Origin Energy puts more cash into geothermal venture

Sydney, Australia-based Origin Energy announced today that it boosted its investment in a geothermal joint venture it owns with Milton, Australia's Geodynamics.

Origin made a further commitment of Aus$9.6 million in the Cooper Basin venture in South Australia, bringing Origin's total funding to Aus$150 million.

The new financing comes as a result of Geodynamics, the venture's operator, completing its stage one proof of concept phase on time and within budget.

"With this milestone achieved we can now move towards actually harnessing the energy contained in Australia's hot-rock resources," said Grant King, managing director of Origin Energy.

In addition to its 30 percent interest in the Cooper Basin geothermal venture, Origin also remains the largest shareholder of Geodynamics with a 7.5 percent stake. Origin made its initial investment in Geodynamics in August 2003, and invested in the joint venture late last year.

"Australia's natural geothermal resources are among the best in the world and we believe geothermal energy has a key role to play in meeting Australia's emissions reduction targets foreshadowed through an emission trading scheme, as well as the planned renewable energy targets," said King.

Earlier this month, a draft report from Australia's climate change adviser called for an Emissions Trading Scheme in the country (see Australian report pushes for carbon trading). The government plans to issue an outline of the scheme later this month.

Geodynamics has currently drilled three wells, with the completion of the proof of concept phase including a 1 megawatt pilot plant to power the joint venture operations and the local township of Innamincka.

The venture plans to build a 50 MW demonstration plant and drill a further nine wells, with the work expected to be completed in late 2011. Another nine plants will be built to produce an overall capacity of 500 MW, estimated to be complete in late 2015.