President and COO of HTM, Doug Glaspey, could not contain his enthusiasm over the preliminary results from this first production well at El Ceibillo, which is located just over 6.5 miles southwest of Guatemala City, with some 24.7k acres of prime territory smack in the middle of the Aqua/Pacaya twin volcano complex. The final depth was a good 1.5k feet deeper than initially planned on the EC-1, due in large part to exceptional drilling conditions and geology, which allowed the company to chase the hotter depth and still manage to pull it all off within budget.
We are talking a bottom-hole temp of 491 degrees Fahrenheit (255 Celsius) with a gradient ramp around 7.1DegF/100 feet. Taken in light of the 392DegF and greater encountered as early as approximately 2.6k feet down the hole, we are looking at a 2.2k-foot high-temp reservoir interval. These are superb numbers and they spell a bright future for the optimally-located El Ceibillo, just outside the energy-hungry capital, whose population is now upwards of 1.075M.
The company ran into some permeability on the way down and ended up running a slotted liner to support production operations, with the subsequent cleanout showing really strong indicators that a formal testing was in order. HTM is now looking at a 4 to 6 week window within which to execute further testing and they are currently focused squarely on getting the necessary flow test hardware fabricated and in place.
The goal to complete a 25-megawatt flash steam power plant is one step closer with today’s news, and the potential of the concession as a whole is immense, with a projected 50MW capacity easily achievable, out beyond the 15-year term PPA framework figure of 25MW, established by the MOU signed back in October of 2012. Glaspey is obviously pleased with the reservoir temps, which are considerably higher than initially anticipated and the optimal downhole geology, combined with the favorable external logistics looks very good for HTM shareholders.
Given that the drilling conditions are demonstrably good enough to bring down projected costs of future production drilling, HTM is in the pole position here, with easy drilling ahead into some seriously hot ground. Premium economics and a massive consumer market right nearby spells big potential for the company’s Guatemala operations and investors will be eager to hear further reports as the test flow equipment is readied, then implemented at El Ceibillo in the coming weeks.
HTM has a total acreage position of some 69.5k acres across all six of their advanced stage projects and is a great way to get into the geothermal game.
For more information on U.S. Geothermal, visit www.USGeothermal.com
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