News

Mining company seeking PPA from Copahue project in Argentinia

Cordillera, Cerca de Copahue, Argentina (source: flickr/ patricia_sgrignuoli, creative commons)
Alexander Richter 30 May 2012

Earth Heat Resources announces that mining company Xstrata Pachón is seeking to enter a 50 MW Power Purchase Agreement for its Copahue Geothermal Power Project in Argentina.

Reported from South America, the subsidiary of Xstrata Copper is looking at purchasing power for its mining operation in Argentina. Xstrata Pachón SA has – according to the news – submitted a letter of interest in negotiating a 50 MW electricity off-take contract with Australian Earth Heat Resources for its Copahue Geothermal Development Project in Argentina.

In a release by Earth Heat Resources, the initial allotment of approximately 50MWe with potential for further expansion in the future. Any agreement would be subject to satisfaction and waiver of certain conditions precedent, the parties may enter into a binding power purchase agreement (PPA) contingent on Xstrata Copper’s decision to advance development of the El Pachón Project
post receipt of the Environmental Impact Assessment Approval.

Parties will initiate a process aimed at developing a long term strategic relationship for the generation, supply and purchase of energy arising from and dedicated to their Argentinean projects.

The proposed agreement underscores the strong demand for power in Argentina – a market where EHR is extremely well positioned.

General Manager of Pachon, Xavier Ochoa “We are committed to finding the best environmental, social and economic solutions in support of our potential future investments in Argentina and look forward to working with Earth Heat in the first Geothermal Plant in the country”.

Earth Heat Managing Director Torey Marshall commented, “Both Earth Heat and Xstrata Copper share the view that a sustainable energy environment in Argentina can be supported by investment into high quality renewable energy projects, in particular Geothermal. We look forward to working towards a closer relationship as we jointly negotiate a Power Purchase Agreement. As a company, Earth Heat has created a market leading position in the space in Argentina and believe that further investment will be a key driver of sustainable energy production in the country”

Source: Law360, Earth Heat Resources release (pdf)