Concerns raised about Northern Marianas seriousness on geothermal plans
Saipan, Northern Marianas, west Pacific Ocean (source: flickr/ Matt Watts, creative commons)
Alexander Richter
21 Aug 2012
With an announcement of a controversial $190 million diesel-power plant project, Australian developer KUTh Energy hopes the government of the Northern Marianas will honor the exclusive geothermal exploration concession awarded to the company earlier this year.
Following the announcement of a $190 million deal for a diesel-fuel based power plant in the Northern Marianas, Australian geothermal developer KUTh Energy has raised concerns.
The company had won a tender for the development of a geothermal power project on the island group.
The U.S. Department of the Interior had provided $1.2 million in funding assistance for geothermal exploration and development in the Northern Marianas. KUTh Energy was selected as part of a tender to drill a 600m deep geothermal gradient well.
KUTh Energy managing director David McDonald said in an email: “The intent to award was based on a very comprehensive response to a request for proposal. We were shortlisted and along with the other shortlisted candidates we presented to the selection committee in Jan. 2012 and were advised to be the successful candidate and then the intent to award was issued.”
He added, “I would like to think that the CUC/CNMI government would proceed with contract since they were the ones who initiated the RFP and the intent to award after a lot of work was put into the tender process.”
He said the “proposed diesel generation contract is something that we are still investigating to fully understand how this fits into the Saipan power strategy.”
McDonald said they are “struggling to understand why a diesel power generation would be prioritized over renewable energy initiatives. The ability to generate electricity from your own resources (such as geothermal) will supply base load power, energy security (rather than being totally dependent on imported fuel for your power), lower cost and a stable pricing (imported diesel will always be subject to the price on international markets).”
The company seems to have some serious doubts about the seriousness of the Northern Marianas’ administration in its push for renewable energy development, that would provide an independence from fuel price fluctuations and increasing energy prices. But KUTh is still “hoping the administration will honor the exclusive concession awarded to the company to develop geothermal power in the commonwealth.”
Source: Marianas Variety, Marianas Variety
