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Sep 24, 2009Magma believes current prices in Chile are suitable for geothermal development
Current prices suitable for geothermal development - Magma - Chile
Wednesday, September 23, 2009 15:58 (GMT -0400)
Canadian geothermal company Magma Energy believes power prices are sufficient in Chile to make development of the renewable source financially attractive, according to the company’s chief geologist Catherine Hickson.
“We do believe that power prices are high enough to make development profitable. Based on the work that we did putting our development proposal together, we feel there will be adequate return on investment,” Hickson said.
“Chile is a great place for a company such as ours, and we feel that there is a lot of power need that is not being adequately addressed,” she said.
As Chile continues to expand renewable capacity, geothermal power is not only a sound investment but has also been proven to have a minimal environmental impact.
“The environmental concern in Chile around large-scale hydro projects, for example, makes geothermal a great option. The geothermal footprint is extremely low because of the small plant size and very small fields. You can even have co-use of the area, for grazing, for example,” Hickson said.
“The plant size is on the order of a few hectares,” she added. “And of course, there are virtually no emissions.”
Magma is currently waiting on approval of an exploitation license for its Laguna del Maule concession in Chile’s central-south region VI. Once approval is obtained, the company expects a plant to go online within five years.
But the current concession system has proved burdensome for geothermal companies seeking operations in the country.
“There is concern in Chile that the government is not moving forward expeditiously in the granting of exploration and exploitation concessions,” she said.
“One of the problems is the board that reviews the bids,” Hickson continued. “I suspect that they are somewhat overwhelmed with the technical reviews. The government needs to state that geothermal power is a priority and act accordingly.”
Magma’s portfolio includes properties in Argentina, Nicaragua and Peru in addition to Chile.
The complete interview with Hickson will be published in this week’s Electric Power Perspectives, for subscribers only.
By Christopher Lenton
Business News Americas
CanGEA urges the Canadian government to act more favourably towards geothermal energy. Our government may want to think about making geothermal power more attractive so that Canadian companies can work at home as well as abroad. Geothermal energy is a worthwhile investment, one that the government should be hopping on. While we wait for the government to act, Canadians are missing out on having clean, renewable energy that would offset a large portion of our carbon emissions.
