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Nevada Geothermal Power Inc. (NGP) owns a 100% interest in the Blue Mountain geothermal project located in Humboldt County, Northern Nevada. The property covers 10,984 acres (17.2 square miles), located 20 miles from the state electrical transmission grid.
In 2006, NGP signed a 20-year Power Purchase Agreement for up to 35 MW of geothermal power at Blue Mountain with Nevada Power Company. The geothermal power plant at Blue Mountain, "Faulkner I" is the first phase of development at Blue Mountain and is advancing towards construction and completion by the end of 2009. To ensure that the long lead-time components of the power plant, NGP has issued a limited notice to proceed to Ormat Technologies Inc. (NYSE: ORA) under a fixed-price, date-certain engineering, procurement and construction (EPC) contract to supply and construct the Phase 1 power plant at Blue Mountain. Construction is expected to commence in the second quarter of 2008. The finalized EPC is expected to be signed by the end of April, 2008.
Blue Mountain Faulkner I (phase 1) geothermal project is on the road to revenue, recent highlights are:
- 20-year power purchase agreement (PPA) with Nevada Power Company for up to 35 MW (gross)
- Large generation interconnection (LGIA) for up to 75 MW approved
- Environmental assessment approved (FONSI)
- USS$140 million project financing expected to close May 2008
- Well field development ongoing
- Ormat Technologies Inc, fixed price, guaranteed completion of power plant
- Construction expected to commence end of June 2008
- TURN ON THE POWER: 4th quarter of 2009.
To date, NGP has completed five production wells and expects to drill 1-2 more production wells and four injection wells in 2008. Drilling results are positive and the wells have in most cases have exceeded expectation of NGP's estimates of MW productivity.
- Back in 2002, a deep test well, Deep Blue No 1 drilled down to 672 metres confirmed the discovery of a massive pool of heated water that has the potential to develop an initial 30MW (megawatt) electrical plant.
- 2002, 2003 - Blue Mountain geothermal project has received grants from the U.S. Department of Energy to the tune of US $1.25 million, for cost share drilling (DOE 80%-NGP 20%).
- In 2004, NGP completed drilling a second deep well, Deep Blue No. 2 to delineate the resource and confirm the strength of the system.
- Drilled to a depth of 1,128 metres, the hole yielded a maximum temperature of 167°C (new base temperature for the reservoir) at 585 metres confirming the presence of a high-temperature, shallow geothermal resource.
- Eight temperature gradient holes drilled in 2004 nearly doubled the known geothermal anomaly and are open to further expansion.
- Summer 2006 heralded as a major geothermal reservoir discovery with the completion production test well 26A-14.
- Fall 2007 third production well is a prolific producer.
- Fifth production well completed, to be flow tested in April, 2008
- Drilling of first injection well underway.
Expansion at Blue Mountain is likely for Phase 2 development.
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