Geothermal Development in the Assal Area, Djibouti

Abstract

Reykjavik Energy Invest (REI) along with investors intends to build a 50 MWe geothermal power plant with the possibility of an expansion of up 150 MWe in the Assal geothermal area in Djibouti. REI has the exclusive license from the Government of the Republic of Djibouti for geothermal utilization of the Assal area. REI and the Djibouti authorities have also signed head of terms project and power purchase agreements. A pre-feasibility study of the field was completed for REI in January 2008. The study included a surface exploration, cross-correlated with older drilling results and field data. A new conceptual model based on the interpretation of the data has been constructed and sites for exploration wells decided. The pre-feasibility study also includes an environmental management plan for the drilling of the exploration wells. Currently the project is in the feasibility phase which includes building of access roads and drill pads, installing a seawater supply system to provide drilling fluid, and the drilling of three deep deviated geothermal exploration wells. The preparation work will take place in the summer 2009 and the drilling of the exploration wells will start in late 2009. Once the power potential of the site has been assessed REI will start making preparation for the construction of the plant. It includes the conceptual design of the power plant, analyzing cooling possibilities for the operation, and the drilling of production wells to secure the designed capacity of the plant. While preparing for the construction REI will finalize the PA and PPA with the Djibouti Government, secure funding for the next phase, and complete an environmental impact assessment. The construction cost estimate for the 50 MWe geothermal plant is US$ 170 million and the construction of the plant should be completed in 2013/2014.