Petratherm invited to apply for $13m in government funding for Paralana project

Paralana 2 Well Injectivity Test in January 2011 showing some hydraulic pumps (left) and Coil Tubing Unit (right) (source: Petratherm, June 2011)

Alexander Richter 5 Sep 2012

News from Australia this morning report that Australian geothermal development company Petratherm (ASX: PTR) “has been given the opportunity to apply for government funding for about half the cost, or A$13 million (US$13.3 million), of the next stage of work at its Paralana geothermal project in South Australia.

This involves the drilling and fracture stimulation of the Paralana-3 deep well and the demonstration of economic flows between the Paralana 2 & 3 deep wells.

A successful demonstration will prove Petratherm’s ability to supply electricity, initially to the nearby market of Beverley Uranium Mine

The company had been invited to submit a Project Funding Application under the Australian Renewable Energy Agency (ARENA) $126 million Emerging Renewables Program.

This will include the plan and budget for the next stage of works, detailed information on the merit of the project and an outline of matching funding strategy sufficient to complete the next stage of works.

Petratherm noted that if it is successful, it expects that the balance A$2.8 million of unused funds from the A$7 million Geothermal Drilling Program grant would have to be relinquished.

It added that it may receive up to A$7.2 million in cash rebates following recent changes to the R&D Tax Incentive, which now provides companies with eligible R&D expenditure to receive refundable cash tax offsets equivalent to 45% of expenditure.

Petratherm has also been exploring further avenues to enable it to satisfy its share of funding for the next stage of the Paralana project, which it holds a 79% interest. Beach Energy (ASX: BPT) holds the remaining 21%.”

Source: Proactive Investors