KUTh Energy wins Saipan, Northern Marianas geothermal tender and concession
Australian an KUTh Energy wins Saipan, Northern Marianas geothermal tender and concession, which includes a grant for drilling of gradient wells.
In a release today, Australian developer KUTh Energy announces that “the Commonwealth Utilities Corporation (CUC) of Saipan has issued KUTh a Notice of Intent to Award a contract as follows: An exclusive concession issued to KUTh to develop geothermal power and sell electricity to the transmission grid with agreed milestones and timelines to be incorporated in the contract. A grant to KUTh from the Commonwealth of the Northern Marianas (CNMI) government for the amount of USD 1,100,000 to support the drilling of a 600 metre deep geothermal gradient well (Stage One Geothermal Gradient Project).
Additional grant funding available from CNMI for the amount of USD 500,000 to support follow-on assessment work (Stage Two Additional Assessment Work) if warranted and approved by CUC following the determination of the Stage One Geothermal Gradient Project. Previous studies undertaken by Southern Methodist University (USA) and National Renewable Energy Laboratory (USA) identify potential geothermal targets and rate geothermal as high impact on CNMI future power mix if resource can be identified.
Current base load diesel generation 30 MW and Peak load 45 MW. Compelling economics to replace diesel with geothermal base load power. The success of the Saipan tender builds on the company strategy to become a significant player in the development of geothermal energy to displace high cost diesel generation in remote grid locations.
Commenting on the successful tender, managing director David McDonald said, “I am very proud of the team effort to secure this tender in Saipan. We have stayed consistent to our plan of seeking projects where a potential geothermal target exists and the market dynamics offer a compelling reason to investigate. This project was identified by KUTh before any grants were announced and initial reconnaissance has paid off. This allowed us to get a head start on the RFP process and to show a commitment that earned the respect of people in Saipan”.
David further commented that “the geotechnical programs and extensive geothermal gradient drilling that we have undertaken in Tasmania has demonstrated our ability to take a green field geothermal play and implement structured exploration programs to pinpoint a geothermal drilling target. There is also no question that our exposure to the Vanuatu project has extended our role into volcanic hosted geothermal plays and broadened our contacts through the geothermal development chain. It has also highlighted our ability to work through the issues related to remote grid power development. All these issues will be important as we progress through the various steps of the Saipan project. The inclusion of the exclusive concession to the company for the development of geothermal on Saipan will allow the company to conduct a structured exploration program with clear security of tenure. We are looking forward to working with the CUC team and its technical advisors as we implement the first stage funded geothermal gradient project”.
Saipan – Commonwealth of the Northern Marianas
Situated north of Guam in the Pacific Ocean, the Commonwealth of the Northern Mariana Islands (CNMI) comprises 14 islands. Saipan (the capital), Rota, and Tinian are the main islands. CNMI is a self-governing US territory and the US President is its Head of State. The government of Saipan has secured funding from the US government to support the geothermal exploration Stage One works being undertaken by KUTh.
Source: Company release by email