U.S. Geothermal acquires US development assets through merger

U.S. Geothermal Inc. announced this week that it has signed an Agreement and Plan of Merger  to acquire Earth Power Resources (“EPR”). Under the terms of the Agreement, EPR will be merged with and into U.S. Geothermal. EPR shareholders will receive a total of six hundred ninety-two thousand seven hundred sixty-nine (692,769) shares of U.S. Geothermal stock in exchange for all outstanding shares of EPR stock. EPR will have no outstanding debts or unpaid obligations at the time the transaction closes. The transaction is expected to close by the end November 2014 following shareholder approval by EPR Shareholders.

The assets acquired from EPR include geothermal leases covering 26,017 acres in Nevada representing three projects, as well as EPR’s complete geothermal resource database of new project opportunities located throughout the western United States. EPR’s management evaluated and compiled the database over its nearly 40 years of geothermal exploration experience.

Resource reports prepared for EPR over the past several years by GeothermEx Inc., a consulting geothermal engineering firm, provide estimates that the energy potential contained within the three projects is in the range of 158 to 359 megawatts.

The megawatt estimates contained in these independent reports represent the potential energy, or heat-in-place contained within the project boundary, which demonstrates that these prospects are very attractive development targets with identified geothermal resources. The actual, producible power generation may be significantly different than the heat-in-place calculations, and will depend upon the discovery of commercial temperatures and permeability.

In parallel with the closing of the EPR transaction, U.S. Geothermal has acquired an additional 2,960 acres of private geothermal lease rights necessary to fully develop the Crescent Valley resource.

“We are very pleased to add the Earth Power development resources to our development project portfolio,” said Dennis Gilles, Chief Executive Officer of U.S. Geothermal Inc. “Earth Power Resources, under the leadership of Ronald Barr, has had tremendous success with the early stage development of numerous projects over the past 4 decades, that went on to be successfully developed geothermal projects in operation today. We are pleased to take over the reins from Ron and advance these excellent opportunities to their final stage of development. We are also pleased to have Ron working with our team over this next year, as we move these projects forward. We had previously announced that our plan for continued growth would come through a combination of the development of internal projects and growth through strategic acquisition – this acquisition continues the execution of that plan.”

Source: Company announcement via Yahoo