Hot Rock Limited been granted two more tenements in Peru
Australian Hot Rock Limited (ASX: HRL) announces the expansion of its geothermal exploration portfolio in South America, with the granting of the Chocopata and Quella Apacheta geothermal leases located in the South of Peru.
In a release by “Hot Rock Limited (ASX: HRL) today the company announces the expansion of its geothermal exploration portfolio in South America, with the granting of the Chocopata and Quella Apacheta geothermal tenements located in Southern Peru.
With these awards, Hot Rock now holds three granted tenements in Peru, to complement the company’s eight tenements in Chile. Five more Peruvian tenement applications remain in the final stages of processing and are expected to be granted within the next few months.
Both the Chocopata and Quella Apacheta tenements are conventional volcanic geothermal heat sources, which have associated surface hot springs with temperatures recorded up to 90OC and with extensive surface silica sinter deposits. This field evidence highlights the excellent prospectivity of these tenements for the proving of geothermal reservoirs suitable for electrical power generation.
Community consultation and land access programs are underway at both tenements and detailed geoscientific surface exploration surveys will be soon commenced.
Southern Peru offers both attractive infrastructure and electricity markets for geothermal power development. High voltage transmission lines occur within 70km of the tenement boundaries, allowing electricity sales into the National electricity grid or private industrial users and copper mines.
The electricity market in Peru was privatised in 1990’s and demand for electricity has increased substantially to keep pace with the high levels of development in manufacturing and mining reflected in Peru’s GDP growth in 2010 of 7%. A recent report from the grid operator COES highlights that annual energy and capacity demand in the next 10 year period will grow 6.2% to 75TWh and 10,500MWe, respectively. This will require that the electrical generation capacity of Peru be doubled over the next 6 years.
Peru currently relies on fossil fuel (52%) and hydro-electric (48%) plants for its electricity. Continuing drought is negatively impacting on electricity generation from its hydro-electric plants. In an effort to reduce Peru’s reliance on fossil fuels and hydro-electric technologies, the Peruvian government is vigorously supporting the development of renewable energy, including geothermal energy. Introduced legislation offers renewable energy sources incentives such as favourable electricity tariff mechanisms, tax benefits and priority of connection to the grid and electricity sales.
Hot Rock’s Executive Chairman Dr Mark Elliott said, “Hot Rock is taking advantage of its pioneer mover status in Peru, as highlighted by the early granting of the highly prospective conventional volcanic geothermal tenements at Chocopata and Quella Apacheta. With each additional tenement, the company significantly reduces development risk and increases the opportunity of discoveries in future exploration programs leading to potential development of geothermal power generation in Peru.
“The Peruvian government supports the development of geothermal energy, through legislation that provides a mechanism for setting feed-in tariffs, tax incentives and guaranteed connection to the grid and sale of all power produced. Given the quality of Hot Rock’s projects and experienced management team, the company is in an excellent position to benefit from these incentives by commercialising geothermal energy in Peru.”
Source: Company release (pdf), source of location map (Hot Rock Limited)