Nevada Geothermal fixes the problem

The operational problems at Nevada Geothermal’s (NGP-V, NGLPF-O) Blue Mountain project in Nevada are at an end and the company enjoyed a jolt of market confidence on the news.

NGP shares were up 10% over the last to days to reach 83¢ on Mar. 4 in Toronto. The company’s shares had closed at a six month low of 75¢ just two days earlier.

That low came after its stocks began a steady decline to start the year as operational problems dogged its key geothermal electricity plant in Nevada.

The company announced, however, that it has now increased power production from the Faulkner 1 geothermal plant at Blue Mountain to 26 megawatts (MW) from the meager 13 MW it has been operating at for over a month.

Recent problems at the generator had to do with a short circuit in its safety controls which led to a plant shutdown in late January.

At that time the cause of the malfunction was unknown.

NGP brought in experts from its EPC contractor who found that power cables leading out from the control room weren’t configured properly. That poor configuration led to over-heating and then cable failure.

The company now says permanent cables to turbine generator 1 and 3 have been installed with full repairs at generator 2 to be finished by March 10.

Once that happens, the plant will again be fully operational.

But Nevada Geothermal won’t be satisfied with achieving prior production levels.

The company has recently drilled and tested two new deep injection wells that it says will bring production up to the 36 to 40 MW range shortly after it reaches full service. A third well will also likely feed production in the near future.

The test results from the three new wells will be worked into a resource update report that is due out by the end of March.

The company says its production pipeline and electrical connections will take roughly 2-and-a-half months to complete. Which would put the 40 MW produciton target in effect by the end of June.

NGP currently has four key properties: Blue Mountain, Pumpernickel, and Black Warrior, all in Nevada and Grump Greyser in Oregon. The company is targeting the production of over 200 MW from the four projects.