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Western GeoPower Corp.
(WGP-TSXV)
Fact Sheet
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While Still Developing Their Large South
Meager Geothermal Project In BC Canada, Western GeoPower Has Expanded Their
Original Vision By Acquiring 1000 Acres Of Leasehold In The Most Productive
Geothermal Field On Earth In The Geysers Field, In California
Energy
Renewable Energy
(WGP-TSXV)
Western GeoPower Corp.
Suite 400, 409 Granville Street
Vancouver BC Canada V6C 1T2
Phone: 604-662-3338
Kenneth MacLeod
President and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
Published – March 21, 2008
BIO:
Kenneth MacLeod
Kenneth MacLeod has been President and CEO and a member
of the Board of Directors of Western GeoPower since his appointment in 2001.
He has been Acting Chairman since September 2005.
With a goal of establishing Western GeoPower Corp as one of the top
geothermal development, and exploration companies in North America; MacLeod
has aligned the company with strong strategic investors and obtained prime
projects such as the 2006 acquisition in The Geysers Field in California.
MacLeod brings over 27 years of leadership and business experience in
international resource exploration and development and has been instrumental
in raising over C$100,000,000 in financing for his companies, including
C$57,000,000 in financing for Western GeoPower. His experience in the areas
of corporate management, corporate finance, project management and
administration has been instrumental in directing the growth of Western
GeoPower to its position of being one of approximately ten geothermal
companies in the United States perfectly positioned to take full advantage
of a projected five-fold increase in geothermal capacity over the next
fifteen years.
MacLeod has built an experienced Management Team, an accomplished Board of
Directors, combining with that expertise from leading geothermal industry
experts and consultants.
Prior to joining Western GeoPower Corp. from 1980 to 2001, MacLeod acted as
senior officer and director of several resource companies operating in North
America, Asia and Africa. From 1984 to 2001, he was President of Kakanda
Development Corp., one of the first foreign mining companies to operate in
the Democratic Republic of Congo. Prior to his involvement in resource
development, from 1974 to 1980, Ken was an independent engineering
consultant engaged in the design and construction of industrial facilities
related to the resource sector.
Company Profile:
Western GeoPower Corp. is a
renewable energy company dedicated to the development of geothermal energy
projects for the delivery of clean, sustainable, baseload electricity
generation. The Company is developing a 35 Megawatt (net) geothermal power
plant at The Geysers Geothermal Field in California, United States. Western
GeoPower is also developing the South Meager Geothermal Project in British
Columbia, Canada.
CEOCFO: Mr. MacLeod, what was your vision when you became CEO of Western
GeoPower in 2001, and where are you today?
Mr. MacLeod: “The
initial vision for Western GeoPower in 2001 was to develop the South Meager
Geothermal Project in Canada as Canada’s first geothermal power project for
the production of electricity. Since that time while we have made
significant strides forward to evaluate and determine the commercial
viability of the South Meager project, it still remains to be seen as to
what the ultimate signs of the power plant will be whether it is 25
megawatts, or even 250 megawatts or somewhere in-between. We still hold to
our 2001 vision and very distinctly because the South Meager project is a
large geothermal project by world standard. Therefore, we feel very
confident as we continue to test the wells that we have drilled there that
we will have a commercially viable project, and with the way that the power
prices have been increasing over the past two or three years, the project
becomes more valuable as time goes by. However, since that time our vision
has expanded, we have moved into California and have acquired over 1000
acres of leasehold in the most productive geothermal field on earth in the
Geysers Field north of San Francisco. We are in the process of developing a
35-megawatt power plant at that particular site to come on line in early
2010. Consequently, we have decided that California is a very attractive
place to do business in the Geothermal sector because of the fact that it is
recognized as the most productive area for geothermal development in the
world with almost 30% of the world production being focused within
California. In addition, California deriving about 6% of its power from
geothermal energy with the goal of achieving as much as 20% off its power
from geothermal energy over the next 20-25 years so we want to be a
significant contributor to that 20% projection.”
CEOCFO: What is
special about geothermal?
Mr. MacLeod:
“Geothermal energy is truly a renewable and sustainable resource. It is
created as a result of the magma in areas of recent volcanic activity, by
recent I mean in the past two million years. Where you have the magma
relatively close to the surface, the magma heats the basement rock, which
then heats the water that flows in faults and fractures throughout the
basement rock. Then in turn we drill into these fractures to extract either
the steam or the hot water, which comes to surface and powers the turbine
and then the hot water is then cooled down sufficiently to enable us to
inject it back into the reservoir. Then it is also the only renewable
baseload generation, in other words it has a 95-99% capacity factor. It is
effectively on line 24/7 producing the same energy without fluctuations year
after year. You know what your price is going to be when you drill your
wells. You determine what your cost will be for the life of the project
because the drilling of these wells is in essence paying for your energy or
paying for your fuel upfront. It is very similar to building a hydro dam,
where you sink a lot of cost into building the dam but after that the energy
is essentially free from that point onward except for the operating and
maintenance cost. The utilities especially in California where the demand is
very high for geothermal, rely on geothermal energy because it does not
impose any stresses on the dispatch ability of the power for example with
wind when the wind doesn’t blow there is no electricity being produced.
Geothermal energy is very reliable and it carries a premium because of the
fact that it is so reliable and it does provide base load generation.”
CEOCFO: Are you
selling to the utility companies?
Mr. MacLeod: “We are
selling to the utilities such as in California, Southern California Edison,
Northern California Power Agency and San Diego Gas & Electric. These are all
major utilities that are very keen on buying as much geothermal energy that
they can, not just for them to meet that renewable portfolio of standard,
but also for the fact that it is reliable generation. They know what the
price is going to be today and they know what the price is going to be
twenty years down the line. When you secure a power purchase agreement from
Geothermal Energy, your costs are fixed for the term of the power purchase
agreement. Twenty years down the line you know exactly what that power is
going to cost therefore the utilities can plan for twenty and sometimes
forty years down the line as to what the costs are going to be.”
CEOCFO: What is the
timetable over the next couple of years to get up and running, and are there
challenges to the completion of your plans?
Mr. MacLeod: “There
are always challenges. This one would be environmental and regulatory, and
permitting. Even in the Geysers Field in California where our project site
was the scene of a larger 62 megawatt power plant that operated between 1979
and 1989, the legacy of which the drill paths are in excellent position and
still in place. The wells were plugged and abandoned but we would rather
build new wells anyhow with modern technology. The other infrastructure of
roads are all in place. It is a dream come true as far as a developer coming
in and redeveloping a brand new power plant at this time however we still
have to go through the stringent permitting and environmental issues of
which California is famous for. The project has met and in most cases
exceeded the minimum environmental regulations so there are no hurdles that
cannot be overcome and we have been very diligent in making sure that we
meet the environmental standards. Hurdles would be in drilling the wells,
and not every well is going to be successful so what you need to do is make
sure you use the existing technical data to the maximum extent so as to
mitigate the risk in drilling the wells. We have a huge amount of data from
the original wells that were drilled during that ten-year period I mentioned
earlier. We feel we have mostly eliminated the environmental permitting
variances; we have cut down on the risks from a technical perspective. Now
it is a matter of meeting the air quality emission standards of California
for building the power plant. Geothermal energy is a no-net polluter and
carbon dioxide emissions are hardly registered on the scale, there should be
no problems with building the power plant at our project site.
If you want to look at the remaining hurdle that would be the financing
hurdle and interestingly enough there has been a considerable change in
attitude on the part of the financial community over the past two years. Up
until about five years ago I could go into any financial institution in New
York, Toronto, London, and Zurich and talk about my geothermal projects and
they would look at me with a certain amount of pity because your fighting a
losing battle. While they were interested and maybe liked the story, they
were not ready to get involved in geothermal energy because they did not
understand it and because the technology in their opinion was unproven. As
it turns out there are over nine thousand megawatts of installed capacity
around the world in countries such as the United States, New Zealand,
Iceland, the Phillipines, so on and so forth. That message is now starting
to get across to the financial community, it is also being recognized that
geothermal energy is superior because of base load capabilities, its
reliability and sustainability. Over the past two years now instead of me
knocking on doors trying to raise capital the financiers are calling us now
to say are you interested in us putting money into your company and
financing your project. We are almost being swamped with offers now for
financing our geothermal projects which is a good thing.”
CEOCFO: Will you
please touch a bit on the expertise of your team?
Mr. MacLeod:
“Internally we have a board of directors that have extensive experience in
electricity generation ranging from Tom Drolet, who was the president of
Ontario Hydro International and built power plants around the world. Asgeir
Margeirsson, who was the
Deputy CEO and Director of
Production and Sales for Reykjavik Energy in Iceland. They
have been instrumental in building geothermal power plants throughout
Iceland and other parts of the world and he is currently the CEO of Geysir
Green Energy, which is a geothermal developer in Iceland once again
operating around the world, with expansive expertise in that regard. Domenic
Falcone is one of the founding fathers of geothermal development in
California in the late seventies and throughout the nineteen eighties. He
has been instrumental in working with me in developing the projects from
California, Canada, and looking elsewhere as well. My own background, which
is 25 years of resource administration, financing, and management in the
mining sector, oil and gas sector and since 2001 strictly in the geothermal
sector. Between those key members of our team, we have the ability to create
the policy for Western GeoPower to pursue geothermal energy in Canada, the
United States and we are looking in other parts of the world as well. In
addition to that, we have a very close relationship with GeothermEx, Inc. of
Richmond, California who is highly regarded around the world as one of the
foremost experts on geothermal resource evaluation and development for
almost eighty percent of the fields that are operating around the world. We
have a very close relationship with GeothermEx in that regard and it is
almost a seamless relationship because our technical team works very closely
with the technical teams at GeothermEx to ensure the veracity of the
technical data.”
CEOCFO: Why should
potential investors choose Western GeoPower?
Mr. MacLeod:
“Western GeoPower has been quietly building up the project in California
first of all as a 25 megawatt size project and over the past five months we
have extended the leasehold from six hundred acres to a thousand acres which
now enables us to increase the capacity up to 35 megawatts. That is one
reason why the project value in California has appreciated over the past few
months. Other factors to consider are the power prices in California has
increased approximately 13% over the past twelve months which makes our
project even more valuable than it was when we started the feasibility
report over a year and a half ago. We are looking at expanding within
California and other countries and we have been aggressive in identifying
projects in these various jurisdictions so that our shareholders will be
able to participate not just in one project in Canada and one in California
but numerous projects in various market segments in three or four areas
throughout the world. Thereby spreading the risk and looking at much greater
rewards as well. We feel that we are opening up a funnel for our
shareholders to participate in a very significant way in what we consider to
be an expansion of the geothermal power market by a factor of threefold over
the next fifteen or twenty years.”
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