EDC eyes interest in Chile project
MANILA, Philippines—Energy Development Corp., the country’s biggest producer of geothermal energy, is acquiring a 70-percent stake in a geothermal concession in Chile, which is currently owned by Canada-based Alterra Power Corp.
In a briefing last Friday, EDC president Richard B. Tantoco disclosed that the company was firming up a joint-venture agreement, which it hoped would be signed by EDC and Alterra Power in three months’ time.
According to Tantoco, EDC planned to use the same farm-in arrangement as what it did with Australian firm Hot Rock Ltd. Under this arrangement, the Lopez firm was able to acquire a 70-percent stake in four of Hot Rock’s geothermal concession areas in Chile and Peru.
“We will farm in with our investments. But it’s a no-premium deal, which means that we’re not paying them a premium or upfront cost. We will just pump in cash in the company as needed. [Alterra Power] got the Mariposa concession, drilled some shallow wells and constructed roads and now EDC will be coming in to do the deep drilling activities,” Tantoco explained.
In October last year, EDC already signified its interest in Alterra Power’s geothermal concession in Chile and five of Alterra’s geothermal authorizations in Peru.
The previous agreement signed last year between the two parties gave EDC the “exclusive right to conduct exploration and due diligence and the sole option to advance the projects to joint venture stage.” EDC is expected to invest in equity if the due diligence yielded favorable results.
EDC is racing against other foreign companies to build the first geothermal power plant in Chile as it aggressively pursues efforts to boost its operations globally.
EDC also owns three other geothermal exploration concession areas in Chile, namely Newen, San Rafael and Batea and is planning to pursue other prospective geothermal concession areas in that country.
EDC, which is acknowledged as a global leader in wet steam technology, is engaged in the exploration, development and optimization of geothermal fields as well as the operation and maintenance of geothermal power plants in the Philippines with an installed capacity of 1,130 megawatts.