Lopez energy firm readies expansion overseas
Energy Development Corp. (EDC), the country’s biggest producer of geothermal energy, is set to expand globally as it expects to be awarded within the year geothermal concession areas offered earlier by the Chilean government.
“Overseas, we have applied for 13 concession areas and submitted bids for five other concession areas in Chile. We expect positive news on some of these in 2011,” EDC president Richard B. Tantoco said in a recent briefing.
The development of the potential concession areas, however, might take as long as six years to complete—from the testing, exploration and drilling activities as well as the actual construction of the geothermal power facilities in Chile.
“Fortunately, in the next five to six years, we expect a lot of growth in the local business, but by 2015 to 2016, that’s when we want our international business to take off—when the domestic growth slows down,” Tantoco explained.
Tantoco declined to disclose the amount of investments that could be involved in the prospective Chile projects but noted that EDC might have to pour in as much as $4 million to produce a megawatt of geothermal power.
“It’s too early to tell. We don’t know yet if we can find a mega-site like the one in Leyte. If we find a 700-megawatt site at $4 million a MW, then that’s about $2.8 billion. But if we find a 50-MW site, that will be about $200 million. So it’s hard to say for now,” Tantoco explained.
Still, EDC is confident of finding prospective resource sites in the areas it had bid for as Tantoco described these as “promising” given that Chile has “10 times our volcanism.”
In preparation for the planned geothermal operations in Chile, EDC has put up EDC Chile Ltd., a limited liability company incorporated in Santiago, Chile, with the purpose of exploring, evaluating and extracting mineral or substance to generate geothermal energy.
Meanwhile, for its planned foray in Indonesia, Tantoco admitted that progress had been slower due to a different nature of conducting business there. He explained that in Indonesia, a lot of the geothermal concession areas already have owners and as such, EDC had to get into joint ventures with these contract holders.
The company, Tantoco added, was also trying to apply for its own greenfield concession areas through a team it has established in Indonesia years ago.
