U.S. Geothermal is primarily engaged in the development, acquisition, and utilization of geothermal resources for the generation of electrical power and for sustainable direct use applications. The company strives to enhance shareholder value by addressing energy needs both domestically in America and abroad, while also promoting a clean environment.
Geothermal energy is energy that results from the temperature gradient between the surface of the crust of the Earth to that closer to the Earth’s interior. The geothermal gradient, which is the difference in temperature between the core of the planet and its surface, drives a continuous conduction of thermal energy in the form of heat from the core to the surface. About 20% of the higher temperatures within the Earth are the result of heat that became trapped during the formation of the Earth, and the bulk of the heat, 80%, comes from the decay of radioactive elements within the Earth.
At depths of 80 kilometers (49.7 miles) to 100 kilometers (62.1 miles), temperatures can be as hot as 4,200 degrees Celsius (7,592 degrees Fahrenheit). The deepest we drilled into the surface of the Earth was in 2011, offshore the Russian island of Sakhalin, at over 12 kilometers (around 7.5 miles). The heat source is primarily magmatic systems deep within the Earth’s crust and there is a constant movement of thermal energy that travels outward through highly permeable fracture zones to the surface. Geothermal power is cost effective, reliable, and sustainable, but typically is limited to areas near tectonic plate boundaries. Geothermal energy production does release some greenhouse gases from the Earth, but a mere five percent of the greenhouse gas emissions emitted from fossil fuels, so it is very environmentally friendly.
Two main systems of geothermal electricity production are in use. One that is rarely used is a vapor-dominated system taking advantage of heated ground water that is already present in the earth, such as hot springs, and piping that into a turbine for electricity production. The vapor-dominated system operates in temperature ranges that are above 235 degrees Celsius (455 degrees Fahrenheit). The other pipes in hot water to be heated by the hot source in the ground, and again the water is converted into steam which pushes a turbine that spins a generator, and this more common system operates with water temperatures in the range of 100 degrees Celsius (212 degrees Fahrenheit) to 300 degrees Celsius (700 degrees Fahrenheit).
Currently, U.S. Geothermal Inc. is operating geothermal power projects at Neal Hot Springs, Oregon, San Emidio, Nevada and Raft River, Idaho. In addition to this newly acquired Geysers development project, the company is currently developing a second phase project at San Emidio Nevada, as well as developing the El Ceibillo geothermal prospect located within a 24,710 acre (100sq km) energy rights concession area in Guatemala, located 8.5 miles (14 km) from Guatemala City, the largest city in Central America.
U.S. Geothermal, Inc. also recently acquired the Geyser’s project of Ram Power Corporation located in the Mayacamas Mountains of Sonoma County, California, approximately 12 miles north of the City of Healdsburg for $6.4 million in cash. The acquisition of the Geyser’s project gives U.S. Geothermal five completed enhanced geothermal production/injection wells which have enough steam production for about 30 Megawatts of power. Enhanced geothermal production/injection (EGP) geothermal wells are drilled to about 10,000 feet deep, and have cooled water injected deeply into the ground via a process called hydro-shearing, the water then travels in fractures in the deep rock, the water then gets heated and is forced out a separate borehole where it has become steam and is used once again to push a turbine, after which the water is cooled and sent back into the ground. The advantage of enhanced geothermal systems is that it does not require naturally occurring hydro-convective resources. MIT’s Institute of Technology estimated that enhanced geothermal technology can provide up to 100 Gig Watts of geothermal power.
US Geothermal reported a net profit of $1.9 million on $28.8 million in total sales in the twelve months ending March 2014. At the end of March 2014, US Geothermal reported a total of $204.5 million in tangible assets or $1.97 per share of which $0.38 is in the forms of cash and financial assets. At around $0.65 per share, the company is trading at about 33% of tangible book value. U.S. Geothermal, Inc. appears to be a tiny gem that is both overlooked and undervalued.
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