The company was scheduled to start new drilling near Patua Hot Springs, east of Fernley, Nev., this week, with construction of a 60-megawatt power plant projected to begin in January, said Bob Warburton, Vulcan’s acting CEO.
Founded in 1991, Vulcan holds leases on about 170,000 acres of federal and private land in five states, giving it one of the largest portfolios of geothermal properties in the nation, according to the Geothermal Energy Association, an industry group.
A recent infusion of $108 million from Denham Capital, a private investment firm, will get the drilling started, Warburton said.
While it’s headquartered in Bend, Vulcan houses engineering and other operations in Reno and Fallon, Nev.
The company employs 49 people, but will be adding about 50 to 60 more to drilling crews over the next several months, Warburton said.
The company does not expect to add staff at the headquarters, located near Colorado and Columbia avenues.
Vulcan has several other projects in development, and in October, the company received a $3.8 million grant, which it must match, from the U.S. Energy Department to research methods for finding hidden geothermal reservoirs with potential to generate commercial power.
Fueled by government policies, geothermal energy development has soared in recent years.
After reporting no increase in geothermal electricity capacity from 2001 to 2004, the U.S. reported 3.5 percent growth in both 2007 and 2008, according to the Energy Department.
Last year, it grew 6 percent, with six geothermal plants coming online.
In 2009, geothermal accounted for about 2,800 construction-related jobs and 750 new full-time jobs, according to the Geothermal Energy Association.
“We feel very good about being in this market right now,” Warburton said.
Vulcan’s plans call for a second 60-megawatt geothermal plant at Patua, with additional 60-megawatt plants at three other sites in Nevada, the location for 85 percent of the company’s holdings.
Nevada, which has 21 operating geothermal power plants, has more projects in development than any other state, according to the association.
“It has become … a focal point for geothermal energy in the Western United States,” Warburton said.
Nevada and California increased their future requirements for renewable energy in 2009. The federal government started a loan program to fund innovative technology in geothermal and opened up other renewable energy financing, and the Bureau of Land Management has been selling geothermal leasing rights on federal land for several years.
Between June 2007 and November 2009, the agency sold leases on more than 723,000 acres in six Western states, reaping more than $73 million.
The BLM is currently conducting an environmental impact statement on a 127-acre site east of Fallon, where Vulcan proposes to build up to six 30-60 megawatt geothermal power plants. The review will also cover proposals by two other companies, one seeking to build a geothermal plant and the other requesting right of way for transmission lines.
“We think there’s a lot more there,” Warburton said. “We’ll find out as we continue drilling.”
Vulcan also has made sure it has customers for the power it expects to produce. It has contracts to supply power to two major utilities in California and Nevada and is presently negotiating a third contract, Warburton said. He could not name the company involved, but he expects negotiations to conclude in six to eight weeks.
Along with its lease holdings, Vulcan has branched into other aspects of geothermal exploration. It has a proprietary interest in software, started its own drilling company and has built its own crew to cement the wells, work previously done by a company out of Bakersfield, Calif.
Vulcan also has an application before the Public Utilities Commission of Nevada to erect a nearly 350-mile transmission line, which would start east of Reno and extend to Las Vegas, although Warburton said the proposal is on hold.
Right now, he said, Vulcan wants to concentrate on producing electricity.
“We prefer to utilize our capabilities to get our power plants built,” Warburton said.
Tim Doran, Bend Bulletin – http://www.bendbulletin.com/apps/pbcs.dll/article?AID=/20100211/BIZ0102/2110365/-1/RSSNEWSMAP