Monday, January 15, 2007 8:29:14 PM
Progress Report at Blue Mountain Geothermal Site
VANCOUVER, BC (January 15, 2007) – Nevada Geothermal Power Inc. (NGP) (TSX-V: NGP, OTCBB: NGLPF) announces a progress update on the development at the Blue Mountain Geothermal site.
Blue Mountain Resource - Development Drilling Update
Well 38-14 has been drilled to 2006 feet with 13 7/8 inch production casing cemented in place. Drilling has been temporarily suspended with the hole at 2006 feet due to a major equipment breakdown that occurred on December 5th. The mechanical difficulty had been that the draw works motor seized and on December 9th the second motor that had been installed ran for less than 1 minute before it seized leaving the drill pipe suspended in the hole. The pipe was recovered on December 31, 2006 and the pipe laid down and the rig was subsequently released.
A replacement geothermal rig has been identified and is expected to be on site mid-February. The new contractor is reputable and very well known, with over twenty years of experience in the completion of geothermal production wells in Nevada. Well 38-14 is anticipated to be drilled to approximately 3500 feet and is expected to yield similar results to Well 28A-14. As per the news release on (October 18, 2006), Well 28A-14 encountered a “prolific” production zone between 2215 feet and hole bottom at 2815 feet.
Drilling problems at Well 38-14 have been resolved without any impact on the overall development schedule. This means that the Faulkner 1 Geothermal Power Plant at Blue Mountain will still be brought on line in 2009.
There has been considerable progress in the development of the Blue Mountain “Faulkner 1” power project:
The Company’s initial development well 26A-14 has a gross power capacity of 9.6 MW (enough to supply power to 7,000-10,000 homes). Furthermore, the 365 F°(185°C) temperature and the energy content of produced fluids per unit of volume was higher than anticipated at the depth encountered. New chemistry of representative geothermal waters from 26A-14 predicts source temperatures of 225-235°C (Thermochem Laboratory and Consulting Services Report, December18, 2006). Drilling and geothermometry results indicate that the Blue Mountain reservoir may be capable of supporting a flash-type geothermal plant which would result in lower capital and operating costs.
A 20-year Power Purchase Agreement (“PPA”) was completed in July 2006. According to this Agreement, Nevada Geothermal Power Company, NGP’s U.S. subsidiary will provide Nevada Power Company, a Nevada utility, with up to 35 MW (gross) 31.25 MW (net) of geothermal power and associated Renewable Energy Credits (RECs). In October 2006, Nevada Power Company filed the NGP PPA along with others as an amendment to its Resource Plan and submitted them to the Nevada Public Utilities Commission of Nevada (“NPUC”) for approval. NPUC approval of the power contract is anticipated early 2007.
Project Infrastructure
· System Impact Studies for the electrical grid connection of the Faulkner 1 Power Development Project have been completed. Additionally, a location north of Mill City, Nevada was approved for the Blue Mountain power line to connect with the SPPCo #162 (120 kV) transmission line in September 2006. Separately, a Facilities Study will be completed by February, 2007.
In November 2006 an initial Utility Environment Protection Act (UEPA) permit application was submitted to the Public Utility Commission. In addition, work has commenced on all of the other major permits required by the project.
NGP met with the Humboldt and Pershing County Commissions in November 2006 and also held public forums to discuss the Blue Mountain Faulkner 1 Power Development and the transmission line project. The commissioners of both Humboldt and Pershing and other public authorities have expressed their support for the Blue Mountain project.
About Nevada Geothermal Power Inc.
Nevada Geothermal Power Inc. is a renewable energy company exploring and developing geothermal projects in the United States to provide electrical energy that is clean, efficient and sustainable. NGP is committed to the geothermal industry and currently owns a 100% leasehold interest in the Blue Mountain, Pumpernickel, Black Warrior projects in Nevada and the Crump Geyser Project in southern Oregon.
VANCOUVER, BC (January 15, 2007) – Nevada Geothermal Power Inc. (NGP) (TSX-V: NGP, OTCBB: NGLPF) announces a progress update on the development at the Blue Mountain Geothermal site.
Blue Mountain Resource - Development Drilling Update
Well 38-14 has been drilled to 2006 feet with 13 7/8 inch production casing cemented in place. Drilling has been temporarily suspended with the hole at 2006 feet due to a major equipment breakdown that occurred on December 5th. The mechanical difficulty had been that the draw works motor seized and on December 9th the second motor that had been installed ran for less than 1 minute before it seized leaving the drill pipe suspended in the hole. The pipe was recovered on December 31, 2006 and the pipe laid down and the rig was subsequently released.
A replacement geothermal rig has been identified and is expected to be on site mid-February. The new contractor is reputable and very well known, with over twenty years of experience in the completion of geothermal production wells in Nevada. Well 38-14 is anticipated to be drilled to approximately 3500 feet and is expected to yield similar results to Well 28A-14. As per the news release on (October 18, 2006), Well 28A-14 encountered a “prolific” production zone between 2215 feet and hole bottom at 2815 feet.
Drilling problems at Well 38-14 have been resolved without any impact on the overall development schedule. This means that the Faulkner 1 Geothermal Power Plant at Blue Mountain will still be brought on line in 2009.
There has been considerable progress in the development of the Blue Mountain “Faulkner 1” power project:
The Company’s initial development well 26A-14 has a gross power capacity of 9.6 MW (enough to supply power to 7,000-10,000 homes). Furthermore, the 365 F°(185°C) temperature and the energy content of produced fluids per unit of volume was higher than anticipated at the depth encountered. New chemistry of representative geothermal waters from 26A-14 predicts source temperatures of 225-235°C (Thermochem Laboratory and Consulting Services Report, December18, 2006). Drilling and geothermometry results indicate that the Blue Mountain reservoir may be capable of supporting a flash-type geothermal plant which would result in lower capital and operating costs.
A 20-year Power Purchase Agreement (“PPA”) was completed in July 2006. According to this Agreement, Nevada Geothermal Power Company, NGP’s U.S. subsidiary will provide Nevada Power Company, a Nevada utility, with up to 35 MW (gross) 31.25 MW (net) of geothermal power and associated Renewable Energy Credits (RECs). In October 2006, Nevada Power Company filed the NGP PPA along with others as an amendment to its Resource Plan and submitted them to the Nevada Public Utilities Commission of Nevada (“NPUC”) for approval. NPUC approval of the power contract is anticipated early 2007.
Project Infrastructure
· System Impact Studies for the electrical grid connection of the Faulkner 1 Power Development Project have been completed. Additionally, a location north of Mill City, Nevada was approved for the Blue Mountain power line to connect with the SPPCo #162 (120 kV) transmission line in September 2006. Separately, a Facilities Study will be completed by February, 2007.
In November 2006 an initial Utility Environment Protection Act (UEPA) permit application was submitted to the Public Utility Commission. In addition, work has commenced on all of the other major permits required by the project.
NGP met with the Humboldt and Pershing County Commissions in November 2006 and also held public forums to discuss the Blue Mountain Faulkner 1 Power Development and the transmission line project. The commissioners of both Humboldt and Pershing and other public authorities have expressed their support for the Blue Mountain project.
About Nevada Geothermal Power Inc.
Nevada Geothermal Power Inc. is a renewable energy company exploring and developing geothermal projects in the United States to provide electrical energy that is clean, efficient and sustainable. NGP is committed to the geothermal industry and currently owns a 100% leasehold interest in the Blue Mountain, Pumpernickel, Black Warrior projects in Nevada and the Crump Geyser Project in southern Oregon.
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