Alterra Power Corp. (TSX: AXY) has entered into an agreement with Energy Development Corp. (EDC), a Philippines-based geothermal company, for the development of Alterra's Mariposa geothermal project in Chile and five of Alterra's Peruvian geothermal concessions.
Under this agreement, EDC will have six months to carry out field work and due diligence on the South American projects in order to elect to advance them into a formal joint venture. If advanced, EDC will be entitled to earn a 70 percent interest by funding the next $58.3 million in project expenditures at Mariposa, and $8 million in project expenditures on the five Peruvian concessions. Subsequent project equity contributions and all economic sharing will be pro rata between the partners.
The Mariposa geothermal power project is in the Andes mountains of Chile and lies approximately 300 km (186.4 miles) south of Santiago. It is comprised of the Laguna del Maule and Pellado concessions, which completely encompass a geothermal system that has an inferred estimate of 320 MW. Alterra has conducted extensive exploration and infrastructural work at Mariposa, including three slim-hole wells and a 26 km (16.2 miles) access road.
Alterra's early-stage geothermal projects in the southern volcanic belt of Peru include the Loriscota, Crucero and Panejo concessions in the northeastern trend, and the Sara Sara and Tutupaca Norte concessions in the southwestern trend. Initial indications and Alterra's exploration activities to date have supported the potential presence of large geothermal resources.
Read more Latin America news