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investment in geothermal

The emerging Australian geothermal industry is increasingly providing potentially attractive opportunities for investment in the development of large scale baseload renewable power generation projects.

Interest and investment in renewable energy production including geothermal energy is experiencing rapid growth due primarily to developing countries striving to achieve energy independence and more developed countries exploring options for preventing global warming by reducing greenhouse gas emissions.

Approximately 70 companies hold equity in geothermal exploration projects across Australia, with the majority of interest focussed on the 9 ASX-listed geothermal pure-play’s (solely focused on geothermal) and the 8 ASX-listed energy companies with strategic investments in the sector.

 

Australian Geothermal Index Performance

Following sharp falls in global equity markets during late-2008, the value of the Australian Geothermal Index collapsed to the extent that the AGI was trading at under 50 during November 2008. Less than the AGI’s value only 6-months prior.

In recent months the performance of the AGI has closely followed the positive lead by both the Australian market and global equity markets, by posting improvements in the order of 30% since recent lows.

Many of the private geothermal exploration companies which have aspirations for a public listing are watching equity markets closely. The private geothermal companies aim to develop extensive project portfolios and capture sufficient value by identifying attractive geothermal resources, before participating in corporate activity or opting for a primary listing on the Australian Securities Exchange.

 

Geothermal Global INvestment 2004 - 2009 US$ BILLIONS

Source: Compiled by Activated Logic from New Energy Finance statistics

 

financing geothermal projects

Financing for Geothermal project development has always depended strongly on equity investments, mostly because of the risk structure and time frame of geothermal project development. The resource element and the “drilling risk” also demands investors that understand the challenges in the development process. Traditionally, debt financing was only available when the developer was able to prove the resource through successful drilling results.

Please see our Global Geothermal Alliance for more information on financing Geothermal Projects.

 

How can Activated Logic Help?

  • Assistance with geothermal project investment through a network of experienced strategic partners, attendance at geothermal and renewable energy events, and the coordination of priority investor briefings including the preparation of company roadshow style events.

  • Geothermal project evaluation through comprehensive due-diligence, in-depth feasibility analysis including use of Activated Logic’s Sequential Investments Assessment Matrix (al-SIAM) to determine the attractiveness of geothermal project investment or  other forms of corporate transactions including M&A

  • Manage geothermal grant applications under the Australian Geothermal Drilling Program (GDP) and the Renewable Energy Demonstration Program (REDP). Activated Logic also can provide assistance with international grant schemes including those available through the International Finance Corporation (IFC) division of the World Bank Group.

  • Preparation and presentation of technical communications including investment proposals and information memorandums with the objective of raising capital or forming alliances with industry participants to develop geothermal projects.

  • Geothermal project development & management - from early stage project initiation through to pre-feasibility, resource definition, FEED, project sanction and all commercial development stages

  • Develop integrated and effective strategies (including geothermal  power plant technology selection) to accelerate the commercialisation of attractive geothermal projects and maximise likelihood of sustained success of geothermal projects.

  • Government policy – Activated Logic provides research, interpretation and advisory services in relation to the actual and expected implications of current and future government policies in relation to geothermal exploration and development.

  • Effective project and company communications for internal and external stakeholders demonstrating key-benefits. Full suite of graphic services provided to ensure technical communications including seismic-sections, gravity surveys and other geological data is presented professionally.

For more information on how Activated Logic can assist your organisation create and extract value from your geothermal portfolio, please contact us.


Other geothermal Sectors:

 

Industry Membership

Activated Logic Pty Limited is a Member of the Australian Geothermal Energy Group. As a member of the AGEG, Activated Logic has a common interest in sharing information to commercialise Australia’s geothermal resources at maximum pace and minimum cost in Australia’s competitive energy markets.

 

 

 



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