Energy Development Corporation is acquiring a 70 percent stake in a geothermal project in Peru from Hot Rock Limited (HRL) of Australia.
In a disclosure to the Philippine Stock Exchange, EDC said it is taking a 70 percent stake in Geotermica Quellaapacheta Peru SAC (Project Company) which was established in Peru by EDC and HRL to jointly develop the Quellaapacheta Autorization.
EDC's investment in the project was made through EDC Geotermica SAC which had signed a shareholders' agreement with Hot Rock Peru S. A.
The project agreements require Hot Rock Peru to transfer the Quellaapacheta Authorization to the Project Company and this was officials completed last April 15.
After this, EDC has paid Hot Rock an initial US$400,000 which is refundable in the event that EDC withdraws from the project within six months from the transfer date.
A final payment of US$600,000 will be made 15 months from the transfer date if the project is pursued by EDC.
Last year, EDC signed an agreement with Hot Rock, giving EDC the option to take over the latter's projects in South America. Besides Peru, the two also have geothermal projects in Chile.
EDC is now the world's largest integrated geothermal energy producer with its portfolio of steam fields and power plants in the Philippines.
It has a power generating capacity of 1,130 megawatts from its geothermal facilities but is looking abroad for expansion because of limited local prospects.