Tom Konrad CFA
My entire portfolio of Geothermal companies received DOE cost-sharing grants Friday. Here’s a quick run-down:
- Nevada Geothermal (NGLPF.PK, NGP.V) received $1.7M for its Crump Geyser project, and $1.6M for its Black Warrior project. NGP also celebrated completion of its Blue Mountain Faulkner 1 plant the same day.
- US Geothermal (HTM) received $3.77M for it San Emidio project.
- Sierra Geothermal (SRAGF.PK, SRA.V) received $10M for exploration at its Alum and Silver Peak projects.
- Ormat (ORA) received two grants, and is likely to benefit from other grants since geothermal exploration companies such as US Geothermal contract with them for many services.
- Up to $61.9M was awarded to ground source heat pump demonstrations, which will help my two Geothermal Heat Pump stocks, Waterfurnace Renewable Energy (WFFIF.PK) and LSB Industries (LXU).
Market Reaction
While the geothermal exploration companies (NGP, HTM, and SRA) were all up today, Ormat and the geothermal heat pump stocks were down (ORA -1.23%, WFI.TO -1.12%, and LXU -2.67%, on a day the S&P 500 fell 2.81%) Ormat was probably down in sympathy with the market because it is much larger than the other companies listed, and these grants won’t make that much difference to its bottom line. Waterfurnace and LSU may have gotten less market benefit since the grants were not directly to them, and money for geothermal heat pumps was already expected to be part of these grants.
Practically the only (nearly) pure-play geothermal company that didn’t get something was Raser Technologies (RZ), which I told readers I sold in September when the DOE announced they were no longer under consideration. I sold Raser at $1.78, taking a small (11%) loss. It closed Friday at $1.18. I’m glad I got out when I did, although readers of the article who sold on my recommendation will have done better than I. Raser bumped around in the $1.80-85 range for a couple weeks after I published my article, and even hit $2 briefly.
DISCLOSURE: LONG NGPLF, HTM, SRA.V, ORA, WFFIF, LXU.
DISCLAIMER: The information and trades provided here and in the comments are for informational purposes only and are not a solicitation to buy or sell any of these securities. Investing involves substantial risk and you should evaluate your own risk levels before you make any investment. Past results are not an indication of future performance. Please take the time to read the full disclaimer here.
