Petratherm secures Chinese geothermal rights Email Print Normal font Large font Vanessa Burrow November 2, 2006
Advertisement AdvertisementPETRATHERM has won the right to explore for suitable geothermal power sites in China.
Petratherm managing director Terry Kallis said that over the next nine months the company would investigate six or seven "hot-rock" sites in the Tibetan region, and in north-east, south-east and central China, and isolate three or four locations for development.
The company has received approval from the Asia Pacific Partnership on Climate and Clean Development, and is the only geothermal energy company to have approval. "There's a lot of geothermal potential in China," Mr Kallis said.
News of the approval sent Petratherm's shares up more than 27 per cent, to close at 37¢.
The announcement of the Chinese deal followed earlier news that the geothermal energy explorer had signed an accord to sell hot-rock electricity to Heathgate Resources' Beverley uranium mine in South Australia.
Both developments, which involve generating electricity by running water over heated granite deep underground, kept the shares near their intraday high of 39¢.
On April 13 they were trading at a year low of 25¢.
Any drilling in China would have to be undertaken with a local company as the majority stakeholder, and at least one other partner.
Mr Kallis said exploration in China would cost between tens of thousands and hundreds of thousands of dollars. "It's a matter now of starting to deliver," he said.
Petratherm has not yet completed its Paralana geothermal energy project in South Australia, where it is drilling two wells about 3.6 kilometres deep.
The company intends to circulate water through hot rocks, creating steam to drive electricity turbines in a 7.5-megawatt power station. Mr Kallis said this could offer Heathgate Resources an affordable alternative to coal-generated electricity, with a cost of between $55 and $65 for each megawatt-hour of geothermal hot-rock power.
"We have an off-grid market in the Beverley uranium mine in closer proximity than anyone else has," he said. "It brings us very close to our market. We believe we can sell at a price capable of making us economically viable."
Research shows geothermal hot rocks do cool down after several years, but they replenish themselves within a relatively short time.
PTR Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
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