Contact Energy announced on Tuesday that it has purchased 100 per cent of the shares in Western Energy Services, a specialist geothermal well service company based in Taupō.
The announcement comes hot on the heels of the sod turning at Contact’s new $580 million Tauhara Power Station on March 31, with the transaction completing on the same day.
The geothermal power station, just outside Taupō, will be the country’s largest post Covid-19 investment, and was hailed by Prime Minister Jacinda Ardern at the official start of construction as a huge step towards a 100 per cent renewable energy New Zealand.
Contact chief executive officer Mike Fuge called the purchase of Western Energy a “strategic fit with our ambition to lead New Zealand’s decarbonisation” saying that it complemented the company’s investment in renewable generation at Tauhara.
In a release on the union, Contact said the two companies had worked closely together for over five years and jointly developed innovative technology that had materially lowered the cost of Contact’s geothermal operations.
Mike Dunstall, general manager geothermal resources and development at Contact, said Western Energy’s 30 staff had extensive expertise in well services.
“Combined with our 60 years of geothermal field and plant experience and a geothermal development pipeline, we see this partnership delivering our renewable geothermal energy at even lower cost.”
Western Energy would continue to be run as a separate company with its own management team and governance structures, said the release.
Its general manager Karl Spinks said Contact’s influence would propel the company forward, and it expected to expand its range of services to geothermal customers.
The Tauhara geothermal station, expected to be completed in mid 2023, will provide power for 175,000 homes and result in an estimated 450 tonne per annum carbon reduction.
The acquisition of Western Energy had been funded from existing credit facilities, said Contact. The transaction price was being kept confidential.
Credit: Stuff.co.nz
