Adelaide, Nov 1, 2006 AEST (ABN Newswire) - The operating Beverley uranium mine in South Australia may take future electricity supplies from a geothermal or "hot rocks" source in South Australia.
Heathgate Resources Pty Limited - the operator of the Beverley mine in the Flinders Ranges north of Adelaide - and Petratherm Limited - a listed geothermal developer - announced today they have signed a Memorandum of Understanding (MoU).
The MoU aims to provide Petratherm and Heathgate Resources with a base from which to explore potential opportunities in relation to supplying the Beverley mine with additional electricity over and above its current contracted requirements.
This electricity would be produced by geothermal energy to help meet the mine's growing future needs.
"This MoU is an excellent first step towards the future possibility that South Australia could host the first operating uranium mine powered by a renewable energy source," Heathgate's Managing Director, Mr Patrick Mutz, said today.
"If this becomes a reality, it will mean an economically competitive supply of renewable electricity will be available for regional South Australia, where electricity is currently supplied by generators using carbon based non-renewable sources."
The electricity to be potentially supplied by Petratherm would be from its flagship Paralana geothermal energy project being developed just 11 kilometres from the Beverley uranium mine.
Heathgate's power requirements are expected to increase from the current 3 to 4 megawatts per year as its mining operations continue to develop.
As Heathgate's current supply contracts are fulfilled, the MoU also provides the flexibility for Petratherm to be considered for future supply opportunities, subject to meeting all strict operational, reliability, quality and security parameters.
"There are potential mutual benefits to our company and Heathgate in progressing the supply of the mine's electricity needs from nearby geothermal-sourced outputs," Petratherm's Managing Director, Mr Terry Kallis, said today.
"Our objective is to be able to supply Beverley with electricity at equal to, or lower in price than alternative sources including existing supply sources," Mr Kallis said.
"The MoU enables Heathgate and Petratherm to consider and negotiate a range of options - size and timing of plant - and contemplate the commercial agreements that might underpin those options to meet both companies' respective needs.
"It is particularly pleasing as the business plan behind Petratherm's initial float two years ago identified the emerging mining provinces of South Australia as potential foundation customers for geothermal-sourced electricity.
"Strategically, a Paralana-based geothermal power station could readily expand to match the growing needs of Beverley and other nearby developments."
In August, Petratherm confirmed that its Paralana-1 geothermal test well (now 1.8 kilometres deep) near Beverley had recorded one of the country's highest "hot rocks" temperatures.
That result paved the way for Petratherm to move to the next stage of the project - drilling two new wells nearby to Paralana-1 but up to twice the depth of the test well, to prove up the expected thermal resource, undertake circulation tests and establish an underground heat exchanger.
Under this trial heat exchange program, water would be pumped from surface down one of the new wells and circulated through hot rocks at approximately 3.6 kilometres depth. It would then be returned to surface via the second well as superheated water able to produce steam to drive electricity generators.
The drilling and circulation work would be a precursor to developing an electricity generation plant at Paralana of around 7.5 Megawatts capacity to supply local demand - including to potential key customers such as Heathgate or delivering into the State's main electricity grid infrastructure.
Contact
Kevin Skinner
Senior Consultant
FIELD PUBLIC RELATIONS
231 South Road
MILE END SA 5031
Tel: (08) 8234 9555
Fax: (08) 8234 9566
Mob: 0414 822 631
kevin@fieldpr.com.au
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