Green Rock Energy signs $7 million Geothermal Drilling Program Funding Agreement with the Commonwealth Government.
Highlights
Green Rock has taken a major step towards funding its project to prove the concept of the direct use of geothermal energy in the Perth metropolitan area
Under the Funding Agreement, the Company is required to secure further funding from other parties which is expected by November 2010
Receipt of further funding would allow the first well to be drilled within the first half of 2011
Green Rock Energy is pleased to announce that a wholly owned subsidiary of the Company has signed a Funding Agreement with the Commonwealth Government for $7 million under the Geothermal Drilling Program. Signing the Funding Agreement allows Green Rock to start drawing down the funds for the project when it is ready to do so.
Managing Director Richard Beresford said This is a significant step towards funding our proposed project at The University of Western Australias Crawley Campus where we plan to drill two wells and test the system water flow to prove that commercial quantities of geothermal energy can be delivered from depths of about 3,000 metres. We expect temperatures from these depths to be sufficient to drive an absorption chiller which would supply a significant part of the Campus chilled water requirements, with substantial reductions in electricity demand. We hope to complete our project funding from other sources. The first source is from the WA Governments Low Emissions
Energy Development Fund to which we applied in March 2010. This is a competitive process and Green Rock is by no means certain that its application will be successful, but an announcement by the WA Government is expected shortly. The second source is from potential joint venture partners in the project and probably also in Geothermal Exploration Permit GEP1 which covers the project and 143km2 of the Perth metropolitan area. We are in discussions with potential joint venture partners. However if we are successful we expect it will take several weeks to secure any commitment.
Under the Funding Agreement, the Company is required to secure further funding from other parties, which is expected by November 2010. Receipt of further funding would allow the first well to be drilled within the first half of 2011.
Richard Beresford added I would like to pay compliments to the Commonwealth Government staff administering the Geothermal Drilling Program with whom we were able to agree pragmatic conditions for the funding that reflect the current state of the capital market and its limited appetite for geothermal subsurface risk.
Nigel Hodder Company Secretary Investors and Media T: +61 (0) 9482 0482 E: [email protected]
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