U.S. Geothermal Inc. recently acquired the majority of Goldman Sachs’ cash flow interest in and ownership of the Raft River geothermal project in Idaho for $51 million.
The company said it will receive 95 percent of the cash flow from the project on a going forward basis, along with all increased cash flow from any project improvements.
According to U.S. Geothermal, the deal includes an option to purchase the balance of Goldman’s interest for fair market value at the end of 2017.
“This agreement with Goldman Sachs is a strong positive for our company,” Dennis Gilles, CEO of U.S. Geothermal, said on Dec. 15, 2015. “It unlocks the ability to consider capital upgrades that should increase output from the facility and potentially reach its design capacity of 13 MW.”
The Raft River project, which is located in southeast Idaho, has a designed capacity of 13 MW net, but is currently operating at approximately 9.4 MW, the company said, adding that power from the facility is sold under a firm price, 25-year contract with Idaho Power Company
U.S. Geothermal also said that reservoir modeling indicates that the geothermal reservoir can support the full 13 MW plant capacity, and plans are under consideration to drill for additional production to increase plant output.
“We are encouraged by the increasing focus on climate change and renewable energy” Gilles said. “Geothermal is 24/7 baseload power and has significant advantages over wind and solar. We are seeing legislators paying closer attention to reducing emissions and expect a ready market for our pipeline of development projects as we bring them on stream.”
Stock Refocus
U.S. Geothermal at the end of 2015 officially de-listed its securities from the Toronto Stock Exchange, according to a Dec. 10, 2015, statement.
The company said the decision was driven by limited trading volume of shared on the TSX over a sustained period, with more than 97 percent of trades in its securities over the last two years occurring on NYSE.
U.S. Geothermal shares will continue to trade under its existing stock symbol HTM on NYSE.
Lead image: Legal document. Credit: Shutterstock.
