Hunter Valley exploration licences

Geodynamics holds a 100% interest in two exploration licences in the Hunter Valley, NSW as shown in the figure below. These licences were renewed in February 2008 for a period of 3 years. The company has an agreed work program with the NSW Department of Primary Industries involving the drilling of an intermediate depth well (2 km) and subsequent planning of a deep well within the 3 year renewal timeframe.

During the year the Company was successfully awarded $10 million in funding assistance under the NSW Renewable Energy Fund program to develop a small geothermal power generation plant. In addition to the NSW government funding the Company has also applied for funding assistance under round 2 of the federal government’s Geothermal Drilling Program to assist with the drilling of the first deep wells to prove proof of concept in the Hunter Valley.

The Company has successfully completed a Review of Environmental Factors and is currently in the process of negotiating the appropriate access and regulatory approvals to commence the drilling of an intermediate depth well to 2 km (into the basalt, below the coal measures) to firm up temperature estimates in the granite basement.

Queensland geothermal exploration permits

The company has negotiated and finalised terms with the Queensland Department of Mines and Energy, but is still awaiting formal grant of the geothermal exploration permits (GEPs) which is expected shortly.

When the GEPs are finally issued the Company expects to commence a program of surface analysis and then shallow heat flow drilling. The Company also expects to receive a $150,000 Smart Mining Collaborative Drilling grant from the Queensland government to assist in the shallow drilling.

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