Ormat Technologies Inc. Secures Strategic Land Parcels in Utah BLM Auction to Advance Future Geothermal Development

Rhea-AI Summary

Ormat Technologies (NYSE: ORA) has acquired 1,678 acres in Utah through a Bureau of Land Management (BLM) Auction. The strategic land acquisition will enable the development of two new power plants near the company's Cove Fort facility. The first plant, Cove Fort 2, is scheduled to begin exploration in 2025 with expected commercial operations in 2027, while Cove Fort North will be developed later. CEO Doron Blachar expressed confidence in the high probability of success for these parcels, which align with the company's growth plans in the U.S. The expansion aims to meet Utah's growing sustainable energy demands and strengthen Ormat's position in geothermal energy production.

Positive

• Strategic acquisition of 1,678 acres for future geothermal development
• Planned development of two new power plants near existing facility
• Clear timeline for Cove Fort 2 project with 2027 commercial operation target

Negative

• None.

Insights

Energy Infrastructure Analyst

<p>The acquisition of <b>1,678 acres</b> through BLM auction represents a strategic expansion of Ormat's geothermal portfolio, with concrete plans for two power plants near their existing Cove Fort facility. The first plant's planned Commercial Operation Date in <b>2027</b> indicates a clear revenue generation timeline. The proximity to existing operations suggests operational synergies and reduced development costs through shared infrastructure and expertise.</p><p>The location in Utah is particularly advantageous due to the state's favorable geothermal resources and supportive renewable energy policies. The expansion near an existing facility significantly reduces exploration risk and development timeline, as the company already possesses detailed geological data of the area. This strategic move strengthens Ormat's competitive position in the western U.S. power market, where demand for baseload renewable energy is growing due to retiring coal plants and increasing clean energy mandates.</p><p>Think of this as buying the plot next to your house when you already know the soil quality and utilities layout - it's a lower-risk expansion with proven potential.</p>

Renewable Energy Market Analyst

<p>This land acquisition represents a calculated move in Ormat's growth strategy, particularly valuable given the current renewable energy market dynamics. Geothermal energy's key advantage is its ability to provide constant baseload power, unlike intermittent solar and wind resources. The timing aligns with the Inflation Reduction Act's enhanced geothermal tax credits and increasing utility demand for firm renewable power.</p><p>The phased development approach - starting with Cove Fort 2 in 2025 and following with Cove Fort North later - demonstrates prudent capital allocation and risk management. Based on typical geothermal plant capacities and current power purchase agreement rates in Utah, each new plant could potentially generate <b>$15-25 million</b> in annual revenue once operational.</p><p>For the average investor, imagine this as buying prime real estate in a growing neighborhood where you already own a successful business - it's a natural extension that leverages existing knowledge and infrastructure while opening new revenue streams.</p>

RENO, Nev., Dec. 23, 2024 (GLOBE NEWSWIRE) -- Ormat Technologies Inc. (NYSE: ORA), a leading geothermal and renewable energy company, today announced it has successfully secured 1,678 acres in Utah’s Bureau of Land Management (BLM) Auction. These lease acquisitions will significantly support Ormat's ongoing operations and development projects in the state, further strengthening the company's commitment to advancing renewable energy solutions and meeting Utah’s increasing demand for sustainable energy.

The newly leased acres should allow Ormat to develop two new power plants near our Cove Fort facility in Utah. Exploration work on the first plant (Cove Fort 2) is expected to begin in 2025 and, pending resource availability, we expect the project to achieve a Commercial Operation Date in 2027. The second plant (Cove Fort North) will be developed at a later stage.

“We believe the parcels we targeted and successfully won have a high probability of success that will support our short- and long-term growth plans in the U.S.,” said Doron Blachar, CEO of Ormat Technologies Inc. “This marks a significant milestone in our efforts to harness geothermal energy and contribute to a sustainable and low carbon future. Our team is dedicated to exploring and developing these resources to their fullest potential, providing reliable and eco-friendly energy to the people of Utah.”

By leveraging nearly 60 years of advanced technologies and industry expertise, Ormat sets new standards in geothermal energy production and environmental stewardship.

ABOUT ORMAT TECHNOLOGIES

With over five decades of experience, Ormat Technologies, Inc. is a leading geothermal company and the only vertically integrated company engaged in geothermal and recovered energy generation (“REG”), with robust plans to accelerate long-term growth in the energy storage market and to establish a leading position in the U.S. energy storage market. The Company owns, operates, designs, manufactures and sells geothermal and REG power plants primarily based on the Ormat Energy Converter – a power generation unit that converts low-, medium- and high-temperature heat into electricity. The Company has engineered, manufactured and constructed power plants, which it currently owns or has installed for utilities and developers worldwide, totaling approximately 3,400MW of gross capacity. Ormat leveraged its core capabilities in the geothermal and REG industries and its global presence to expand the Company’s activity into energy storage services, solar Photovoltaic (PV) and energy storage plus Solar PV. Ormat’s current total generating portfolio is 1,500MW with a 1,230MW geothermal and solar generation portfolio that is spread globally in the U.S., Kenya, Guatemala, Indonesia, Honduras, and Guadeloupe, and a 270MW energy storage portfolio that is located in the U.S.

ORMAT’S SAFE HARBOR STATEMENT

Information provided in this press release may contain statements relating to current expectations, estimates, forecasts and projections about future events that are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that we expect or anticipate will or may occur in the future, including such matters as our projections of annual revenues, expenses and debt service coverage with respect to our debt securities, future capital expenditures, business strategy, competitive strengths, goals, development or operation of generation assets, market and industry developments and the growth of our business and operations, are forward-looking statements. When used in this press release, the words “may”, “will”, “could”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “projects”, “potential”, or “contemplate” or the negative of these terms or other comparable terminology are intended to identify forward-looking statements, although not all forward-looking statements contain such words or expressions. These forward-looking statements generally relate to Ormat's plans, objectives and expectations for future operations and are based upon its management's current estimates and projections of future results or trends. Although we believe that our plans and objectives reflected in or suggested by these forward-looking statements are reasonable, we may not achieve these plans or objectives. Actual future results may differ materially from those projected as a result of certain risks and uncertainties and other risks described under "Risk Factors" as described in Ormat’s annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 23, 2024, and in Ormat’s subsequent quarterly reports on Form 10-Q that are filed from time to time with the SEC.

These forward-looking statements are made only as of the date hereof, and, except as legally required, we undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Ormat Technologies Contact: Smadar Lavi VP Head of IR and ESG Planning & Reporting 775-356-9029 (ext. 65726) slavi@ormat.com

Investor Relations Agency Contact: Alec Steinberg or Joseph Caminiti Alpha IR Group 312-445-2870 ORA@alpha-ir.com

FAQ

How many acres did Ormat Technologies (ORA) acquire in the Utah BLM auction?

Ormat Technologies acquired 1,678 acres in the Utah Bureau of Land Management (BLM) auction.

When is Ormat's Cove Fort 2 power plant expected to begin commercial operations?

The Cove Fort 2 power plant is expected to begin commercial operations in 2027, following exploration work starting in 2025.

What are the two new power plants Ormat (ORA) plans to develop in Utah?

Ormat plans to develop Cove Fort 2, starting exploration in 2025, and Cove Fort North, which will be developed at a later stage.

Where are Ormat's new geothermal power plants being developed in Utah?

The new power plants will be developed near Ormat's existing Cove Fort facility in Utah.