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Reservoir Capital Corp updates on Serbian project at Vranjska Banja

Spa clinic at Vranjska Banja, Serbia (source: vrnjacka-banja.co.rs)
Alexander Richter 20 Sep 2010

Reservoir Capital Corp reports initiated reservoir testing on third party owned geothermal wells within the company's Vranjska Banja Geothermal Exploration License in southern Serbia.

In a release by the company, “Reservoir Capital Corp. reports  that its contractor Geofizika-Ing has completed equipment installation and initiated reservoir testing on the third-party owned VG-2 and VG-3 geothermal wells that lie within the Company’s Vranjska Banja Geothermal Exploration License in southern Serbia. Preliminary readings during equipment installation have so far confirmed historical data, but the first full 35-day well test was initiated last week to start to more systematically test the reservoirs. The Company is running tests to measure water temperature, pressure, flow rates and chemistry, through a twelve month cycle to assess the reservoirs potential for renewable electricity generation.

The Company’s Vranjska Banpja exploration permit covers 1,750 hectares in area and surrounds the 2 hectare exploitation permit held by the Jumko A.D. (“Jumko”). In May 2010 the Company signed an agreement with Jumko to evaluate its VG-2 and VG-3 wells, which are currently set up to supply a nearby spa facility. The VG-2 well cuts several hot water aquifers, the best of which measured 126 degrees centigrade between 864-890 metres depth. The VG-3 well intercepted a zone containing three intervals with measured temperatures of 124 degrees centigrade, between 1,500 and 1,575 metres depth. The Company has also reinterpreted existing geophysical data (magnetics and gravity) and completed its own follow-up magnetic surveys and geological mapping within its license area to define additional targets.

Brodarevo Project Update: The Company completed positive Pre-Feasibility Studies for its Brodarevo 1 and Brodarevo 2 hydroelectric projects in July 2010 (see Company news release of July 14, 2010 for details). Since then tender processes have been launched for the Feasibility Studies for the dams and moving the road, for which the Company expects to select and appoint contractors in the next week or two. During last week, a decision was received from the Ministry of the Environment and Spatial Planning, defining the scope and content of the Environment Impact Assessment Study, permitting the Company to now move ahead with contracting that work as well.

The Company is also pleased to report that it has received several expressions of interest from European utilities and trading companies to provide power purchasing agreements for Brodarevo and other renewable energy projects the Company may develop in the region. Government delegations from Italy and Serbia met this week in both Rome and Belgrade to complete ratification of the bilateral energy agreements, which are expected to pass into law in the coming months, permitting the certification of renewable energy from Serbian sources like Brodarevo.”

Source: Company release via Marketwatch