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JOGMEC to Provide a Guaranty of Liabilities Concerning a Project for Geothermal Power Generation in Hachimantai City, Iwate Prefecture

The Japan Oil, Gas and Metals National Corporation (hereinafter referred to as “JOGMEC”), an organization under the jurisdiction of the Ministry of Economy, Trade and Industry (METI), decided to provide a guaranty of liabilities concerning a project for geothermal power generation that Iwate Geothermal Power Co., Ltd. has been operating in the Matsuo Hachimantai area, Hachimantai City, Iwate Prefecture.

1. Outline of JOGMEC’s program for providing a guaranty of liabilities

JOGMEC has been conducting a program for providing a guaranty of liabilities for businesses developing geothermal resources. Under the program, when such businesses intend to raise funds from private financial institutions to fulfil the loan needed for the construction of a geothermal power plant, JOGMEC will provide these private financial institutions with a guaranty of liabilities for these businesses of up to 80% of the total loan amount.

This measure aims to facilitate lending of funds by private financial institutions to businesses developing geothermal resources through a system in which JOGMEC assesses the potential risk of such geothermal resource development projects which private financial institutes are not able to assess for themselves, thereby achieving further introduction of geothermal power generation.

2. Outline of the project

Iwate Geothermal Power Co., Ltd. has been operating the project for geothermal resource development in Hachimantai City, Iwate Prefecture, funded by FY2012 to FY2014 JOGMEC subsidies for geothermal resource quantitative surveys and by FY2015 and FY2016 JOGMEC investment in geothermal resource research. As part of the project, the company has decided to construct a new, 7,000 kW-level power output single-flash geothermal power plant as a goal. In addition, the project will become the first case in which one company receives every available support measure: subsidies, funding and a guaranty of liabilities.

The company will obtain a portion (6.653 billion yen) of the total funds for the plant construction from Mizuho Bank, Ltd., Tohoku Bank Ltd. and Bank of Iwate, Ltd. as long-term loans payable, and therefore, JOGMEC will provide a guaranty of liabilities with each of these financial institutions for an equivalent of 80% of the loans payable.

For details of the project, see the Appendix.

Appendix

Release date

February 27, 2017

Division in Charge

Fuel Policy Planning Office, Policy Planning Division, Natural Resources and Fuel Department, Agency for Natural Resources and Energy

Related website

Ministry of Economy, Trade and Industry1-3-1 Kasumigaseki, Chiyoda-ku, Tokyo 100-8901, Japan Tel: +81-(0)3-3501-1511
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