Australian Earth Heat Resources (ASX: EHR) has – according to a recent release – “commenced the first phase in a Feasibility Study for the ‘fast track’ development of a 15 megawatt (MW) geothermal plant at the company’s Copahue Project in Argentina.
In light of the new upgraded resource figures announced on May 18, the scope and objectives of the stage one concept study have now been outlined.
The company plans to split the study into two successive phases, with phase A being a concept screening to agree on a viable technical solution, and Phase B detailing the agreed upon concept and integrating other project factors.
Earth Heat intends to use the Feasibility Study to secure financing needed to accelerate the plant to reach production and ultimately generate cash flow.
Consideration of future expansions will be included in the study given the substantial resource estimate of up to 264MWe.
Torey Marshall, managing director, said “this week has been a turning point for the company insofar as it has shown Copahue to be a world class resource, and with the existing information, our shareholders can be comforted that the next drilling will be in support of a development, rather than in search of a (resource) number.
“The next two months will yield significant achievements and news that will continue to reshape Earth Heat in the eyes of investors as it marches towards first cash flow.”
The company has engaged leading engineering firm Sinclair Knight Merz (SKM), to advise and assist in the design and construction of the geothermal plant.
Earlier this week, Copahue received a 150% jump in total resources interpreted from SKM, under the new Canadian Geothermal Code (CanGEA) classified resource estimate, in terms of electricity generating capacity and stored heat in place (based on P50 probability).
The outcome provides for significant additional scope for development at the project, with the potential energy generated for consumers in the Neuquen Province of Argentina.
Of particular significance is the ‘behind pipe’ verification which provides a boost to the certainty of the stage 1 plant size and reduces the immediacy of resource extension drilling.
The Copahue project is located 55 kilometres to the national electricity market interconnector, with a sealed bitumen road to the site from Neuquen City.
Other infrastructure includes power lines connected from the site to the nearby town of Caviahue, a plentiful water supply with oil field services and equipment in the Province.”
Source: Company release via ProActive Investors