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Ram Power posts increased losses as it invests to expand

Ram Power is investing in its geothermal properties like the Geysers site in California

Ram Power has posted increased losses as it continues to invest to expand its geothermal development activities.

The company based in Reno, Nevada made a $6.45 million net loss during the three months up to the end of June 2010, compared to $4.94 million the same period in 2009.

Revenue was down at the $1.08 million level compared to $1.69 million in the second quarter of 2009.

However, the company currently preparing to snap up its rival Sierra Geothermal Power (see this BrighterEnergy.org story) in a $28 million deal said it invested $51.6 million in its geothermal properties during the quarter.

This included $23 million spent on the Phase I and II expansions at its San Jacinto site in Nicaragua, along with $20 million to acquire land rights at the Geysers, California (see this BrighterEnergy.org story).

Some $6.5 million was also spent on its Orita project in California’s Imperial Valley, where drilling began in April.

As of June 30, 2010, Ram Power had cash and short-term investments worth $91.5 million and a long-term debt of $45.6 million.

Expansion

Hezy Ram, CEO of Ram Power, said his company was continuing with its plan to become “one of the world’s preeminent geothermal power companies”.

He explained: “We are in the final stages of the negotiation process for the Phase II expansion’s financing, which is expected to close in the third quarter. Drilling activity commenced at the Orita project in parallel to negotiations with EPC contractors.

“We recently purchased the land rights associated with our Geysers project in Northern California which will allow for flexibility and autonomy in the development of this project, which is a continuation of our commitment to developing our pipeline of projects to their full potential. As well, the Company announced the pending acquisition of Sierra Geothermal Power Corp,” added Mr Ram.

Ram Power’s revenue for the first half of 2010 was $2.06 million, down from $3.04 million in the first half of 2009. Losses for the first half were $10.49 million compared to $6.29 million in the equivalent period in 2009.