Polaris Renewable Energy Inc T.PIF

Alternate Symbol(s): RAMPF

Utilities Utilities - Independent Power Producers

Polaris Renewable Energy Inc. is engaged in the acquisition, development and operation of renewable energy projects in Latin America. It operates 82 megawatts (MW) geothermal facility in Nicaragua, three run-of-river hydroelectric facilities in Peru, with a combined capacity of approximately 33 MW, a 25 MW solar plant facility in Dominican Republic, a six MW run-of-river hydroelectric facility in Ecuador and a 10 MW solar plant in Panama. Through its subsidiary, Emerald Solar Energy SRL, it operates the Canoa I Solar Park located in the Barahona Province, Dominican Republic. Its San Jacinto-Tizate Geothermal plant is located in northwestern Nicaragua, in the sire of San Jacinto, municipality of Telica, 20 kilometers from the city of Leon. Its Vista Hermosa Solar Parks are located in the village of Vista Hermosa, Corregimiento de Pueblos Unidos, Aguadulce district, Cocle Province. Through its subsidiary Generacion Andina SAC, it owns 8 de Agosto, a Run of River hydroelectric operation.

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Polaris Renewable Energy Inc

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Comment by greenandgoldon Apr 12, 2011 3:32pm

294 Views

Post# 18420783

RE: RE: RE: RE: Perspective on Overruns

Because there no big surprises out there! It's not like gold mining, where all of a sudden a promising deposit is evaluated as being uneconomic, or where falling commodity prices could sabotage operating margins.

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In the geothermal industry, every geothermal property that's been properly vetted (feasability studies, modelling, PPA agreements) eventually is put into production and becomes profitable over the long term. Every one of them, that's a historical fact. Therefore, if history holds true, all of RAM's advanced stage properties with PPA's, already vetted internally and by consultants and by major utility companies, will become producing power plants. The odds are overwhelming that San Jacinto, Geysers, Orita, and Clayton Valley will all become power plants.
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Think there's going to be a press release next week: "Sorry guys, all the studies were wrong, San Jacinto can't support a geothermal power plant, we're selling the turbines and heading home to Canada"? It's not happening.
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Am I annoyed by cost overruns? Sure, but should it have been a surprise? No, geothermal drilling is always difficult and costly. And Ram hasn't been doing that bad a job, certainly not bad enough to be punished by the market like this:
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3 wells drilled at Orita: 1 successful (8 to 10MW), 1 completely failed, 1 moving towards completion.
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4 wells drilled at SJT 2: 1 moderately successful (5.3 MW, being acid wash towards 8MW), 1 re-drilled successfully (5 to 10 MW), another 1 moderately successful (4MW estimate, with re-drilling hoping to double that), and 1 completely failed.
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7 wells drilled, and 2 of them are totally unsuccessful. Certainly not a great record, but not so bad that I start to worry about the future of the company.
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Ram doesn't need any miracles to make a very fast comeback with its stock price. Well 12-1 is estimated to certify for 5 to 10 MW next month. Certify that one well for 5MW and the company gets $70 million dollars. That's half the current market cap. The stock will erase a lot of recent losses with that news.