Tata Power to acquire stake in Australian geothermal firm

New Delhi, Sep 4: India's largest integrated power company, Tata Power Co, will acquire 29.4 million ordinary shares representing 11.4 percent equity in Geodynamics Ltd, an Australian geothermal energy company, it said Thursday.

In a regulatory statement, Tata Power said it would pick up the stake either on its own, or through one or more of its subsidiaries in India and abroad.

Tata Power will buy the shares at AUSD 1.5, entailing a total investment of AUSD 44.1 million or about Rs.165 crore (about Rs.37.5 million)

"The strategic partnership with Geodynamics will strengthen our renewable energy portfolio and help us enter the market in Australia," said Tata Power managing director Prasad Menon.

Geothermal energy is the natural heat found within the earth where temperature increases with depth, typically rising from 10 degree celsius to 50 degree celsius per kilometre. This heat is extracted from granites located at depths of over 4,000 metres by circulating water through them in an engineered artificial reservoir.

The heated water returns to the surface under pressure and is converted into electricity with the help of heat exchanger and a conventional geothermal power plant.