US Geothermal starts drilling for second phase of San Emidio project

US Geothermal starts drilling for second phase of San Emidio project San Emidio power plant in Nevada, U.S. (Source: U.S. Geothermal)
Alexander Richter 4 Sep 2013

U.S. Geothermal reports it has started drilling as part of 11 MW Phase 2 extension at the company's San Emidio project in Nevada.

As part of its extension plans for the San Emidio geothermal project in Nevada, developer U.S. Geothermal Inc. (TSX:GTH) announced today that drilling has started for the Phase II Project.

The company is planning to develop the San Emidio project in two phases: a repower (Phase I) and an expansion (Phase II). Phase I was completed in May of 2012, when the existing 3.6 MW plant was replaced with a new, more efficient 9 MW power plant that utilizes the existing geothermal fluid flow from the proven area of the reservoir. Phase II requires drilling new production and injection wells, and upgrading transmission to support the increased power production. The Phase II expansion may produce up to 11 MW (net) to fill the full available output allowed under the existing PPA with NV Energy. Pending a successful drilling program, the Phase II power plant is anticipated to be online in 2015.

The first well to be drilled for Phase II is located approximately 2 miles north of the operating San Emidio Phase I power plant and is planned for a depth of up to 3,000 feet. The targeted area was first identified by three water supply wells drilled for a mining operation in the 1990s, which discovered a shallow, hot outflow zone from 300 to 500 feet deep with temperatures of 220 to 240degF.

As part of the continuing DOE innovative exploration program, detailed geologic mapping of the surface features, combined with a satellite survey and five seismic lines were run through the target area. These efforts identified significant fault structures and provided targeting information for the drilling program. Seven wells have been permitted in the Phase II project area. Under the DOE program, there is $991,000 of grant funds remaining that are committed to the second phase of cost shared drilling.”

“We are excited to initiate drilling for this second project in the San Emidio resource area,” said Doug Glaspey, President and COO. “Moving the project forward this year will qualify Phase II for the currently available 30% Investment Tax Credit, and will take full advantage of the remaining balance in the 19.9 megawatt PPA we have in place with NV Energy.”

Source: Company release via Wall Street Journal