Hungary PannErgy Reports Success at Second Production Well (Portfolio.hu)
Hungary’s geothermal energy company PannErgy has successfully drilled its second production well (MAL-PE-02) near Miskolc. The depth of the well is only 1,420 metres and it was reached with better-than-expected results in little over a month.
8,000 litres per minute water production with pressure of 2.8 bar and a temperature of 90 degree Celsius were shown by the two-week test.
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(Courtesy PannErgy )
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Hungary’s geothermal energy company PannErgy has successfully drilled its second production well (MAL-PE-02) near Miskolc. The depth of the well is only 1,420 metres and it was reached with better-than-expected results in little over a month.
8,000 litres per minute water production with pressure of 2.8 bar and a temperature of 90 degree Celsius were shown by the two-week test.
"This is the best production well in Hungary right now in terms of water yield without any additional engine help (compressor or pump)," commented József Miró, anlyst at Erste Bank in Budapest.
"This success is closing what may be the most important and riskiest stage of this development," said Balázs Bokorovics, Chairman of PannErgy’s Board of Directors.
The company is preparing to drill two additional drain wells alongside the existing one, while also building pipeline infrastructure, etc, the analyst ntoed.
Heating services are expected to start in Miskolc in the autumn, in line with the earlier plans.
"The findings show that the company will be able to sell up to 820,000-850,000 GJ heat per annum from the end of 2012. Calculating with a 40% discount on present more than HUF 5,000 GJ heat prices, the company will be able to produce EBITDA of some HUF 2bn per annum from 2013. Considering 5.6x EV/EBITDA13 (visible for utilities as a median on February 10 in our CEE weekly valuation monitor), the estimated fair value of the project is some HUF 410 per share. This value is just partially (some 50-75%) priced-in," Miró said.
"This success is closing what may be the most important and riskiest stage of this development," said Balázs Bokorovics, Chairman of PannErgy’s Board of Directors.
The company is preparing to drill two additional drain wells alongside the existing one, while also building pipeline infrastructure, etc, the analyst ntoed.
Heating services are expected to start in Miskolc in the autumn, in line with the earlier plans.
