Basic Energy Corp. received the green light from the Energy Department on a farm-in agreement with Trans-Asia Oil and Energy Development Corp. to jointly develop a geothermal service contract in Mabini, Batangas.
Basic Energy said in a disclosure to the Philippine Stock Exchange it obtained the go-signal early this week.
The approved arrangement calls for a 75-25 equity and project cost participation between Basic Energy and Trans-Asia. Under the terms of the agreement, Trans-Asia will shoulder a 25-percent undivided participating interest in the rights, interests, privileges, duties and obligations in and under geothermal service contract No. 8.
Trans-Asia decided to share in the cost of the first exploration well committed under sub-phase 3 of the geothermal service contract after undertaking due diligence on the project, including geophysical work. This validated previous prospective estimates that the project could generate between 20 megawatts and 60 megawatts of energy.
Basic Energy, as the operator of the service contract, plans to drill the first well by the second quarter of next year.
Basic Energy early this year signed an agreement with FECD Energy Resources and Development Services to review and evaluate existing data and the geological and geochemical survey of its geothermal power projects.
Basic said the data would come from the East Mankayan Geothermal Power Project, Mariveles Geothermal Power Project, Iriga Geothermal Power Project and West Bulusan Geothermal Power Project
Under the services agreement, FEDS will conduct the review and evaluation of existing data and the reconnaissance geological and geochemical field work of the power project areas to assess their technical viability.
“The work is estimated to be completed in three months time. The results of the study will assist Basic in planning for the detailed surface exploration phase,” the company said.
FEDS is a local technical management and consultancy company with expertise in energy and natural resource exploration, exploitation and production, including minerals, oil and gas, coal, cabled methane, geothermal and other renewable energy sources.
Its core group of geoscientists has over 30 years of experience in pre-exploration, exploration and production projects.