Maibarara prepares to spend $10M for 2 wells
Maibarara Geothermal Inc., which is developing a P2.8-billion geothermal power plant near Mt. Makiling, plans to spend roughly $10 million to drill two new wells to determine if it could increase the plant’s capacity from the initial estimate of 20 megawatts.
Energy Undersecretary Jose M. Layug Jr. said that the two wells, which may cost between $4 million and $5 million each, are likely to be drilled next year to determine the potential additional capacity.
Layug added that MGI—which broke ground at the geothermal site last week—had been granted a “declaration of commerciality” by the Department of Energy.
The declaration confirms that the resources are available and that the power plant project is commercially feasible, thus enabling the DoE to allow MGI to build its proposed geothermal power generation facility, Layug explained.
“[The geothermal power facility of MGI] is the first project under the Renewable Energy Act that went into declaration of commerciality, although there are a few others that will soon go into declaration as well,” Layug said.
MGI, a joint venture among PetroEnergy Resources Corp., Trans-Asia Oil and Energy Development Corp. and PNOC Renewables Corp., is expected to start producing 20 MW from its geothermal facility by late 2013.
The capacity is expected to be purchased by Trans-Asia Oil over the next 20 years as provided by the electricity sales agreement signed last year.
Layug commended the project, saying that it is likely to become the first geothermal power plant to be installed since 2006.
The project is also being put up by an entirely Filipino joint venture.
The energy official was optimistic that this development will boost the interest of local and foreign companies in investing in the country’s renewable energy sector.
Recently, MGI signed a land lease agreement with state-run National Power Corp. (Napocor) and Power Sector Assets and Liabilities Management (PSALM) Corp. for two lots in Sto. Tomas, Batangas.
These lots, which are titled under Napocor’s name, will be used in the steamfield operations of the Maibarara geothermal power project.
According to MGI, the agreement will give the company the exclusive access and rights to conduct geothermal operations within the covered areas.
The land lease agreement is valid for 25 years and can be extended by another 25 years, subject to the mutual agreement of involved parties.
