Panax Geothermal with measured resources of about 1,400 MW

Alexander Richter 7 Jul 2009

Panax Geothermal (ASX:PAX) recently announced that “an independent asssessment has measured the geothermal resource at its Tirrawarra Project in GEL281 in the Cooper Basin in South Australia at 11,000 PJ.

Put it in perspective, approximately 150 PJ of the Tirrawarra Project’s resources would be sufficient to generate 20 Mega Watts (net) of electric power for 30 years.

Combine Tirrawarra’s resources with the 11,000 PJ at the Penola Project in South Australia’s Otway Basin – and Panax currently owns two of Australia’s only three measured geothermal resources.

Clearly, this is significant in any analysis for a (geothermal) company under 18 months of existence.

Tirrawarra project is located in a relatively remote location, about 35km north of Moomba in South Australia’s Cooper Basin – Australia’s main on-shore gas and oil processing facility.

Panax CEO Bertus de Graf said, “most of the exploration risk normally associated with Inferred Geothermal Resources has been eliminated. Ownership of these two advanced geothermal opportunities puts Panax in a leading and unique position as a geothermal exploration and development company in Australia.”

Interestingly, Tirrawarra has a further 30,000 PJ indicated, combining to make a total of 41,000 PJ.

Investors may recall that both projects are based on Hot Sedimentary Aquifers (HSA), which use the energy stored in hot water contained in existing aquifers or reservoirs to generate power.

The development of HSA projects is considered faster because it targets hot water contained in existing reservoirs (aquifers). In contrast with Hot Fractured Rock (HFR) Geothermal Resources, HSA Geothermal Reserves can be established by drilling only one well, which can subsequently be utilized as a production well.

Once flow rates are established, HSA projects can be developed using commercial, off the shelf binary geothermal power plants.

It is planned that geothermal power from the Tirrawarra Project may replace costly diesel power generation which is widely used in the oil and gas production in the region.

Panax is applying to the Commonwealth’s Geothermal Drilling Program for a $7million grant for drilling a production well in the Tirrawarra Project.

Anticipation should begin to build with the first production well, Salamander 1, at the Penola Project in the Limestone Coast region of South Australia due to spud in September, 2009.”

Source: ProActive Investor