U.S.-Icelandic Company to Develop $4 Billion Geothermal Project in Ethiopia

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--Reykjavik Geothermal, a U.S.-Icelandic (Reykjavik/New York) development company, has signed an agreement with the government of Ethiopia to develop 1,000 megawatts (MW) of geothermal power in the northeast African country. The investment in the project is approximately $4 billion.

Reykjavik has been working with the Ethiopian Electric Power Corporation (EEPCO) and government ministries for the past two years to finalize the power purchase agreement. The first 500-MW plant will be built inside the Corbetti Caldera, considered to be one of the top geothermal sources in the world by geoscientists who have studied the area.

The project will be built in two phases, each including a 500--MW plant, over the next eight to 10 years. The first plant is scheduled to be fully operational by 2018. The first phase will see 10 MW by 2015 and 100 MW by 2016. EEPCO has agreed to purchase the entire output from Corbetti for 25 years.

The Ethiopian prime minister said that his vision over the next 30 years is for the country to harness as much as 80,000 MW of hydro, geothermal, wind and solar power for the region, in partnership with the private sector. The deputy prime minister and EEPCO chairman Dr. Michael Debretson said the government believes that the country has more than 10,000 MW of geothermal potential, which could provide base load power and offer a perfect complement to meet more than 50,000 MW of hydropower potential.

The geothermal project combines Ethiopia's power generation experience with Iceland's geothermal project knowledge and the financial and structuring expertise of the U.S.

For related information, see September 11, 2013, article - Global Geothermal Growth offer U.S. Technology and Expertise Big Opportunities.

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