Claims have been made that some geothermal plants cause seismic activity and related property damage which may result in claims or litigation that could be costly and distract management from operations and negatively impact our financial condition.
There are approximately two-dozen geothermal plants operating within a fifty-square-mile region in the area of Anderson Springs, in Northern California, and there is general agreement that the operation of these plants causes a generally low level of seismic activity. Some residents in the Anderson Springs area have asserted property damage claims against those plant operators. There are significant issues whether the plant operators are liable, and to date no court has found in favor of such claimants. While we do not believe the area of the Raft River and Neal Hot Springs projects or our intended operation of a power plant will present the same geological or seismic risks, there can be no assurance that we would not be subject to similar claims and litigation. Any claims or litigation could be costly and time consuming to defend and distract management from operations which may adversely impact our operations and financial condition.