By MYLA IGLESIAS

Energy secretary Angelo Reyes yesterday said that the government hopes to outpace soon the Americans in producing steam energy after awarding three contracts to develop fields that can churn out as much as 1,000 MW of power.

The Philippines has 1900MW installed geothermal capacity while the US has more than 2000MW capacity.

The three contracts were given to Guidance Management Corp., (GMC), Biliran Geothermal Inc., and Basic Energy Corp.

The sites offered were Amacan in Compostela Valley for GMC, Biliran for BGI, and Mabini, Batangas for Basic.

Joaquin C. Rodriquez chairman of Guidance Management Corp. (GMC), a group of American, Australian, Spanish and Filipino investors said " we are 70 MW below the US capacity, we , 'the three horsemen' that would bring the Philippines to the top in the world production of geothermal power will be very proud to do that."

GMC will initially spend $8 million to conduct geological surveys before drilling exploratory wells at the Amacan geothermal prospect in Compostela Valley province in the southern Mindanao.

"We will spend roughly around $300 million to develop the initial 40 MW capacity of the area, but we're hoping that it could be more than 40 MW and may reach 700MW," Rodriguez said.

The Energy department has awarded GMC a 50-year contract to explore geothermal projects in an area totalling nearly 47,500 hectares in Compostela Valley.

It takes $2 million to put up 1 megawatt plant, double the average 10 years ago.

By this rule investors will need $240 million to generate 120MW of electricity.

DOE has awarded Biliran province with 20 to 40 MW target capacity to Biliran Geothermal Incorporated ("BGI").

It is a joint venture company formed between Filtech Energy Drilling Corp. ("FEDCO") and Envent Holding Philippines, Inc. ("Envent") which will invest $15 million.

Basic has the smallest exploratory expense of $3 million to develop the Mabini site.

The Philippines, the world's second-largest producer of geothermal energy after the United States, has 22 active volcanoes and sits on the seismically active Ring of Fire.

The country has an installed geothermal capacity of slightly more than 1,900 MW, but the government estimates the Philippines has untapped geothermal resource of at least 2,600 MW.

The Philippines wants to raise its geothermal capacity to 3,131 MW by 2013.

Geothermal power currently accounts for around 18 percent of the energy needs in the Philippines.

Reyes said studies from the US National Renewable Energy Laboratory have shown the Philippines' geothermal resources has a capacity to generate 200,000 MW of power.

GMC also operates two coal mining projects in the central province of Negros, holds a geothermal service contract in the northern Kalinga province, and a $150 million biofuels project.

A third company, Biliran Geothermal Inc, has plans to spend $15 million to develop a geothermal project covering 22,394 hectares in the central Visayas region. The area is estimated to have at least 100 MW of geothermal energy.

Growing concern about greenhouse gas emissions released by conventional power plants, high oil prices and growing power demand have fuelled the popularity of geothermal power. - with reports from Reuters