Naknek Electric Association is hopeful a workover of its troubled geothermal well “can be completed in March or earlier,” say papers filed in U.S. Bankruptcy Court in Anchorage.
The small electric power cooperative in Southwest Alaska was forced to file for Chapter 11 protection from creditors in September due to cost overruns and other issues with its geothermal drilling project.
The co-op has received a bankruptcy judge’s permission to pursue a $1.5 million loan to finish work on the 10,433-foot well, specifically to lift water, cuttings and drilling mud so the well’s temperature and flow can be tested.
The loan would come from the National Rural Utilities Cooperative Finance Corp., a private, nonprofit lender based in Herndon, Va.
Goal geothermal power plantUltimately, NEA wants to drill several wells and install a geothermal power plant to produce electricity for villages in the region. The goal is to reduce the co-op’s reliance on expensive diesel fuel to run generators.
The co-op serves the villages of King Salmon, Naknek and South Naknek, including some of Bristol Bay’s big salmon processing plants.
The G-1 well site is northeast of King Salmon.
NEA began looking at geothermal several years ago, as the boundary of the volcanic Katmai National Park and Preserve is just a few miles from the co-op’s electric lines.