the debt financing for the Phase II expansion, which will add 36 MW for a total capacity of 72 MW, after which the 10 MW facility will be decommissioned. Approvals were obtained for over $200 million senior debt financing which exceeds the expected financing need of $140 million. The approvals are subject to execution of a definitive agreement among the parties. Phase II is being constructed in parallel to Phase I and is being financed with cash on hand until the Phase II debt financing closes, which is expected to occur in the third quarter of 2010. As of June 30, 2010 the Company had approximately $27.1 million in accumulated costs related to the Phase II expansion.

Exploration Activities: In April 2010, the Company commenced its Orita drilling/exploration program starting with Orita Well #2 which was drilled as a direct offset to production encountered in the successful Emanuelli #1 well drilled in 1982. The Emanuelli #1 well produced about 500,000 pounds per hour which indicated commercial viability. Orita Well #2 was intended to test potential production zones down to 10,400 feet. Drilling was suspended at a depth of 9,267 feet due to mechanical problems and the well was lined with perforated casing, cleaned and tested. A maximum temperature of 457 degrees Fahrenheit was measured in the well still cooled by drilling mud. A flow test produced fluids that confirmed the desired low-salinity benign chemistry but only marginal permeability at this depth. In September 2010, the Company expects to resume drilling to the intended 10,400 foot production zone to enhance the fluid mass flow rate.

In July 2010 drilling commenced on Orita Well #3 which is being drilled to the targeted depth of about 9,000-10,000 feet. As of August 2010, the well shows significant hydrothermal alterations and is being drilled to intercept a major fault controlled low-resistivity zone. The drilling of Orita Well #3 is expected to be completed in August 2010. The well was successfully cased at 6,700 feet and is currently at about 9,000 feet. Flow testing will be conducted in the later part of August 2010.

Mr. Ram concluded, “Ram Power remains committed to the execution of our business plan which maximizes shareholder value through the development of clean, reliable geothermal projects.”

Source: Company release via Marketwatch

San Jacinto-Tizate is considered one of the highest quality geothermal resources under development worldwide, according to the bank.

This will be the second operating geothermal plant in Nicaragua and is expected to stimulate more private-sector investment in electricity generation.

The plant will bring the total contribution from the country’s geothermal resources to 15% of its installed capacity. Nicaragua has a target to reach 86% of electricity generation from renewable sources by 2014.

Completion of the second-phase expansion is scheduled for December 2011 at an estimated cost of $177m, which will be co-financed by a group of multilateral lenders, including the IDB.”

Source: Recharge News

“When Radius first entered Guatemala in 2001, its successful gold exploration programs were guided in part using the presence of hot springs as an indicator of potential gold-related hydrothermal activity. On at least one occasion Radius’s drill programs were halted because of large quantities of hot water and steam escaping from active drill holes, indicative of very high geothermal gradients. With the increasing global emphasis on clean, renewable power sources, Radius has revisited its hot spring database for Guatemala and staked a number of active geothermal systems that may have potential as geothermal resources for power generation.

Power generation in Guatemala is currently comprised of hydroelectric power stations, steam turbines, gas turbines, diesel generators and geothermal power stations, with geothermal power contributing less than 3% of the total power generated. According to a recent study by the Argentine consultancy, Montamat, which evaluated electricity prices in 13 Latin American countries, prices in Guatemala are amongst the highest in Latin America at roughly $0.17/kwh, surpassed only by the Dominican Republic and Panama. At the same time, the Guatemalan government is forecasting that electric power demand is expected to reach a compounded annual growth rate over 8.0% to 2015. Guatemala must increase its installed capacity to meet the projected demand growth.

A study published in International Geothermal Development in 2003 noted that geothermal resources in Guatemala are estimated at 800 to 4,000 megawatts (MW) capacity, but most likely around 1,000MW. In 2003 the country’s installed generating capacity was 1,700MW suggesting that geothermal energy could contribute significantly to securing the country’s future power requirements. By 2007, Guatemala had succeeded in harnessing 46 MW of geothermal energy in the fields of Zunil and Amatitlan, both owned by the American geothermal technology company Ormat Technologies. Feasibility studies are being carried out on 3 other geothermal fields.

Radius intends to use its extensive knowledge of Guatemalan geology, gained from more than 10 years of mineral exploration in the country, to identify and acquire potential geothermal resources. At the same time, the Company is actively looking for potential joint venture partners with the necessary experience to investigate and develop its geothermal licenses.”

Source: Company release via PR Newswire

According to the news piece, “The eruption of Volcano De Pacaya, about 30 kilometres south west of the capital, Guatemala City, has claimed three lives and damaged homes. Ormat, which began operations at its Amatitlan plant in 2007 on the volcano’s north-western flank, halted operations to protect the equipment.

The company reports no injuries to staff and “no substantial equipment damage” on preliminary inspection. “However, the plant will require a thorough clean up prior to restarting,” Ormat says in a statement. The company is still assessing how long it will take to restore the plant to a condition in which power generation can restart.”

Source: RECharge News

The IFC has over the years financed a large number of renewable projects, among them geothermal projects.

The company is now evaluating an investment of up to US$60 million (US$ 40 million for senior debt, and US$20 million in equity/ quasi-equity) into Phase II of the San Jacinto project by Polaris Geothermal, a subsidiary of Ram Power, in Nicaragua to be put in front of its Board.

Details about the project and the potential involvement of IFC can be found here.

Here some details published on IFC’s website:

“Polaris Energy Nicaragua S.A. (“PENSA”, or the “Company”) owns the San Jacinto-Tizate geothermal concession covering a 40 km2 area near León, Nicaragua, that is estimated to have a geothermal resource of more than 200 MW capacity. Since 2005, under the concession, PENSA has owned and operated 10MW generation capacity comprised of 2 x 5MW back-pressure turbines (“B/P units”).

The Company is in the process of expanding its operations by adding another 72MW of capacity through 2 x 36MW Fuji flash turbines supported by further steam resource development, after which the original less efficient B/P units will be decommissioned (the “Project”). As is often the case with integrated (comprising both steam field and power plant) geothermal power plants, financing for the Project is being divided into phases to match the ramp up of geothermal development and the progress of construction. For this project, financing for the Project is being divided in Phase I and Phase II that each correspond to 36MW addition of capacity to the Company’s operations. IFC has been asked to consider providing financing for Phase II.

The Project will utilize geothermal resources from a smaller area within the larger concession (“Eastern Sector”), which has been in development since the 1950s by various parties and is estimated to contain a geothermal resource sufficient for the Project. The Company has been and will continue to sell its output to two utilities, both of which are subsidiaries of Union Fenosa, a large Spanish utility, under power purchase agreements (“PPAs”) whose term end in 2029. The Company has deployed a group of the world’s leading contractors/suppliers to complement its own substantial in-house geothermal expertise: ThermaSource of the US in drilling, Construtora Queiroz Galvao of Brazil in construction, and Fuji Electric of Japan in turbine supply.”

Total project cost and amount/ nature of IFC’s investment is described as follows: “The total cost of the Project (Phase I and Phase II) is $309 million, of which $157 million is for Phase II. IFC has been asked to consider investment in Phase II of: (i) up to $40 million senior secured debt in PENSA for Phase II of the Project, and (ii) up to $20 million investment in equity/quasi-equity in PGI to be applied to construction costs of Phase II, both for IFC’s own account.”

Source: IFC