Ormat Industries Ltd. (TASE: ORMT) subsidiary Ormat Technologies Inc. (NYSE: ORA) should be awarded five exploration geothermal concessions the Committee on Geothermal Energy Analysis recommended to Chile's Minister of Energy. Ormat will own the licenses through its Chilean subsidiary, Ormat Andina SA.
The Geothermal Committee recommended awarding Ormat Andina all five of the concessions it bid for, as part of a tender for 20 new areas of geothermal energy exploration. The concessions are called "Aroma", "Quinohuen", "Marimar" "San Jose II", and "Sollipulli." Ormat is required to invest in an exploration program at the concessions over the next two years. Successful exploration results will be followed by an exploitation license, which is the first step for power plant construction.
Studies indicate Chile has a large untapped geothermal energy potential and is expected to lead geothermal development in the region.
Ormat CEO Yehudit Bronicki said, "To be awarded with five-out-of-five exploration concessions reinforces Ormat's position as a leader in the geothermal industry as well as demonstrates our experience as a vertically integrated technology provider with a strong commitment to the development of green-field geothermal projects throughout the world. While we know not all exploration sites result in commercial projects, we are happy to increase our potential development in Chile. These concessions add to Ormat's diverse portfolio of interests and developments in Latin America and worldwide, which include activities as owner and operator of power plants in Nicaragua, Guatemala, Kenya and the US."
Ormat Technologies' share price rose 1.8% in New York yesterday to $19.17, giving a market cap of $871 million, and Ormat's share rose 1.7% in early trading on the TASE today to NIS 23, giving a market cap of NIS 2.7 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on October 25, 2011
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