Geodynamics satisfies $90m grant conditions

Geodynamics satisfies $90m grant conditions Geothermal drilling rig at Jolokia, Australia (source: Geodynamics)
Alexander Richter 15 Oct 2010

Australian Geodynamics announces that it meets all conditions precedent for a US$90m grant under the Australian Renewable Energy Demonstration Program for its Cooper Basin EGS project.

In a release by the company, “Geodynamics Limited announces that all conditions precedent for the AU$90 million (US$89.5m) grant awarded to the Company under the Federal Government’s Renewable Energy Demonstration Program (REDP) have been satisfied. Geodynamics has received confirmation from the Department of Resources, Energy and Tourism that the grant is now unconditional and that funding will commence in line with agreed milestones.

The AU$90 million grant was initially awarded to Geodynamics in November 2009 and is the largest amount awarded to any project under the program. The funding deed was executed by the Federal Government and Geodynamics in July 2010. Satisfaction of the conditions precedent is the last step in the process before Geodynamics can commence drawing on funds under the program.

The REDP funding will assist in the establishment of a 25MW commercial demonstration plant (CDP) in the Cooper Basin and will be staged over the life of the CDP project. First payments will be received following achievement of agreed project milestones, commencing with the drilling of the next planned well in the program, Habanero 4. Further payments will be made for drilling subsequent wells and construction of the CDP with the final instalment to be received following commissioning of the CDP, expected to occur in early 2015.

Geodynamics’ Managing Director, Dr Jack Hamilton, said, “This funding support is vital for demonstrating to all stakeholders that we have full unconditional support of the Federal Government in bringing our vast Cooper Basin geothermal resource to market. Our work program to commercial demonstration is the next major phase of Geodynamics’ development and we are grateful that this is supported by the Federal grant. We look forward to achieving commercial demonstration with support from the Government and our joint venture partner, Origin Energy.”

Source: company release via e-mail