BEND, Ore., Feb. 24 /PRNewswire/ – Vulcan Power Company (“Vulcan”), a developer of geothermal energy projects, announced today that drilling has recommenced at the Company’s Patua project site near Fernley, Nev., located in the northwestern part of the state. Earlier this month, the Company received a second equity investment of $108 million from Denham Capital.
“Vulcan has assembled a team of some of the most experienced and knowledgeable professionals across the geothermal industry,” stated acting CEO Robert Warburton. “With financing in place, we can continue leveraging their talent and begin capitalizing on the resources available at Patua,” he continued.
Vulcan’s integrated drilling, geo-science, cementing, coring, engineering and construction teams will work over the next 24 months to complete Phase I of Patua, which is expected to be the Company’s first geothermal power plant, capable of producing 60 megawatts (MW) of clean energy. The initial focus will be on geo-science activities, drilling of core holes, and drilling of full size production wells to evaluate the resource reservoir. The Company is also in the process of securing permitting and transmission right-of-way for the project.
“We have welcomed back our drilling crews who previously underwent extensive geothermal training,” said Vice President of Drilling Virgil Welch. “Patua currently has two rigs in operation, drilling the first of our production wells,” concluded Welch.
Once drilling has been completed and project financing obtained, the engineering group will begin construction and commissioning of Vulcan’s first power plant. The Company projects commercial operation to occur in the first quarter of 2012. The output of the Patua plant will be sold under a 20-year term Power Purchase Agreement (“PPAs”) currently in the final stages of negotiation.
According to the Geothermal Energy Association, electricity generation capacity from geothermal energy in the United States is expected to triple within five years, supported by a federal government stimulus allocation of $400 million. In coming years installed capacity is expected to be nearly 10 gigawatts (GW), enough to supply 10 million homes.
Geothermal energy is a renewable power source by which naturally occurring hot water reservoirs are drilled, producing geothermal fluids that can be used as a clean alternative to fossil fuels burned to generate electricity. Geothermal reservoirs are replenished by injecting the produced water back into the reservoir, establishing a long-term renewable energy resource without any emissions of greenhouse gases.