The first phase of what could eventually be a full 90 MW of geothermal power production is now underway in Idaho.

The first phase of what could eventually be a
full 90 MW of geothermal power production is now underway in Idaho. The project
developer, US Geothermal, secured a partnership for initial construction
of the first 10 MW which could be generating power by 2006.

US Geothermal secured an agreement with Lockwood Greene
E&C, a subsidiary of CH2M Hill, a global engineering, construction, technology
and operations firm, to provide project construction management services for
the phase one construction of a 10 MW geothermal power project at Raft River

‘We have now assembled the right team to construct and start up a geothermal
power plant at Raft River and meet our on-line electricity generation date,’
said Daniel Kunz, the company’s President and CEO.

US Geothermal owns 660 acres and further holds the geothermal rights to
approximately 3,500 acres of private lands, which comprise the 6.5 square
mile Raft River project development in Southeastern Idaho, a geothermal
reservoir that was the site of a former US Department of Energy geothermal
research facility

The Company possesses three Power Purchase Agreements with the Idaho Power
Company for the production of 30 MW of electricity at Raft River. Construction
of the Phase One power plant is planned in 2005 and power production is
planned for 2006.

Lockwood will provide project construction management services, direct
construction work, and will assist US Geothermal in the selection of the
power plant technology; a choice between conventional organic rankine cycle
and ammonia absorption cycle technology.

In addition, US Geothermal can request that Lockwood convert their services
from a fee based construction management arrangement to a fixed price, turnkey
engineering, procurement, and construction contract.

On the basis of a report prepared by the company’s independent consultant,
GeothermEx of Richmond California, the US Geothermal believes that Raft
River’s energy reservoir is scalable to
produce an estimated 90 MW of power from 6.5 square miles of lands owned
or leased by them.

‘Adjacent to the existing electrical transmission grid and surrounded by
modern infrastructure, Raft River is ideally located to make an important
contribution to the power needs of the rapidly growing Pacific Northwest
for decades to come,’ said US Geothermal in a statement.

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