PACIFIC ISLAND REGIONAL GEOTHERMAL ASSESSMENT AND DEVELOPMENT INITIATIVE

A FUNDING PROPOSAL

SOPAC Miscellaneous Report - MR463

Sponsored by the

South Pacific Applied Geoscience Commission

June 2002

PACIFIC ISLAND REGIONAL GEOTHERMAL ASSESSMENT AND DEVELOPMENT INITIATIVE

A FUNDING PROPOSAL
EXECUTIVE SUMMARY This document is intended for use by potential providers of funding for a Pacific Island Regional Geothermal Assessment and Development Initiative, hereafter referred to as PIRGADI. It includes descriptions of the sponsoring and operating entities, introductory material concerning the nature of geothermal resources in general and in the SOPAC region specifically; rationales for the exploration and development of geothermal resources; descriptions of the power generation and geothermal situations in five selected SOPAC region countries; plans for conduct of PIRGADI activities in each country; the benefits of such work; and a budget and a program/work schedule. The sponsor of PIRGADI is the South Pacific Applied Geoscience Commission (SOPAC), an independent, inter-governmental organization established in 1972 for the purpose of improving the well being of its 18 member countries through the application of geoscience to the management and sustainable development of their natural resources. U.S. Geothermal Industries Corporation (USGIC) has agreed to use its expertise to complement that of the SOPAC staff so as to expedite exploitation of geothermal resources in the SOPAC region. USGIC is a consortium of 16 American firms, established in 1990 to collaboratively participate in the development of international geothermal projects. USGIC shareholding companies have the capabilities to undertake all activities related to such development. Four major reasons to undertake the PIRGADI are to: Follow up on the encouraging results of a 1995 regional geothermal survey; Develop indigenous geothermal energy resources sooner rather than later; Help the economies of the geothermally-rich countries by reducing their reliance on expensive imported fossil fuels; Increase local employment and develop human resources through training; and Optimize use of environmentally benign renewable geothermal resources as fuel. Specifically, some of the advantages to the use of geothermal resources are that: Fuel purchases are never needed for geothermal power plants; There is long term (30 year+) potential for utilization of the renewable energy resource; Geothermal plants have exceptionally high availability; The operating and maintenance costs of geothermal plants are low; Geothermal power project sizing can be flexible; Geothermal power projects can also be sources of fluids for direct geothermal use; Geothermal power plants emit minimal atmospheric pollutants; Very little land area is required by geothermal power projects; Geothermal power projects can be built in modules to allow for expansion; and Geothermal power plants have few environmental impacts. The earths crust comprises many plates that are constantly in motion. The interactions of plates results in the creation of volcanoes and fracture zones along the plate boundaries and geothermal reservoirs are often found at relatively shallow depths in their vicinity.

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Many of the SOPAC member island countries are located along crustal plate boundaries and are of volcanic origin. Accordingly, there is significant potential for discovery and/or confirmation of economically viable geothermal resources on these islands to develop. Fiji, Vanuatu, Papua New Guinea, the Solomon Islands and Samoa are typical and have been selected as the sites for initial PIRGADI activities. PIRGADI work to be conducted in these five countries will include geologic, geochemical, and geophysical studies as well as the drilling (in Fiji and Vanuatu only), of slim diameter confirmatory wells. The primary benefits of this work will be greatly improved characterization of the geothermal resources in each country including their chemistry, pressure, depth, areal extent, temperature, productibility and reliably indicate costs and risks that will be associated with their exploitation. The acquisition of all this information should greatly reduce the perceived risk for potential investors and developers who will, as a result of the investigation, be able to be furnished with all of the data, interpretations, conclusions and recommendations resulting from the PIRGADI activities. The estimated cost of the proposed PIRGADI is $US 5,674,000 and the estimated maximum time required to conduct the work is 5.5 years. The annual potential savings that can be realized by replacing diesel-fueled generation with geothermally fueled power have been calculated at $US 2.1-2.8 million per megawatt installed. Accordingly, if only 2.0-2.7 MW of geothermal power is built as a result of the PIRGADI, the entire $US 5.7 million cost of the initiative will be repaid in one year. If a 3 MW geothermal plant were to be run in the SOPAC region for 20 years, the savings would aggregate $US 4 2-56 million (without considering interest earned on invested savings). The conclusion is that investment in the PIRGADI is prudent. It will be very beneficial and cost-effective for the geothermally-rich SOPAC member countries.

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TABLE OF CONTENTS
Section Page

EXECUTIVE SUMMARY ............................................................................................................II I. INTRODUCTION ............................................................................................................... 1 1. 2. 3. II. THE MEANING OF PIRGADI, PROJECT RATIONALES AND OBJECTIVES ............................ 1 SUMMARY BACKGROUND OF SOPAC, THE PROJECT SPONSOR , .................................... 2 SUMMARY DESCRIPTION OF U.S. GEOTHERMAL INDUSTRIES CORPORATION , .............. 3

SCOPE OF PIRGADI ........................................................................................................ 4 1. A SUMMARY OVERVIEW OF SOME GEOTHERMAL PRINCIPLES .......................................... 4 2. GEOLOGIC REASONS FOR THE GEOTHERMAL POTENTIAL IN SOME S OUTH PACIFIC .......... 5 3. SOME RATIONALES FOR USE OF GEOTHERMAL RESOURCES IN THE SOPAC REGION ...... 6 A. Economic Advantages............................................................................................. 7 B.Environmental advantages....................................................................................... 7

4. THE INITIAL GROUP OF ISLAND COUNTRIES TO BE INCLUDED IN PIRGADI........................ 8 Fiji ................................................................................................................................. 8 Vanuatu ...................................................................................................................... 10 Papua New Guinea .................................................................................................... 12 Solomon Islands......................................................................................................... 14 Samoa........................................................................................................................ 15 Other SOPAC region countries ................................................................................. 17 5. BUDGET ESTIMATE FOR PROPOSED PIRGADI ACTIVITIES ........................................... 18 6. PROPOSED ACTIVITY SCHEDULE.................................................................................. 18 7. POTENTIAL FUEL-COST SAVINGS ATTRIBUTABLE TO GEOTHERMAL REPLACEMENT ......... 19

APPENDICES APPENDIX A LIST OF USGIC SHAREHOLDING COMPANIES ........................................ 20 APPENDIX B CURRICULA VITAE FOR SOPAC AND USGIC PIRGADI GEOSCIENTISTS TO BE INVOLVED WITH THE PIRGADI ................................................................................ 22

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PACIFIC ISLAND REGIONAL GEOTHERMAL ASSESSMENT AND DEVELOPMENT INITIATIVE

A FUNDING PROPOSAL
I. 1. INTRODUCTION The meaning of PIRGADI, project rationales and objectives

PIRGADI is an acronym for Pacific Island Regional Geothermal Assessment and Development Initiative. This name has been selected because it adequately summarizes the location and objective of the project for which the sponsor seeks funding. The three key reasons to conduct the proposed studies are: 1. Because the selected Pacific islands are of geologically recent volcanic origin, it is very likely that they overlie geothermal reservoirs that can economically be discovered, produced and utilized to fuel generation of electric power. This proposed project would help these island countries take advantage of their indigenous resources. 2. The use of geothermal resources to generate electricity would reduce and possibly eliminate the dependency of these island countries on imported fossil fuels for their power generation. This would improve their balances of payments and thus help their overall economies. 3. Though these countries are relatively minor contributors to atmospheric pollution via their fossil fuel exhaust emissions, their use of geothermal fuels would reduce or eliminate such power-related contamination making them small, but notable, role players in the fight against climate change and climate variability. The objectives/modus operandi of the PIRGADI are as follows: 1. Utilize the results of all geothermal exploration conducted to date to identify specific sites in the region that are the most prospective for the discovery of high temperature geothermal resources that can be economically exploited. 2. Initiate or continue geothermal exploration at these sites in order to better quantify resource parameters including reservoir depth, size and permeability, temperatures, pressures and chemical characteristics of produced fluids, and recharge rates and sources. 3. Determine the current and projected status, including costs, reliability, adequacy and economic viability of electric power generation, demand, transmission and distribution on each geothermally prospective island. 4. Synthesize the resource-related information and the power-related data so that plausible geothermal development/power sales scenarios and financial proformas can be generated. 5. Disseminate all of the information acquired and the conclusions drawn there from to the worlds geothermal development entities to seek expressions of interest and to facilitate early initiation of one or more geothermal power projects in the SOPAC region.

6. Consider the utilization of geothermal energy for non-electric direct uses such as crop drying, fish processing, furniture processing and other light industrial purposes. Though the economic benefits of such uses of geothermal resources are different from those reaped from its use for power generation, while the status of the electric power industries on each of the islands are being assessed, the same will be done with regard to the opportunities for beneficial use of low enthalpy geothermal fluids. 2. Summary background of SOPAC, the project sponsor, its capabilities and its roles in PIRGADI

The sponsor of this PIRGADI funding proposal is the South Pacific Applied Geoscience Commission (SOPAC). SOPAC is an independent, intergovernmental regional organization established by South Pacific nations in 1972. Its primary focus is the provision of geotechnical services to its supporting countries. Its Secretariat is located in Suva, Fiji where about 60 professional and support staff are domiciled. The 18 SOPAC member Countries are: Australia, Cook Islands, Federated States of Micronesia, Fiji Islands, French Polynesia (Associate), Guam, Kiribati, Marshall Islands, Nauru, New Caledonia (Associate), New Zealand, Niue, Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu. SOPACs mission is to improve the well being of the peoples of Pacific Island member countries through the application of geoscience to the management and sustainable development of their natural resources. SOPACs work for its member nations focuses on three key areas: resource development, environmental geoscience and national capacity development in the geosciences. Resource development includes mineral, water and energy resources and in the latter category, SOPAC has expertise in policy and planning, database development and management for energy data and technical information, energy resource assessment monitoring and coordination (wind, solar, biomass, ocean and hydropower), small energy project management, renewable energy project management, energy efficiency and conservation management and projects, and the monitoring of alternative renewable energy projects including geothermal. Specifically, with regard to geothermal, SOPAC coordinated and managed the 1993-1995 comprehensive regional geothermal resource assessment program, funded by the New Zealand Ministry of Foreign Affairs and Trade and SOPAC. This program provided much of the information that has encouraged the submittal for funding of the PIRGADI so as to move to the next stages of geothermal development in the SOPAC countries. SOPAC management and staff to be involved with the PIRGADI include the following persons, for whom brief C.Vs are included in Appendix B to this document. Alfred Simpson Director - SOPAC Russel Howorth Deputy Director - SOPAC Paul Fairbairn Energy Manager - SOPAC Anare Matakiviti Energy Advisor - SOPAC The primary SOPAC roles in the PIRGADI will include, but may not be limited to: 1. Project-related communications with government entities in each PIRGADI host country before, during and following conduct of proposed activities.

2. Active participation in all procedures required to obtain project-related permits, licenses, etc. in each PIRGADI host country. 3. Participation in the conduct of PIRGADI field activities as appropriate with regard to SOPAC staff capabilities, skills and experience. 4. Dissemination of PIRGADI work-related information to SOPAC member countries and outside the region as may be appropriate. 5. Assumption of responsibility for distribution and use of funds, for writing of required reports to lenders and for maintenance of accounting records. 6. Dissemination of documents describing interim and final PIRGADI results, conclusions and recommendations within and beyond the SOPAC region. 3. Summary description of U.S. Geothermal capabilities and its roles in PIRGADI Industries Corporation, its

Notwithstanding the fact that SOPAC has had experience with geothermal studies, the geoscientists employed by SOPAC are not professional geothermal geologists, geochemists, geophysicists or geothermal drilling engineers. In light of this situation, and because the shareholding member firms of U. S. Geothermal Industries Corporation (USGIC) have an interest in development of geothermal projects outside of the United States, USGIC has offered its services to SOPAC with regard to design, management, supervision and/or actual execution of PIRGADI activities. USGIC was incorporated in the State of Delaware, USA on March 21 1990. Its shareholders comprise 16 companies that have received Certificates of Review (CORs)1 from the U.S. Departments of Justice and Commerce in order to obtain substantial antitrust immunity when collaborating on overseas geothermal projects. USGIC was organized in order to provide a vehicle through which American firms engaged in the sales of goods and services to the geothermal industry within the United States could profitably sell their products and use their expertise internationally. The companys headquarters are in Frisco, Colorado, USA, while its shareholding member firms operate out of their respective headquarters located in the states of Arkansas, California, Colorado, Nevada, New York, Texas and Utah. The companies that have joined to create USGIC realize that by pooling talents, cooperating and collaborating, under the umbrella of the CORs, they can maximize their strengths as geothermal project investigators, participants and/or developers. Review of the list of USGIC shareholding companies (see Appendix A) will reveal that USGIC is able to conduct essential geothermal project development-related activities including: resource exploration (geological, geochemical, geophysical), environmental assessment, permit acquisition, drilling, well testing, reservoir engineering, field design, gathering system design and construction, and customized control system installation. USGIC is able to undertake all or parts of any size geothermal power generation project using the capabilities of its member firms. Project teams can be selected to maximize the

The Certificate of Review (COR) is a document issued by the US Department of Commerce and Justice that assures USGIC shareholding companies that they can "collude and collaborate" on offshore projects without fear of prosecution under the US anti-trust laws.

cost effectiveness of the work while project administration, finance and host country contacts can be conducted by USGIC in cooperation with SOPAC. Of specific relevance to the PIRGADI, is the fact that since 1998, USGIC has been conducting geothermal pre-feasibility studies in selected nations within Asia and the Western Pacific. This work has been funded by the US Department of Energy and has been documented in reports concerning the Philippines, Fiji, Vanuatu and Papua New Guinea. USGIC management and staff to be involved with the PIRGADI include the following persons, for whom brief CVs are included in Appendix B to this document. Gerald Huttrer Subir Sanyal Martin Booth Eduardo Granados David Mendive Roger Henneberger Chris Klein Anne Robertson-Tait The primary USGIC roles in the PIRGADI will include, but may not be limited to: 1. Design of work plans, budgets and schedules for the PIRGADI in each country. 2. Operation of the PIRGADI, within budget and time constraints, using the best professionally accepted practices. 3. Provision to SOPAC and/or host country officials, of all technical information needed to obtain project-related permits, licenses and approvals. 4. Design, management, supervision and/or conduct of planned PIRGADI field activities. 5. Interpretation of the results of all PIRGADI field activities in each host country, plus formulation of conclusions and generation of recommendations regarding follow-on work, all to be documented in comprehensive, country-specific final reports submitted to SOPAC. II. 1. SCOPE OF PIRGADI A summary overview of some geothermal principles

The word geothermal comes from the Greek words geo (earth) and therme (heat) and means the heat of the earth. The planets interior heat originated during its fiery consolidation from dust and gas over 4 billion years ago and it is continually regenerated via the decay of radioactive elements that exist in most minerals. It is almost 6,500 kilometres (4,000 miles) from the surface to the center of the Earth, and the temperature rises with increasing distance from the surface. The outer layer of the planet, the crust, is 5-56 kilometres (3-35 miles) thick and insulates the surface from the heat of the interior. From the surface down through the crust, the temperature gradient ranges from 17-30oC per kilometre (50-87oF per mile) of depth. Below the crust is the mantle, made of highly viscous, partially molten rock with temperatures between 650 and 1,250oC (1,200-2,280oF). At the Earths core, which consists of a liquid outer zone and a solid inner zone, temperatures may reach 4,000-7,000oC (7,200-12,600 oF).

Since heat always moves from hotter to colder regions, the Earths heat flows from its interior towards the surface. This upward flow of heat drives convective, cellular motions in the mantle rock, which in turn drives plate tectonics or the drift of the Earths crustal plates that occurs at 1-5 centimetres (0.5-2 inches) per year. Where plates move apart, molten rock known as magma rises upward into the rift creating new crust. Where plates collide, one plate is forced beneath the other (a process called subduction), downward into regions of increasing heat. Eventually, the subducting plate reaches conditions of pressure, temperature and water content that cause melting of the plates rocks thus creating new magma. Plumes of magma then rise convectively and force themselves into (intrude) the crust, bringing with them vast quantities of heat. Where magma reaches the surface it can build volcanoes, however most magma remains beneath the surface where it creates huge subterranean regions of hot rock. Cooling of such regions can take from 5,000 to more than 1 million years. Typically, the ground overlying these relatively shallow regions of elevated crustal heat is characterized by anomalously high thermal gradients. In some regions having elevated t ermal gradients, meteoric waters percolate downward, h sometimes for several kilometres, along subterranean cracks and faults. At depth, these waters are heated by the surrounding rock after which they convectively rise again towards the surface where they appear as hot springs, mud pots, geysers or fumaroles. If the ascending hot waters meet an impermeable rock layer, the water remains underground where it fills pores and cracks typically comprising 2 -5% of the volume of the host rock, forming a geothermal reservoir. These reservoirs that are generally much hotter than the thermal waters emanating at the surface, can reach temperatures of more than 350oC (700oF) and therefore constitute very powerful latent sources of energy. Scientists and engineers commonly search for geothermal resources in volcanic areas and in regions where it is known that subduction is occurring. Within these prospective areas, they begin their exploration by examining the surface thermal phenomena, after which they use geologic, geophysical (electrical, magnetic, gravity and seismic) and geochemical surveys to indirectly locate underground geothermal reservoirs. In a second exploration phase, thermal gradient holes may be drilled in order to confirm the reservoir location and extent. After this, deep drilling begins, employing either slim holes (holes with diameters smaller than the typical production well), to minimize costs, or full-scale production wells, which are normally drilled in situations where the degree of confidence in the exploration results is very high. Hot waters and/or steam either flow out of the wells naturally or are pumped to the surface where, at temperatures of 120-370oC (250-700oF), they are used to generate electricity in geothermal power plants. Shallower r eservoirs with lower temperatures of 20-150oC (68o 300 F) are commonly used directly in health spas, greenhouses, fish farms, crop drying, and for other light industrial purposes. 2. Geologic reasons for the geothermal potential in some South Pacific islands

The geothermal environment in many South Pacific islands is highly prospective because almost all of the conditions requisite for the formation of geothermal reservoirs, including spreading centers, plate boundaries, transform and transcurrent fault systems, all as summarized above, exist in the region. Crustal plates, including the Indo-Australian, the Pacific Plate and several unnamed, plate fragments have been colliding with each other, rotating and subducting to various degrees for more than 10 million years. These movements have resulted in the formation of many island arcs, oceanic trenches and volcanic belts that are the locus for world class porphyry copper-gold and epithermal gold mineral deposits, both of which can be considered to be ancestral geothermal systems.

Also, as described previously, tremendous volumes of magma, generated by lengthy periods of subduction and deep subsurface melting, have risen to the surface, solidified and created entire island groups. Some of these volcanoes are now extinct, but many others are either dormant or active and in their vicinities exist the hot springs, fumaroles, mud pots and geysers that constitute evidence of powerful geothermal resources at depth nearby. In Fiji, the evidence for geologically recent volcanism comprises the 20,000 year old ashes found on Taveuni and Rotuma islands and more than 16 volcanic centers and fissure zones of Pliocene or younger ages. In Vanuatu, volcanic eruptions that began about 22 million years ago to form the northern islands, have continued into the present so that the southern islands, including Efate, are still being uplifted at significant rates by suboceanic emplacement of new magma. On the latter islands, there are active volcanoes, fumaroles and hot springs that strongly suggest the existence of geothermal reservoirs at relatively shallow depths. In Papua New Guinea, there are more than 28 known thermal systems that appear to be related to movements of the small but regionally important South Bismarck Crustal Plate, to subduction currently underway along the New Britain Trench, and to magma being generated along the Woodlark Spreading Center. There exist many active volcanoes and associated with them, especially along the northern coast of New Britain Province, a numerous re geothermal phenomena believed likely to overlie prospective geothermal reservoirs. The Solomon islands lie precisely on the southeastern extension of the New Britain Trench that localizes volcanism in the islands of eastern Papua New Guinea. High temperature thermal features have been mapped on Vella Lavella and Simbo islands and cooler, but geochemically interesting springs have been identified on Guadalcanal island. All of these prospective geothermal sites are related to Plio-Pleistocene through Holocene volcanism. In Samoa, volcanism along the Samoan Ridge has created large shield volcanoes and smaller cones. The activity on the westernmost major island, Savaii, was most intense from the Pliocene to the middle Pleistocene and is thought to have been decreasing since then. Nevertheless, three volcanoes on Savaii have erupted in historic times, with the most recent event being that of Mt. Matavanu in 1911. Accordingly, the environs of these volcanoes are judged to be highly prospective for the discovery of one or more geothermal reservoirs. On several other SOPAC member (or associate member) islands, there exist geothermal phenomena that should be further studied. These are located in the Tonga, Kermadec, New Caledonia and Loyalty island groups. These geothermal occurrences are all related to plate subduction, nearby rifting, magma generation and associated volcanism or other deep, regionally important crustal fractures that facilitate or result from plate movements. 3. Some rationales for use of geothermal resources in the SOPAC region islands

Currently, electricity is generated under the auspices of the governments of most Pacific Island countries, using diesel-powered generators and/or hydroelectric facilities. Operation of the diesel g enerators requires the import of expensive fuel on a regular basis and the replacement of the machinery every 10-15 years. The power plants are very noisy and the exhausts of the machines include significant quantities of carbon dioxide, nitrogen oxides and various sulfur compounds, all of which have deleterious effects on the atmosphere and on the health of citizens with homes or businesses nearby. Hydroelectric power plants are much cleaner and quieter, but they depend on adequate annual rainfall to keep their reservoirs full and the reservoirs themselves commonly occupy land that was once used habitation, for agricultural purposes or on which native forests grew.

More generally the timely opportunity to pursue the development of geothermal energy resources in the region has been enhanced through the fact that geothermal power generation technology including borehole drilling has now advance significantly. Thus making previously considered marginal geothermal resources possible for development. The convenience of using geothermal energy for power generation as opposed to fossil based fuels is also attractive from the aspect that geothermal energy is a renewable energy resource and theoretically therefore provides a better and more secure source of supply. This is particularly important where the greater percentage of the regions fossil fuels are imported which raises questions in regard to accessibility and security of supply. Environmental issues in respect to emissions from fossil fuels used to produce energy are further elaborated on below but is a real concern for the region in particular in relation to climate variability and sea level rise. Several cogent reasons for island countries in the SOPAC region to utilize geothermal energy for power generation are presented and discussed below: A. 1. Economic Advantages Fuel purchases are never needed for geothermal power plants once a well field has been developed. Drilling of replacement wells will be required every 10 years or so, but otherwise, all of the money now being spent on the purchase and import of fuel for power plants can be saved and put to better use for the good of the citizens. There is long term resource potential. With optimum development strategies, geothermal energy can provide a significant portion of a countrys long term (30-50 years) energy needs. Geothermal plants have exceptionally high availability. Availability is defined as the percentage of time that a system is capable of producing electricity. Availability of 9599% are typical for modern geothermal plants, compared to less than 90% for fossil fueled installations. The operating and maintenance (O&M) costs of geothermal plants are low. Geothermal power system annual O&M costs are typically about 5-8% of the capital cost, much like the non-fuel O&M costs associated with fossil fuel power systems. However, with the increasing use of automated control systems for the well fields and power plants, geothermal O&M expenditures are decreasing. Geothermal power project sizing can be flexible. Projects sizes have ranged from 200 kilowatts (in China) to complexes capable of producing 1,200 megawatts or more (in the USA). Geothermal power projects can also supply fluids for direct use. Depending on the resource temperature and the process temperature required, many different applications can be served from a common set of wells and/or by utilizing underflow from the power plant. This combined or cascaded use of geothermal energy results in higher thermal efficiencies and associated cost savings. Environmental advantages Geothermal power plants emit minimal atmospheric pollutants. Diesel plants emit about 880 kg of carbon per megawatt-hour (MWh) while geothermal plants exhaust about 0.3 pounds. The sulfur emission rate of geothermal plants is about 0.44 pounds per MWh compared to 23 kg per MWh for diesel and nitrogen from geothermal plants is

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virtually nil, while it is a significant pollutant emitted by diesel plants. All in all, geothermal power stations have proven that they can meet and surpass even the most stringent environmental demands all over the world. 2. Very little land area is required by a geothermal power project, unlike hydroelectric plants with their associated reservoirs. Geothermal power plants are small, typically covering less than 400 square metres. The wells themselves, once they have been drilled, occupy only about 25 square metres each and the gathering and disposal systems, comprising compact networks of 36 centimetre diameter pipes, can be designed to accommodate passage over, under or around by humans, animals, and/or vehicles. Geothermal power projects can be built-in modules to allow for expansion. A single good geothermal well can support 3-10 megawatts of power and the power plant can take less than a year to build. When more power is required, new wells can be drilled and plant modules can be added so as to keep pace with demand. Geothermal power plants are quieter than diesel plants. Though geothermal turbines and generators do make noise as they run, most plants have been insulated so that the noise remains inside the buildings resulting in a quiet and peaceful environment for all those outside the plant walls. The initial group of island countries to be included in PIRGADI

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The PIRGADI will initially continue the process of developing the geothermal potential in Fiji, Vanuatu, Papua New Guinea, Samoa, and the Solomon Islands. Other SOPAC member (or Associated) countries, yet to be specified, may also be sites for preliminary geothermal investigations. Presented below, on a country by country basis, are: descriptions of the geothermal site locations, the national power generation status, the geothermal surface phenomena, proposed PIRGADI activities and the expected benefits to each country of the PIRGADI work. Fiji a. Location Investigations previously conducted in Fiji by GENZL and SOPAC have resulted in the identification of two primary geothermal prospect sites: Savusavu and Labasa, both of which are located on Vanua Levu, at latitudes of 16o47 South and 16o 31 South and longitudes of 179o20 and 179o23 East respectively. b. Power Generation status (i) Generating capacity The largest and most heavily populated island, Viti Levu, has considerable hydroelectric capacity at the 80 MW Wailoa Power Station. The island depends on that capacity for most of its power. The next largest island, Vanua Levu, has a run of river hydroelectric plant that provides a small but important contribution to total generation on the island, but diesel engines and bagasse-fired steam cogeneration provide most of the islands power. Installed capacity in the three largest systems, as of 2000, is given in Table 1 below:

Table 1 Public Sector Power Generation Capacity in Fiji Island Viti Levu Vanua Levu Ovalau Total

Capacity MW 112 12 2 126

This table does not reflect private generating capacity, such as the 10 MWe owned by Fiji Sugar Corporation (FSC) or the 30 MWe installed at the Emperor Gold Mine (EGM). This capacity is an important aspect of the electric sector in Fiji. For instance, in the town of Labasa on Vanua Levu, FSC has a 10 MW bagasse-fired steam unit and a 4 MW diesel generator, making it the largest single power producer on that island. (ii) Fuel Types Currently, hydroelectricity dominates the overall Fiji fuel mix, followed by diesel and bagasse, however, on Vanua Levu there is only one small hydroelectric plant at present and the other two fuels are dominant. There are also some small isolated photovoltaic installations on Vanua Levu but these total only a few kilowatts.

(iii) Generation Cost The cost of electricity produced by Fiji Electricity Authority (FEA) ranges from a low of 4-5 F/kWh (~2 US/kWh) for hydro power produced by the Wailoa Power Station, to over 30 F/kWh (13.6 US/kWh) for power produced by the many small diesel engine generators used in the islands. In 1999, FEA reported that the cost of diesel fuel was approximately F$400/tonne (US$0.59/gallon). By late 2000, this cost had more than doubled to F$900/tonne (US$1.33/gallon). (iv) Power Sales Prices In Fiji, all customers pay 20F/kWh (9.6/USkWh). The cost of production from diesel engines is greater than the retail cost of electricity in Fiji so, in effect, Wailoa hydro power subsidizes the diesel power and the amount of this subsidy increases as diesel fuel prices escalate. (v) Estimated Future Demand Growth FEA October 2000 forecasts are that by the year 2015, the demand in Labasa will be 21 MWe and that in Savusavu will reach 2 MWe. If the two grids are joined and extended, as planned, the Vanua Levu need could approach 25 MWe.

c. Geothermal Surface Phenomena Savusavu On the Savusavu peninsula there are at least eight thermal springs and perhaps several more whose existence is suggested by thermal infrared imagery, but which have never actually been found. The hottest spring water temperatures, near boiling, have been measured in a group of six orifices located along and slightly inland from the northern peninsula shoreline and extending from a site immediately west of the Savusavu Yacht club to a site slightly west of the town dock. Chemical analyses of the hot spring waters suggest that they are of meteoric origin, very slightly mixed with sea water, and that at some depth they equilibrated with the surrounding rocks at about 170oC (338oF). The results of aeromagnetic surveys conducted over the Savusavu peninsula suggest that an east-west trending range of low hills rising just south of the hot springs may be underlain at depths of less than 1

kilometre (3,280 feet) by an intrusive rock body. This could comprise a heat source for the thermal waters if it is still cooling and radiating heat. In summary, all of these conditions strongly suggest the existence of a significant geothermal resource in the area. The drilling of confirmatory slim holes to at least 800 metres (2,625 feet), is therefore strongly recommended. Labasa A geothermal belt comprising eight groups of hot springs extends for about 19 kilometres across central-northern Vanua Levu island, just south of the town of Labasa. Each spring group has numerous discharge points, either as small pools, flows from rock fractures or as seeps from alluvial river banks. As at Savusavu, thermal spring temperatures are up to boiling, despite undoubted dilution by rainfall aggregating 2000 to 3800 millimetres per year. Geochemical studies of the thermal waters show that they are of meteoric origin and have probably circulated to great depths where they were once heated to as much as 120oC (248oF). It is also believed that they circulate within a network of fractures transecting an oval-shaped depression of possible volcano-tectonic origin. Mixture of the thermal waters with seawater appears to be minimal. Because of the relatively low geothermometric temperatures calculated, and the absence of an obvious heat source, it appears unlikely that the Labasa geothermal region will be underlain by a reservoir hot enough to use for generation of electric power. Nevertheless, if and when a drill is shipped to Vanua Levu to explore the Savusavu resource, it is recommended that three 800 metre (2,625 feet) deep slim holes also be drilled in the Labasa geothermal belt. d. Proposed PIRGADI project activities In accordance with the recommendations described above, it is proposed that the PIRGADI activities in Fiji comprise the drilling of six slim holes to 800 metres (2,625 feet). Three holes would be drilled in and near the Savusavu thermal phenomena and three within the Labasa geothermal belt. The drill sites might be those advocated several years ago by GENZL or they might be modified to reflect newer geoscientific theories. e. Expected benefits of PIRGADI work in Fiji If the recommended slim holes are drilled in the Savusavu and Labasa geothermal areas, a great deal more will be learned about the local geology, the thermal regime, and the permeability and other aspects of the geothermal reservoir. This knowledge will significantly reduce the risks of failure when the next development step is taken and production-scale wells are drilled. It should therefore improve the chances of obtaining funds, private or other, for full exploitation of one or both of the Vanua Levu geothermal fields and it will facilitate d esign of optimally costeffective development procedures. Vanuatu a. Location Because the Vanuatu archipelago has been created as a result of volcanism along a major crustal plate boundary. There are active volcanoes on several islands and geothermal resources are likely to be associated with each mountain. However, the bulk of Vanuatus population and the greatest power demand are on Efate Island, therefore it is the best place to initiate development of Vanuatus geothermal resources. Geothermal exploration previously conducted in Vanuatu identified two prospective sites on Efate Island. Takara Springs are on the north end of the island at 17o 32 South and 168o 25 East while the Teouma Graben springs are just northeast of Port Vila at 17o 48 South and 168 o23 East.

10

b. Status of power generation (i) Capacity UNELCO operates a diesel-fueled power plant in Port Vila, the nations capital and principal city on the island. This plant comprises nine diesel generating units, ranging in size from 630 kW to 2170 kW. A second power plant of very modern design was recently constructed at Tagab, just outside of Port Vila. This plant has 2 new units both rated at 4100 kW. A total of four additional units are anticipated in the design of the Tagab site. The third of these is scheduled for installation in 2004, but according to UNELCO management, this could be deferred if a geothermal field is developed and a geothermal power plant built. The present capacity on Efate therefore now totals 19.6 MWe. Fuel types UNELCO currently uses diesel fuel exclusively to generate power on Efate.

(ii)

(iii) Generation cost - In Vanuatu there are 6 tariffs for electricity sold by UNELCO. All of the tariffs are based on a base rate of 34.59 Vatu/kWh (~24.213 US/kWh). No figures were published for the actual cost of power generation by UNELCO, but it is likely that there is 9-10% profit built into the above rates and that the generating cost must be around 14 US/kWh. (iv) Power sales prices The table below is self explanatory. Table 2 - UNELCO Tariff Rates
Tariff (Base Rate P = 24.213 US/kWh) Small Domestic (PCD) st 1 60 kWh nd 2 60 kWh all over 120 kWh (penalty) Low Voltage Business (TUP) Low Voltage Other (TU) High Voltage (MT) Sports Field (T) Public Lighting (EP)
rd

Fixed Charge US$/kVA -0-0-020 x P 19 x P 25 x P 4.8426 4.6005 6.0532 -0-0-

Energy Charge US/kWh 0.62 x P 0.93 x P 1.70 x P 0.87 0.96 0.70 1.00 0.54 x x x x x P P P P P 15.01 22.52 41.162 14.975 23.244 16.949 24.213 13.075

Source: UNELCO Electricity Tariffs, 3 Quarter 2000, July-September.

(v)

Estimated future demand growth The present capacity of 19.6 MWe is more than sufficient to meet the peak load requirements of UNELCOs territory in Efate. At present rates of load growth, reportedly in the 4-6% per annum range, it is anticipated that no new capacity will be needed for some time. The schedule for installation of the next unit at Tagab (in 2004) is most likely driven by the need to retire older units, rather than accelerated load growth and it also depends somewhat on the probability of a geothermal plant being built. The load on Efate recorded by UNELCO during the fiscal year 98/99 was approximately 7.5 MW peak, 4 MW average, and 2.5 MW base. The fact that the base load on Efate is in the order of 2.5 MW is of significant interest for prospective geothermal development. Geothermal power plants are typically used as base load generation, in part due to their high initial cost and low-operating cost. Thus a geothermal power project on Efate should most likely be in the 2-4 MW range, at least initially.

11

c. Geothermal surface phenomena Takara Springs The geothermal area comprises about 0.405 hectares at the northeastern end of Efate. At least 5 thermal springs flow from shallow channels within this area and the Beachcomber Resort taps 57oC (134oF) water via a 4 diameter, PVCcased well drilled to about 6 metres (20 feet). Reportedly, the temperature of the water increases to 78oC (174oF) after the pump is run for 20 minutes or so. The well produces enough water (19-25 gpm) to fill a 15 diameter pool 3-4 feet deep in 3-4 hours. The Takara Springs waters have been sampled and the geothermometry suggests equilibrium temperatures of 160-170oC (320-340oF) at some undetermined depth. This would be a high enough temperature to allow use of the resource for power generation. Teouma River Hot springs with surface temperatures ranging from 50-61oC (122142oF) flow from the eastern boundary fault of the Teouma River graben that transects the southern part of Efate. Thermal water flow rates range from seeps (<0.5 l/sec) to what have been described as voluminous, with reference to a specific hot spring said to issue from a cave, located about one days walk upstream from the circum-island road. Geochemical studies conducted by GENZL in 1975 have revealed geothermometric equilibration temperatures for Teouma waters of >200oC (>93oF). Such temperatures would be more than adequate for use in generating electric power. d. Proposed PIRGADI project activities In order to evaluate the geothermal potential at both the Takara Springs and the Teouma River geothermal areas, it is proposed that the PIRGADI activities comprise the drilling of four slim h oles to 1,800 metres( 5,904 feet). Two holes would be drilled in and/or near each of the hot spring regions. The locations of the drill sites will be determined on the bases of the results of electrical resistivity studies conducted by GENZL and also with respect to logistical constraints posed by land ownership and topographic conditions. e. Expected benefits of PIRGADI work in Vanuatu If the recommended slim holes are drilled in the Takara Springs and Teouma River geothermal areas, a great deal more will be learned about the local geology to depths well below sea level, the thermal gradients and bottom-hole temperatures, and the physical and chemical characteristics of the geothermal reservoir rocks and fluids. These slim holes will therefore provide the basic information required to make a wellinformed decision whether or not to proceed with the drilling and development of production and injection wells. This preliminary drilling will therefore improve the chances of obtaining funds, private or other, for full exploitation of one or both of the Efate geothermal fields and it will facilitate design of optimally cost-effective development procedures. Papua New Guinea a. Location Reconnaissance studies of the geothermal potential of Papua New Guinea (PNG) have suggested that the most prospective area for initial pre-development investigations is the northern coast of New Britain Island, from the Willaumez Peninsula eastward to the Gazelle Peninsula. In that region, there are at least seven geothermal sites: Bamus, Galloseulo, Walo, Kasoli-Hoskins, Garbuna, Pangalu-Talasea and Bola. These geothermal areas are situated between Latitudes 5o 5N and 5o 38N and between Longitudes 150 o 3E and 151o 20E. b. Status of power generation All aspects of urban electric power generation, transmission and distribution are controlled by what was known as the Papua New Guinea Electricity Commission (ELCOM). This entity is now called PNG Power Limited and operates 20

12

independent generating systems in 27 urban centers and serves about 700,000 customers. PNG Power Limited is reported to be considering expanded use of renewable energy sources and their indigenous natural gas to expand their fuel mix. The creation of PNG Power Limited was the first step in a plan to make the utility more financially viable and thus more attractive to potential purchasers. The PNG Petroleum and Energy Department has focused on power supplies to rural areas and the Provincial Governments are responsible for the C centers in their respective provinces. Finally, though small diesel generators furnish power in most small rural towns and villages for at least a few hours each day, there is a continuing move to introduce renewable energy resources such as hydropower (micro/mini), wind, and solar energy systems where applicable. (i) Capacities The current total installed capacity of the PNG Power Limited facilities is 272 MWe (1995) in the Papua New Guinea, with an estimated national total of 595 MWe. Primarily mining companies privately own fifty four percent of the national total capacity. The Provincial Government-owned Government C Center Stations have an unpublished capacity that can be estimated at between 10 and 350 kW. Finally, the small generators operating in many small towns probably are about 1-2 MWe each and there are in excess of 100 such sites. Fuel Types PNG Power Limited uses 80% hydropower and 20% diesel-fueled stations to generate electricity for Port Moresby, Lae, Mt. Hagan, Wewak and Kokopo, while the Petroleum and Energy Department uses mini-hydro generators of 60-300kW to electrify small areas surrounding five rural government stations (Ccenters). These five are the first of 60 such plants reportedly planned by the Petroleum and Energy Department. The small independent town systems all use diesel fuel. Solar heaters are being used extensively for provision of domestic and some process hot water at homes and at light industrial sites all over PNG. Their acceptance is increasing rapidly.

(ii)

(iii) Generation cost The average cost of power generation by PNG Power Limited, using thermal generation, is $US 0.125 per kWh. (iv) Power sales prices PNG Power Limited customers now pay an average of $US 0.078 for their power. Diesel generation on Lihir Island (by the Lihir Gold Company) is said to cost the company about $US 0.12 per kWh. The cost of power being generated by the Provincial Governments or by the small town generators is between $US 0.30 and 0.45 per kWh. The cost is dependent on the accessibility of the location by normal air, sea, and land transportation. (v) Estimated future demand growth It is difficult to determine this figure, however, PNGs GNP is about $US 3.5 billion and increasing, so future power demand growth should conservatively be estimated at 3-5%.

c. Geothermal surface phenomena At Talasea, Pangalu and Kasoli, all on the north coast of New Britain, the thermal fields are associated with a belt of recent volcanic activity. The geothermal areas comprise numerous hot springs, geysers, fumaroles and mud pools at temperatures that range from 90-101oC (194-214oF) and which are reported to contain significant H2S and CO2. Of special interest is the fact that at these three locations, the silica content is very high at 347 ppm while the chloride content is only 2 ppm. This suggests that geothermometric equilibrium temperatures could be in the 300 oC (~572oF) range and that a dry steam geothermal reservoir could underlie the region. The fluids in the four geothermal areas to the east of the Willaumez Peninsula have temperatures from 86-100oC (187oF) and are slightly to moderately acidic, suggesting near surface volcanic heat sources.

13

d. Proposed PIRGADI project activities Because the most recent chemical analyses were made in 1988, waters and gases at all seven thermal sites should be resampled and the geothermometry recalculated using the most modern techniques. Geophysical surveys should be then conducted in the two most chemically promising areas to assess the shallow and deep electrical resistivity regimes. These surveys could utilize E-Scan, CSAMT or conventional dipole resistivity techniques as logistically indicated to achieve optimum cost-effectiveness. e. Expected benefits of PIRGADI in Papua New Guinea The geochemical survey results should indicate the hottest geothermal sites and the geophysical study results should suggest the probable depths to the geothermal reservoir(s) and the best places in which to drill slim or production-scale wells in the next development phase(s). This information should materially decrease the perceived resource-related risks for future project developers, leaving only market-related matters as the critical project-viability determinants. Solomon Islands a. Location Though there are many warm and hot springs in the Solomon Islands, there is no real market for electricity within the archipelago except for the capital city of Honiara, (population about 40,000) located on the northeastern side of Guadalcanal island. Forty kilometres to the northwest of Honiara, about five kilometres inland from the sea, are four thermal areas called Nggurara, Kunjuku, Saikotulu and Koheka. These geothermal areas are situated between Latitudes 9o 20S and 9o 23S and between Longitudes 150o 2E and 151o 20E. Another interesting geothermal site is located in Paraso Bay on Vella Lavella Island. If a power plant were to be built near this site, it might be possible that an energy-intensive industry could be attracted. The Paraso geothermal resource, at Longitude 156o 37E and Latitude 7o 39S, has surface temperature up to 99oC (210oF), considerable outflow and a geothermometrically calculated equilibrium temperature of 160oC (320oF) that would be adequate for power generation use. b. Status of power generation Solomon Islands Electricity Authority (SIEA) is responsible for provision of public power in the five largest provincial centers in the Solomons. Though diesel generators of varying ages are their primary electricity producers, the power mix does include a 185 kW hydropower facility that has been built in Buala. Transmission and distribution systems are old and subject to breakage, especially during cyclone season. Off-grid, small diesel generators, micro hydropower and/or solar systems furnish power in some small towns and villages for at least a few hours each day and the same is true for several resort complexes. There is reported to be interest by SIEA in tapping renewable energy resources such as mini-hydro, solar and wind to provide more power to rural areas. (i) Capacities The current total installed capacity in the Solomons is 30.959 MW. The capacity provided through diesel engines is 30.407 MW and the remaining 185 kW is via hydropower. Of all the power generation capacity in the country, 23.540 MW is in the capital city of Honiara. Fuel Types Diesel is the only fossil fuel currently used to generate power in the Solomons. Generation cost The average generation cost for the whole SIEA system in the country is $US 0.6875 per kWh.

(ii) (iii)

14

(iv) Power sales prices The energy sales prices are: High voltage bulk supply Domestic/residential Industrial/commercial (v) 75.50 cents per kWh 55.75 cents per kWh 82.50 cents per kWh

Estimated future demand growth Until 1999, and prior to the coup of June 2000, demand for electricity in the Solomon Islands was growing at a steady 6% per annum. In the post-coup era, through the end of 2001, the demand declined 10%. Current (2002) forecasts are for demand to increase at about 3% per annum for the next three years.

c. Geothermal surface phenomena At Paraso on Vella Lavella Island, thermal springs and bare, unvegetated ground cover about 1.7 square kilometres along the Ngokosole and Ulo Rivers which empty into the sea along the northeast coast of the island. Temperatures range from 32-96oC (89-205oF) and significant quantities of H S and CO2 2 are emitted. Previous workers in the area have estimated a potential for generation of 300 MWe, based on the calculated heat flow from the hot springs. On the northwestern corner of Guadalcanal Island, about five kilometres inland, within steep, difficult-to-access mountainous terrain, is the Nggurara geothermal area. This site includes the Nggurara, Kunjuko, Saikotolu and Koheka springs. Temperatures range from 38-63oC (100-145oF), but the geothermometric equilibrium temperature calculated is 160oC (320oF), which is adequate for use in power generation. The springs appear to be localized by a well developed north-south trending fault system that transects geologically young andesitic lavas. d. Proposed PIRGADI project activities At both the Paraso and the Nggurara thermal sites the waters and gases should be resampled and the geothermometry recalculated using the most modern techniques. Geologic mapping in the areas should also be accomplished at the same time. E-Scan, CSAMT or conventional dipole resistivity surveys should then be conducted in both areas to assess the shallow and deep electrical resistivity regimes. e. Expected benefits of PIRGADI in The Solomon Islands The geochemical survey results should indicate the hottest geothermal sites and the geophysical study results should suggest the probable depths to the thermal reservoir(s) and the best places in which to drill slim or production-scale wells in the next development phase(s). This information should materially decrease the perceived resource-related risks for future project developers, leaving market-related matters as the critical project-viability determinants. Samoa a. Location Though there are no hot springs described in the Samoa group of islands geologic or volcanologic literature, there are three volcanoes on the island of Savaii that have erupted within recorded historical times (1760, 1902, and 1905-1911). These mountains are aligned along an east-west trending rift zone that resembles the lower East Rift Zone, near Kiluea, on the island of Hawaii where very high temperature geothermal reservoirs have been discovered. These active volcanoes are situated in the vicinity of Latitude 13o 38S and Longitude 172o 30E, generally within the northwestern quadrant of the island.

15

b. Status of power generation Electric power on the island of Savaii is diesel generated and provides power to 85% of the island including the town of Salelologa. Private diesel generators are used as well. The rest of the island uses kerosene for lighting. There are reported to be about 50,000 people living on Savaii who live in villages spread along the coastal areas where electricity is not generally available. (i) Capacities The current total installed diesel capacity on Savaii island is 4.9 MWe with a de-rated (available) capacity of 3.5 MWe. The Japanese are currently considering the development of a hydropower scheme for Savaii. On Upolu (the main island of the Samoan group), electricity generated from both hydropower and diesel supplies the capital city of Apia and surrounding communities. The installed capacities are 12.4 MWe and 16 MWe respectively, with a firm total capacity of 20.4 MWe. In September 2001, a new 4.2 MWe diesel generator was installed on Upolu to increase the installed capacity. Samoa is unique in comparison to its Pacific island neighbors as it is considered to be 95% electrified. (ii) (iii) Fuel Types Diesel and hydroelectric plants are used to generate power in Samoa. Generation cost No current power generation in Samoa. figures are available for the cost of

(iv) Power sales prices The unit retail price for electricity in Samoa is as follows: 50 sene per kWh for 0-50 kWh 60 sene per kWh for 51-200 kWh 72 sene per kWh for 201 plus kWh (v) Estimated future demand growth It is estimated that the annual growth in power demand will be about 4%.

c. Geothermal surface phenomena There are no overt geothermal surface phenomena described in the literature reviewed to date, however it is known that lava was vented from Matavanu volcano between 1905 and 1911 and that a steam vent reportedly diverted the flows away from the grave of a locally venerated nun. Therefore it is considered likely that there are magma chambers beneath Savaii and that subsurface heat still exists and can be discovered in the vicinity of one or more of the Savaii volcanoes. This is supported by the fact that Holocene age basic lavas have been mapped in the area, there is contemporary seismicity in the archipelago and the event described above. d. Proposed PIRGADI project activities First, a thorough search of Savaii should be made for surface evidence of subsurface heat. The guide-services of any residents familiar with the local geology should be obtained and all prospective sites should be examined and described. Any thermal waters or gases found should be sampled and the geothermometric equilibration temperatures should be calculated. Geologic mapping in these areas should also be accomplished at the same time. If the results of the reconnaissance surveys, the geologic mapping and of any geochemical analyses are geothermally encouraging, then one or more geophysical surveys should be conducted to assess the shallow and deep electrical resistivity regimes.

16

e. Expected benefits of PIRGADI in Samoa A detailed survey of the island will hopefully result in the discovery of hot spots. The geochemical survey results should indicate where the highest geothermometric temperatures are to be found and the geophysical study results should suggest the probable depths to the geothermal reservoir(s) and the best places in which to drill slim or production-scale wells in the next development phase(s). This information should materially decrease the perceived resource-related risks for future project developers, leaving only market-related matters as the critical project-viability determinants. Other SOPAC region countries Several other island countries within the SOPAC region may have geothermal potential and may request reconnaissance investigations during the conduct of the PIRGADI. The budget and schedule presented below includes funds and time for undertaking geologic, geochemical and initial non-resource-related studies in up to two such additional countries.

17

5.

Budget Estimate for Proposed PIRGADI Activities

This budget covers activities described in the specific country sections presented above.
Indicative Costs: US$000 Activity Fiji Vanuatu PNG Solomon Samoa Others Total

Surface surveys
Reconnaissance Geology & Chemistry Geophysics Coord & Reporting Contingency 10% 55 0 0 0 6 61 27 0 0 0 3 30 36 25 600 86 75 822 30 10 200 22 26 288 20 5 100 20 10 155 17 3 0 13 3 36 185 43 850 141 123 1392

Science Totals Deep Drilling

Access & Site Mobilization Well Drilling Testing & Evaluation Design & Supervision Contingency 10%

170 150 1181 240 140 188 2069

250 300 1200 180 127 206 2263

0 0 0 0 0 0 0

0 0 0 0 0 0 0

0 0 0 0 0 0 0

0 0 0 0 0 0 0

420 450 2381 420 267 394 4332

Drilling Totals Program Totals

Notes

2130

2293

822

288

155

36

5724

6 slim wells 800 m. deep 24 months

4 slim wells 1800 m. deep 24 months

Reduce to 2 areas 6 months

2 areas

Areas not yet found 4 months

Areas not yet found 4 months 5.5 years

Estimated Schedule

4 months

Costs are based on 2001 information

sopacbudgetC.doc

6.

Proposed Activity Schedule

Despite the fact that no surface geoscientific studies are planned in Fiji or Vanuatu, the recommended drilling programs alone, in these two countries, may require 4 of the total 5.5 years estimated to complete the PIRGADI. Included in the activities to be conducted within the 24 months allocated for Fiji and Vanuatu work are: a. b. c. d. e. f. g. h. i. j. k. Verification of the locations of the sites to be drilled; Acquisition of the rights of ingress and egress to these sites; Acquisition of all the rights and permits needed to drill; Generation of bidding documents; Issuance of Requests for Bids to drill; Analysis of the bids received; Negotiation of drilling contracts; Preparation of site access and the drilling locations; Transport of the drill(s) and equipment to the sites; Actual drilling operations and moves between sites; and Flow testing of wells.

18

Six months have been scheduled for PIRGADI work in Papua New Guinea. The first two months would be spent examining the seven geothermal sites on the north coast of New Britain, sampling fluids and calculating geothermometric equilibration temperatures. The next four months would be spent conducting electrical resistivity surveys at the two sites deemed to be most prospective, on the basis of the earlier studies analyzing results and reporting conclusions and recommendations. Four months of PIRGADI work have been scheduled in the Solomon Islands, Samoa and possibly in up to two other countries within the SOPAC region. In each country, 1 month would be needed to examine and sample the geothermal areas and then 3 months would be spent conducting an electrical resistivity survey in the most prospective area. If no overt geothermal phenomena are discovered on Savaii Island, Samoa, and/or if no other SOPAC region countries request geothermal investigations, the full PIRGADI might be shortened from an estimated 5.5 years to about 5.4 years. The proposed schedule described above assumes that PIRGADI work would be conducted serially in several countries. It is possible, however, that work could be done simultaneously in one or more countries. In this case, the whole PIRGADI might be undertaken in as little as 2 years. Finally, it should be noted that the times allocated to the various activities described above are considered to be conservative. Nevertheless, cultural, political, religious or other constraints may be expected. These could cause delays in progress and increase the time (and cost) needed to finish the PIRGADI. 7. Potential fuel-cost savings attributable to geothermal replacement of diesel fuel

For this calculation, it has been assumed that: Diesel fuel can be bought for $US 30 per 159 litre barrel, Diesel-fueled generators in SOPAC member countries are now available for service 80% of the time (7008 hours per year), The existing generators consume between 0.21 and 0.25 kilograms of fuel per kilowatt-hour of power produced and The fuel-only current cost to generate electricity is therefore between $US 0.048 and $US 0.0574 per kilowatt hour

Using an average price of $US 0.053/kWh, it can be determined that by replacing dieselfueled generation with geothermally generated power, about $US 371,000 can be saved annually per megawatt. If the PIRGADI costs $US 5.7 million, the savings accrued by eventual development of 15.4 MW of geothermal power within the SOPAC region will recover the PIRGADI cost in 1 (one) year. If only one 3 MW geothermal project is built, the $US 5.7 million would be paid off in 5 years for an approximate ROI of 20%. If such a 3 MW plant runs for only 20 years, the accrued fuel cost savings will be $US 7.42 million (not counting any interest income derived by investment of saved money) and the PIRGADI costs would be repaid 130 %. Obviously, if more than one geothermal project is built and/or more than 3 MW are installed, savings and the benefit to cost ratio will increase significantly. The conclusion is that expenditure of funds to conduct PIRGADI is prudent, beneficial and can be costeffective for the geothermally-rich SOPAC region countries.

19

APPENDIX A List of USGIC Shareholding Companies

AIR DRILLING SERVICE, INC. C/O WEATHERFORD UBD JOHN BOYLE 515 Post Oak Blvd., Suite 600 Houston, TX 77027 Phone: 713/693-4000 Fax: 713/693-4270 e-mail: john.boyle@weatherford.com BARBER NICHOLS ENG. CO. KEN NICHOLS 6325 West 55th St. Arvada, CO 80002 Phone: 303/421-8111 Fax: 303/420-4679 e-mail: cbni@aol.com DAMES AND MOORE JILL HAIZLIP 221 Main Street, Suite 600 San Francisco, CA 94105 Phone: 415/896-5858 Fax: 707/882-9261

BALLEW TOOL COMPANY LEON & DEBRA BALLEW P.O. Box 361 Cobb, CA 95426 Phone: 707/987-0837 Fax: 707/987-3921

BIBB and ASSOCIATES, Inc. PHILIP MESSER 201 South Lake Ave., Suite 300 Pasadena, CA 91101-3094 Phone: 626/795-6866 Fax: 626/584-9210 e-mail: pmesser@bibbla.com BAKER HUGHES INTEQ NIC NICKELS 2050 W. Steele Lane, Suite C-1 Santa Rosa, CA 95403 Phone: 707/523-1751 Fax: 707/523-1398 e-mail: nic.nickels@inteq.com

GEOTHERMAL DEVELOPMENT ASSOC. GEOTHERMAL MANAGEMENT CO. INC. G.MARTIN BOOTH GERALD W. HUTTRER 770 Smithridge Dr., #550 Box 2425, 720 Granite St., Suite 202 Reno, NV 89502 Frisco, CO 80443 Phone: 775/825-5800 Phone: 970/668-3465 Fax: 775/825-4880 Fax: 970/668-3074 e-mail: mbooth@gda.reno.nv.us e-mail: ghuttrer@colorado.net
GEOTHERMAL POWER COMPANY, INC. GARY SHULMAN 1460 W. Water St. Elmira, NY 14905 Phone: 607/733-1027 Fax: 607/734-2709 GEOTHERMEX, INC. SUBIR SANYAL 5221 Central Ave., Suite 201 Richmond, CA 94804 Phone: 510/527-9876 Fax: 510/527-8164 e-mail: geothermex@compuserve.com NABORS INDUSTRIES DARRELL W. WILLIAMS 515 West Greens Road Houston, TX 77067 Phone: 713/874-0035 Fax: 713/872-5205

DRILL COOL SYSTEMS, INC. ELWOOD CHAMPNESS 627 Williams Street Bakersfield, CA 93305-5445 Phone: 805/633-2665 Fax: 805/327-5890 e-mail: Tom@kernSteel.com ORMAT, INC. DAN SCHOCHET 980 Greg Street Sparks, NV 89431-6039 Phone: 775/356-9029 Fax: 775/356-9039 e-mail: ormatintl@ormat.com

SAIC SABODH GARG 10260 Campus Point Drive; M/S X1137 San Diego, CA 92121 Phone: 858/826-1615 Fax: 858/826-1652 e-mail: Sabodh.K.Garg@saic.com

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ENERGY & GEOSCIENCE INSTITUTE DENNIS NIELSON 423 Wakara Way, Suite 300 Salt Lake City, UT 84108 Phone: 801/581-5126 Fax: 801/585-3540 e-mail: dnielson@egi.utah.edu

WILLIAMS TOOL CO. INC. JOHN R. WILLIAMS Box 6155 Fort Smith AR 72906 Phone: 501/646-8866 Fax: 501/646-3502

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APPENDIX B Curricula Vitae for SOPAC and USGIC PIRGADI geoscientists to be involved with the PIRGADI

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CURRICULUM VITAE FOR SOPAC GEOSCIENTISTS ALFRED THOMAS SIMPSON POSITION: NATIONALITY: MARITAL STATUS: WORK ADDRESS: Director - SOPAC Fiji Islander Married South Pacific Applied Geoscience Commission (SOPAC) Private Mail Bag GPO, Suva, Fiji. Phone:(679) 338-1377 Fax: (679) 337-0040 email:alf@sopac.org

QUALIFICATIONS: M.Sc (Hydrogeology), University of Birmingham, UK. 1981 BSc (Geology), Otago University, NZ. 1972 Diploma in Groundwater Studies, Colorado State University, USA 1976 Advanced Management Programme 92, Australian Management Staff College, Mt Eliza 1986 PROFESSIONAL MEMBERSHIP & SOCIETIES: Member of the International Marine Minerals Society (IMMS) Member of the ISBA Legal & Technical Commission (1997 - 2006) Director on the Circum-Pacific Council Chair of the PacificGOOS Steering Committee Member of the SEREAD Steering Committee Member of the Royal Commonwealth Society - Fiji Branch EMPLOYMENT HISTORY: Feb 1998 - to Present Jan 1995 - Feb 1998: Nov 1991 - Jan 1995: Nov 1983 - Nov 1991: Nov 1981 - Nov 1983: Jan 1978 - Nov 1981: May 1972 - Jan 1978: Director SOPAC Deputy Director, SOPAC Secretariat. Director of Mineral Development and Mines, Fiji. Assistant Director of Mineral Development, Fiji . Principal Geologist Mapping-Hydrogeology Senior Hydrogeologist, Fiji MRD. Geologist, Fiji MRD.

Dr RUSSELL HOWORTH POSITION: NATIONALITY: MARITAL STATUS WORK ADDRESS: Deputy Director - SOPAC British / New Zealand Married South Pacific Applied Geoscience Commission (SOPAC) Private Mail Bag GPO, Suva, Fiji. Phone:(679) 338-1377 Fax: (679) 337-0040 email:russell@sopac.org

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Dr Russell Howorth is the Deputy Director at the South Pacific Applied Geoscience Commission based in Suva, Fiji. SOPAC is an intergovernmental regional body with fifteen member, and two associate member governments. Dr Howorth is a geologist and has worked in the region for twenty-two years. He has carried out geological work for all island countries in the South Pacific. He has written over 60 research and scientific papers and 58 other publications. Most of these reflect his work in the small island developing states of the region. Until 1997 he was Training Coordinator at SOPAC, and in that capacity was involved with the career development and opportunities of many young people in the region. A major achievement was the establishment and teaching of the Certificate in Earth Science and Marine Geology. The Certificate brought together SOPAC, USP and Victoria University of Wellington to offer a unique opportunity for an academic course with a practical focus for technicians previously unavailable in the region. Dr Howorth was appointed Program Manger in 1997 and in 2002 as Deputy Director.

PAUL LEONARD FAIRBAI RN POSITION: NATIONALITY: MARITAL STATUS WORK ADDRESS: Energy Manager - SOPAC New Zealand Married South Pacific Applied Geoscience Commission (SOPAC) Private Mail Bag GPO, Suva, Fiji. Phone:(679) 338-1377 Fax: (679) 337-0040 email:paul@sopac.org

QUALIFICATIONS: 1997/8 1996 1980 1980 1978 1977 1976 1972 1971 1968 Financial Economics (Massey University) Diploma in Financial Economics (University of London) Registered Engineer (MIPENZ) Registered Construction Diver Qualified Scuba Diving Instructor NZ Registered Safety Supervisor B.E. Civil Engineering New Zealand Certificate in Drafting New Zealand Certificate in Engineering University Entrance

PROFILE: Ten years professional engineering experience with the Ministry of Works and Development (MWD New Zealand), including design in the electricity / power sector on hydropower and geothermal electricity generating schemes, dam surveillance. Sixteen years operational and management experience in the pacific region initially in the capacity as a hydropower adviser to a national energy programme. Subsequently with the regional energy programme formerly under the South Pacific Forum Secretariat and now based at the South Pacific Applied Geoscience Commission (SOPAC). Providing

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technical advice and services to the Pacific island countries / economies at Ministerial and Energy Planner level including the provision of advice to regional donors and organisations. Representation of the Pacific island countries at regional and international conferences, symposia and technical meetings. Ability to work within a wide range of energy technologies and disciplines, cultures and associated energy sector programmes with an understanding of the climate change negotiation and commitments under the Kyoto Protocol. Motivated, adaptable, diplomatic, fair, culturally sensitive and committed to country requirements, organisation and management, colleagues and clients. Computer literate and proficient at word processing, spreadsheets, database and basic programming.

SKILLS AND ACHIEVEMENTS Human Resources and Leadership Skills Well developed team leadership skills with proven ability to gain confidence and respect of colleagues and staff. Developed and lead an effective team of professional staff, undertaking planning, programme and project implementation, regional and national training and institutional strengthening, and assisting in directing the development of national energy sectors. Highly developed and effective public consultation, liaison, communication skills implemented at all levels of government, management, and regional and international donors and organisations. Work in a wide and diverse range of energy sector environments including Pacific Island Energy Offices, Regional and International Organisations. Networking and cooperation between other relevant regional programmes including associated Units within the parent organisation, SOPAC. Financial and Organisation Management Capabilities in preparing, negotiating, fiscal management and monitoring an annual budget for work programme and project activities. Provision of advice on programmes and projects regarding technical matters including trends, needs identification, resource allocation and financial performance. Establish, monitor and undertake ongoing review of project and programme financial performance targets. A logical and innovative approach to dealing with conceptual, analytical and problem solving situations including the responsibilities for identification of new financing opportunities, programme promotion, prioritisation and coordination, funding for support technical staff. Assisted management in the preparation briefing papers and the documentation for a multimillion-dollar regional project. Programme and project financial reporting annually to member countries and as required to management, donors and other regional and international organisations. Project Management Established and managed an engineering consultancy in the Solomon Islands including providing the Project Management role for a wharf and township infrastructure at Noro. Managed and coordinated effective national and regional energy programmes. Project management experience in capital, demonstration and pilot projects, and preparation of tender documents and appointment of consultants. Provision of technical advice on programmes and projects, state-of-the-art technologies, operational requirements, project management, including financial and economic considerations.

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Experienced in the preparation of project profiles and proposals, memorandum of understanding, terms of reference, tender documents including consultation and definition of brief with key stakeholders. Prepared and successfully secured project funding for a range of projects including, regional wind energy programme, demand side management technical assistance, regional biomass resource assessment. Experience in establishing baseline parameters for project monitoring and management including reporting on the effectiveness and impact of projects and programmes.

Strategic Planning Development of long term strategic plans and programmes through the preparation of logical planning frameworks. The preparation of regional position papers in particular for the Ninth Commission on Sustainable Development (CSD9), focusing on energy and Ministerial briefing papers. Expertise in developing policies and strategies for the energy sector including the development of information and energy database. Assist in the development of national energy policy statements including developing strategies for the implementation of priority energy activities focusing on the reduction of imported fossil fuels through efficiency and conservation projects and programmes and the introduction of renewable energy technologies. Provide planning advice on appropriate technology choices to meet national sector requirements. A range of experience in completing needs analysis and feasibility studies for energy sector development projects and proposals.

ANARE MATAKIVITI POSITION: NATIONALITY: MARITAL STATUS WORK ADDRESS: Energy Adviser - SOPAC Fiji Islander Married South Pacific Applied Geoscience Commission (SOPAC) Private Mail Bag GPO, Suva, Fiji. Phone:(679) 338-1377 Fax: (679) 337-0040 email:anare@sopac.org

QUALIFICATIONS: Qualification: ME (Energy Planning and Policy, UTS 1999); BED (Technology) USP 1988) PROFESSIONAL EXPERIENCE: 2000 1995 1994 1992 1990 Appointed Energy Adviser, SOPAC Appointed Principal Energy Analyst, Department of Energy Appointed Senior Energy Analyst, Department of Energy Appointed Energy Analyst, Department of Energy Appointed Graduate Trainee, Department of Energy

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ENERGY SECTOR EXPERIENCE: Appointed Administrator of the Lome II PV Follow-up Project and coordinated the work undertaken to upgrade about 60 individual solar lighting systems in Namara, Kadavu. Involved in rural energy projects, solar, biomass, hydro, geothermal, wave, wind etc. Coordinate the constructions of two village based hydropower schemes. In 1992 carried a survey of diesel rural electrification schemes that were constructed under the 1973 Rural Electrification Policy. The result led to the review of the rural electrification policy that eventually led to the adoption of the 1994 Rural Electrification Policy. Participated in an urban energy survey carried out by the Department of Energy in 1993. Participated in a Participatory Rural Appraisal for Rural Electrification in two villages in Kadavu to test the approach as a tool for planning, implementing, evaluation and monitoring of rural electrification projects. In 1997 worked with a Forum Secretariat Energy Consultant surveying selected rural villages in Tonga and Fiji to ascertain the impact of rural electrification in electrified villages and at the same time determine what un-electrified villages expectations of electricity. Appointed in 1994 to head the newly established Rural Electrification Unit in the Department of Energy and to oversee the implementation of the new Rural Electrification Policy. Current Responsibilities as Energy Adviser at SOPAC include: Coordinating regional energy development projects and regional initiatives that are implemented under, or have an impact on, the Energy Units Work Program or the energy sectors of member countries; Evaluating and reviewing the socio-economic and technical merits of activities and initiatives in the energy sectors of member countries and providing technical and policy advice where appropriate; Monitoring, appraising and evaluating the technological progress in renewable and conventional energy technologies, energy conservation and efficiency practices and providing the appropriate advice to member countries with the view to transferring the technologies and practices, where appropriate; Identifying the renewable energy potentials in member countries, providing technical, policy and economic advice on how these resources should be extracted and utilized; Conducting, facilitating and coordinating regional and national training activities, seminars and workshops related to the work of the Energy Unit; Appraising project proposals from member countries, coordinating and providing technical assistance on the implementation of their projects under the Small Energy Projects Program; Appraising member countries requests for consultancy assistance. Providing assistance in the drafting of terms of reference and contracts for consultants, monitoring their performance and reviewing their consultancy reports;

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SUMMARY RESUMES OF USGIC GEOSCIENTISTS GERALD W. HUTTRER Gerald W. Huttrer, is President of Geothermal Management Company, Inc. (GMC) a firm that was established in March 1987 as a vehicle through which Mr. Huttrer conducts his geothermal energy, heat pump-related and mineral exploration consulting businesses. He is also (since 1990) President of U. S. Geothermal Industries Corporation, an 18 member consortium of American geothermal firms that collaborate to more effectively sell their goods and services outside the USA. Mr. Huttrer earned his B.A. in geology in 1960 from Dartmouth College and an M.S. i n geology in 1963 from the University of Washington. He worked for 8 years on international and domestic engineering geology and mineral exploration projects and, since 1971, has concentrated almost exclusively on geothermal exploration and development. Mr. Huttrer's has held positions of significant corporate responsibility within the geothermal industry including those of Chief Geologist, Exploration Manager, Vice President-Business Development, Executive Vice President and President. He is a multi-term Director and a past President of the Geothermal Resources Council, a member of the Board of the Geothermal Energy Association, the President of CHS Inc. (a small Colorado energy development company) and is licensed as a geologist and an engineering geologist in California. Mr. Huttrer is also Certified to train installers of geothermal heat pump ground loops and has been the Rapporteur at the 1990 (Hawaii, US), 1995 (Florence, Italy) and 2000 (Beppu and Morioka, Japan) World Geothermal Congresses responsible for summarizing the status of geothermally generated electric power for all of the nations of the world. Mr. Huttrer has had consulting roles in numerous public and private sector geothermal projects including some related to electric power generation, high, medium and low temperature drilling and project development, district and space heating, technical analyes of geothermal heat pump heat exchangers, design of advanced geothermal drills and land evaluations ranging from a few acres to entire (small) countries. He has worked in all of the western United States and in 27 foreign countries. A specialty field for Mr. Huttrer is investigation of the potential for initiation of small-scale geothermal power and/or direct-use projects in developing countries including Fiji, Vanuatu, Papua New Guinea, and New Zealand.

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SUMMARY RESUMES OF GEOTHERMEX PERSONNEL Dr. Subir K. Sanyal, President and Manager of Reservoir Engineering Dr. Sanyal has worked as a reservoir engineer since 1969. His expertise includes project financing and management, economic analysis, property appraisals, reservoir engineering, numerical simulation, training of reservoir engineers, and software development. Dr. Sanyal joined GeothermEx in 1980 as Vice President and Manager of Reservoir Engineering Services, and became President of the company in 1995. Since 1975, he has managed major geothermal projects in the United States, The Philippines, Japan, Costa Rica, Indonesia, Mexico, Nicaragua, Guatemala and Italy. Dr. Sanyal has served as an expert witness in numerous litigations. He has conducted technology transfer programs in Japan, Greece, Bolivia, Brazil and The Philippines, and undertaken assessment of geothermal fields in two dozen countries around the world. Dr. Sanyal has also assisted clients in geothermal power sales and steam sales contract negotiations, property appraisals and market studies, and provided advice and due diligence for project financing in numerous countries. To date, this has enabled the generation of more than 6,000 MW of geothermal power, the total financed being nearly US $7,000,000,000. Dr. Sanyal has a Ph.D. in Petroleum Engineering from Stanford University, and a Master's degree in Petroleum Engineering from the University of Birmingham (England). He serves on the Board of Directors of the Geothermal Resources Council (Davis, California), Geothermal Energy Association (Washington, D.C.) and the International Geothermal Association (Pisa, Italy). He speaks and reads Spanish and can read Russian. He has been author or co-author of more than 100 technical publications. Dr. Sanyal has led teams of specialists in the assessment of many well known geothermal fields; power plants have now been installed at most of these sites. These fields include: The Geysers, Coso, Salton Sea, East Mesa, Heber, Brawley and Mammoth (California); Dixie Valley, Steamboat, Soda Lake, Stillwater, Beowawe, Desert Peak and Bradys (Nevada); Puna (Hawaii), Unalaska (Alaska); Momotombo and San Jacinto (Nicaragua); Miravalles (Costa Rica); Zunil and Amatitln (Guatemala); Ahuachapn and Berln (El Salvador); Olkaria (Kenya); Tiwi, MacBan, Palinpinon, Leyete and BacMan (Philippines); Dieng, Patuha, Wayang Windu, Karaha, Kamojang and Darajat (Indonesia); Uenotai, Wasabizawa, Minami Aizu, Oku Aizu, Hakkoda, Kokubu, Takigami and Niseko (Japan); Latera and Mofete (Italy); Wairakei and Ohaaki (New Zealand); Asal (Djibouti); Kochani (Yugoslavia); Zugdidi (Republic of Georgia); and so on. Before joining GeothermEx in 1980, Dr. Sanyal was a Consulting Professor and Manager of the Petroleum Research Institute at Stanford University, Vice President of Geonomics, Inc., Senior Staff Specialist for the United States Geological Survey, Consulting Engineer for Scientific Software Corporation, and a Senior Petroleum Engineer for Texaco, Inc. Eduardo E. Granados, Vice President and Manager of Drilling Services Mr. Granados has been active in geothermal exploration, drilling, and well testing continuously since 1975, and joined GeothermEx in 1984. His expertise includes geothermal well design and drilling engineering, design and supervision of geothermal well tests; specification and design of instrumentation for production wells; supervision of drilling and workover of geothermal wells; design and supervision of construction for civil works (pads, roads, sumps); preparation of drilling specifications and bid documents; and permitting and coordination with government regulatory agencies.

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Mr. Granados has a Master's degree in Petroleum Engineering from Stanford University and a Bachelor's degree in Civil Engineering from the University of Costa Rica. He has also been trained at the United Nations Center for Geothermal Research in Pisa, Italy. He speaks, reads and writes Spanish, and speaks and reads French and Italian. Mr. Granados has worked on all aspects of geothermal well drilling, well control, testing, data analysis and the construction of surface facilities in numerous geothermal fields around the world. In the United States, Mr. Granados has provided such services at the following fields: The Geysers, East Mesa, Mammoth, Coso and Heber in California; Soda Lake, Steamboat, Rye Patch, Gerlach and Bradys in Nevada; Puna in Hawaii, and Vail in Oregon. Overseas, Mr. Granados has provided drilling or well testing services at the following fields: Wayang Windu, Dieng and Patuha in Indonesia; Uenotai in Japan; Zugdidi in Georgia; Lihir Island in Papua New Guinea; Cerro Prieto in Mexico; Zunil and Amatitln in Guatemala; Berlin in El Salvador; Momotombo in Nicaragua; Miravalles, Ricon de la Vieja and Tenorio in Costa Rica; and Valle de Anton in Panama. Prior to joining GeothermEx, Mr. Granados worked for Instituto Costarricense de Electricidad (ICE, the Costa Rican national utility) from 1975 to 1984. During that time, he was responsible for drilling, well testing and civil engineering at Miravalles geothermal field. He designed and supervised the drilling of nine deep full-diameter wells and 46 temperature core holes, conducted numerous well logging and testing programs, negotiated with drilling contractors, managed drilling budget, designed civil works and supervised the construction of well pads, roads and camp facilities. In addition to his engineering skills, Mr. Granados has given numerous lectures and short courses in the U.S., Central America and South America on drilling, well testing, geothermal resource assessment and regulatory issues. In addition, he has participated in devising appropriate regulations to govern geothermal development in several countries. Roger C. Henneberger, Manager of Earth Sciences Mr. Henneberger has been a geologist with GeothermEx since 1984. His expertise includes: planning and management of geothermal drilling and well testing programs; technical and financial control of geothermal development and operations; design, coordination and implementation of wellsite geology, well testing, instrumentation and downhole measurements in geothermal wells; geological, statistical and economic assessment of geothermal resources; well targeting and design of directional drilling programs; design and management of computerized data bases; development of analytical and financial software; assessment of geological hazards; permitting and regulatory compliance; detailed petrographic and petrologic analysis (transmitted and reflected light microscopy, x-ray diffraction, electron microscopy, clay mineralogy, chemical analysis, fluid inclusion studies); and geochemical sampling. Mr. Henneberger was awarded a Fulbright Scholarship to study geothermal energy in New Zealand, and received an M.Sc. degree in Geology with First Class Honors in 1983. He also has a B.S. degree in Geology, which he earned from Stanford University in 1978. Roger speaks, reads and writes Spanish, and can read and speak German and Portuguese. Major accomplishments include: planning and managing the drilling and workover of six deep (to 11,400 feet) steam wells in the northwest part of The Geysers geothermal field; assessment of the technical and financial status of drilling and development operations at the Cerro Prieto geothermal field in Mexico; wellsite geology and technical monitoring of drilling operations at numerous geothermal fields; well testing, downhole measurements and geochemical sampling at Brady's Hot Springs, Steamboat, Coso, Amatitln

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(Guatemala), The Geysers, Gerlach, Dieng (Indonesia), Lihir Island (Papua New Guinea) East Mesa, Fish Lake Valley, and So Miguel (the Azores); design and supervision of temperature gradient and slim hole drilling programs at several locations in California, Nevada and Oregon; economic evaluation and cash flow analysis of existing and proposed geothermal operations in the US and overseas; and planning and supervision of the drilling of more than 10 succes sful steam wells, and developed a detailed model of the subsurface geology in leases held by NCPA at The Geysers. Prior to joining GeothermEx, Roger was a Field Geologist for Noranda Exploration in Reno, Nevada, where he performed geologic mapping and core logging at a molybdenum prospect. As an Associate Geologist for Fluor Mining and Metals, Roger estimated ore reserves and developed computer-based systems for ore deposit simulation using modern geostatistical techniques. At the U.S. Geological Survey in Menlo Park, California, he developed a comprehensive computer package for storing, manipulating and interpreting data from geodetic leveling surveys. Ann Robertson-Tait, Senior Geologist / Business Manager Ms. Robertson-Tait has been a permanent employee of GeothermEx since 1985. Her expertise includes: interpretation of downhole data from geothermal wells; development of conceptual hydrogeologic models from multi-disciplinary data; determination of recoverable geothermal energy reserves; risk analysis; integration of geoscientific and engineering analyses to solve resource development and management problems; project management, scheduling and budgeting; preparation of proposals; and marketing and public relations. Ms. Robertson-Tait was awarded a Fulbright Scholarship to study geothermal energy in New Zealand, and received a Master's degree in Geology from the University of Auckland in 1984. She received her B.S. degree in Geology from Florida Atlantic University in 1981, and can speak and read Spanish and French. Since joining GeothermEx, Ann has specialized in the integration of geological, geochemical, geophysical data to develop conceptual models and estimate the recoverable geothermal energy reserves for numerous geothermal fields around the world. Recent examples include: Karaha - Telaga Bodas, Indonesia; Wasabizawa, Japan; Patuha, Indonesia; Puna, Hawaii; Mammoth (Long Valley), California; Steamboat, Nevada; Latera, Italy; Uenotai, Japan; Dixie Valley, Nevada; Cerro Prieto, Mexico; and Amatitln, Guatemala. Ann has compiled steam production data, evaluated productivity decline trends and assessed injection benefits at The Geysers steam field, California, for areas of the field operated by Calpine Corporation, Santa Fe (now FPL Energy), Geo Operator Company (CCPA), Unocal, NCPA and Geothermal Energy Partners (Aidlin). She has also analyzed production data for compliance with bank financing requirements at The Geysers, Mammoth (Long Valley), Salton Sea, Coso and East Mesa (all in California); Dixie Valley, Soda Lake, Stillwater and Empire (Nevada); and Puna (Hawaii). Prior to joining GeothermEx, Ann was a Research Associate for the Ministry of Works and Development in Taupo, New Zealand, where she compiled, converted and analyzed 25 years of leveling survey data to develop an accessible, organized database. This work included the use of geodetic computer programs for coordinate transformation and survey network adjustment. She also worked as an Associate Hydrogeologist for the South Florida Water Management District, doing pump test analysis of groundwater wells, water sampling and mapping for a salt water intrusion monitoring program, and compilation and analysis of long term water-use data from agricultural, municipal and industrial users.

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Dr. Christopher W. Klein, Senior Geochemist Dr. Klein has been the senior geochemist at GeothermEx since 1974. His expertise includes geochemistry, geology, hydrogeologic modeling, interpretation of downhole data from geothermal wells and of chemical data from well tests, integrated with reservoir engineering data. Dr. Klein has a Ph.D. in Geology from Harvard University and a Bachelor's degree in Chemistry from the University of California, Berkeley. He speaks, reads, and writes Spanish. His geochemical expertise includes the fluid and isotope chemistry of geothermal systems, fluids sampling, sampling equipment design and fabrication, field analysis systems and laboratory design, set-up and management, training in sampling and analysis methods, lecturing on geothermal chemistry, fluids chemistry database and spreadsheet software, fluids chemistry thermodynamic modeling software, scaling and corrosion studies, scale inhibition and control, tracer testing, and the relationships of resource evaluation and resource management to geology, geochemistry, well testing, well logging and hydrogeologic modeling. He has worked on geothermal geochemistry in nearly every country with geothermal resources around the world, including the USA (The Geysers, Imperial Valley, Coso, sites in Nevada), Japan, Indonesia, Guatemala, Costa Rica, Honduras, Panama, Philippines, Iran and Papua New Guinea. His geological experience includes structural geology, mineralogy, hydrogeology and well drilling. Examples of his recent experience include a study of non-condensable gas evolution at the Uenotai geothermal field in Japan. He designed a fluorescein tracer test, purchased equipment, did tracer analyses and trained local personnel in tracer injection, sampling and analysis procedures at the Volcan do Fogo geothermal field, Sao Miguel, Azores. He evaluated and quantified Zn concentrations in relation to chemical equilibria, brine composition and temperature, to support a numerical simulation of long-term Zn production and extraction at the Salton Sea geothermal reservoir, Imperial Valley, California. He conducted fluid chemistry sampling and analysis, database management, field lab design, set-up and personnel training, well test monitoring and hydrogeochemical modeling at the Dieng, Patuha and Wayang Windu geothermal fields in Indonesia. He developed chemistry database software and chemical equilibrium thermodynamics software design, installation and training, for use by Akita Geothermal Energy Company in its operation of the Uenotai geothermal field, Japan.

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SUMMARY RESUMES OF GEOTHERMAL DEVELOPMENT ASSOCIATES PERSONNEL G. MARTIN BOOTH III Geologist/President EDUCATION: M.S. Geology, 1965 - Mackay School of Mines, University of Nevada-Reno Reno, Nevada B.S. Geology, 1957 - Franklin & Marshall College Lancaster, Pennsylvania PROFESSIONAL REGISTRATION, CERTIFICATION & MEMBERSHIPS: State of CaliforniaRegistered Geologist No. 192 Association of Professional Geological Scientists Certified Professional Geologist No. 1590 American Association of Petroleum Geologists Certified Petroleum Geologist No. 1110 American Association of Petroleum Geologists Energy Minerals (Geothermal, Coal, Nuclear, etc.) Geological Society of America Geothermal Resources Council International Geothermal Association PROFESSIONAL EMPLOYMENT: November 1978 to Present President and Director, Geothermal Development Associates, Reno, Nevada. Directs and Coordinates the companys activities; major areas of work and research are in geothermal resources and geology. June 1968 to Present Consulting Geologist, Reno, Nevada, in petroleum and mineral resources; exploration and mineral property assessment; emphasis on the intermountain region of Nevada, Utah, and California. Clients: private companies, investment groups, and individuals; Federal and Nevada State government agencies; utilities. June 1960 to June 1968 Exploration and Project Geologist with The Superior Oil Company and Superior Oil International, Inc. in Denver, Colorado; Tripoli, Libya; and Houston, Texas. Responsibilities included oil and gas prospect generation, well site supervision, field mapping, photogeologic/geomorphic mapping, oil submittal evaluation, regional geologic studies, economic evaluations, joint venture operations, project management and coordination of foreign and domestic petroleum exploration projects. Summer of 1957 Underground Miner, New Jersey Zinc Company, Ogdensburg, New Jersey. Summer of 1956 Field Geologist, International Nickel Company, Ely, Minnesota.

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DAVID L. MENDIVE, P.E. Electrical Engineer/Vice President EDUCATION M.S. Electrical Engineering, 1975 B.S. Electrical Engineering, 1973 New Mexico State University Las Cruces, New Mexico University of Nevada-Reno Reno, Nevada

PROFESSIONAL REGISTRATION, CERTIFICATION & MEMBERSHIPS Professional Engineer - Nevada #4851 (Electrical) and California #9117 (Electrical) Institute of Electrical & Electronic Engineers, Former Reno Subchapter Officer Geothermal Resources Council, Former Reno Subchapter Chairman U.S. Geothermal Industries Corporation, Board of Directors PROFESSIONAL EMPLOYMENT 1978 to Present: Vice President, Geothermal Development Associates, Reno, Nevada. Responsible for supervision and coordination of all engineering work performed by GDA, including professional consulting services provided to GDA clients, as well as work performed for GDAs own account as developers of geothermal energy resources. This work has included power contract (PPA) development, review, and negotiations; utility interconnection studies and negotiations; power system design and analysis; power market evaluation and load projections; formulation of economic models and development plans; technical review and support in relation to project financing; project management; project start-up supervision; operator training; electrical engineering; instrumentation and control system design. Other experience in this time frame includes part-time teaching of power systems and network analysis courses at the University of Nevada-Reno, Electrical Engineering and Computer Science Department, and manufacture of custom controls and instrumentation. September 1977 to July 1978: Research Associate, New Mexico Solar Energy Institute. Half-time research assignment to Division of Modeling and Analysis, primarily involved in wind and photovoltaic systems. Staff Engineer, New Mexico State University, Department of Electrical and Computer Engineering. Half-time assignment teaching undergraduate course in electromechanical energy conversion. May 1977 to September 1977 Electrical Engineer II, State of Nevada, Nevada Public Service Commission. Primary responsibility was to advise and assist the Commission in matters relating to electric utility regulation. Performed technical review of several utility applications for construction of generation, transmission, and distribution facilities. April 1976 to May 1977: Consultant. Contract with the State of Nevada to perform the first comprehensive study of energy consumption in Nevada. The study entailed the collection and analysis of historical energy consumption data (electrical, natural gas, coal, petroleum, etc.), and the development of long-range forecasts of consumption for each energy form in the major consumption sectors. The final report, entitled Energy in Nevada, was printed in June 1977. September 1975 to December 1975: Research Assistant. Department of Electrical and Computer Engineering, New Mexico State University. Assignment as a half-time research assistant to the joint NMSU-Los Alamos super conducting dc transmission project. July 1973 to August 1974: Electrical Engineer I, State of Nevada, Nevada Public Service Commission. Primary responsibility was to advise and assist the Commission in matters relating to the regulation of electric utilities.

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