* Sees additional costs of $15-$20 mln for the project
* Target dates for Phase I, II expansion extended
* Co says it has signed a new contractor for the project
* Shares touch nearly 21-month low (Adds company comments, details, share movement)
By Bhaswati Mukhopadhyay
BANGALORE, Feb 7 (Reuters) - Canada’s Ram Power Corp RPG.TO said its San Jacinto-Tizate project in Nicaragua encountered construction delays, and was also facing higher material and labor costs, sending shares of the company down to a nearly 21-month low.
The project has about $15-$20 million of additional construction costs, the renewable energy company said in a statement.
Steven Scott, director of investor relations, said the company is moving to a new contractor as labour and procurement issues had delayed the project.
“We just have not had the luck that we thought we would have with our current contractor,” Scott told Reuters.
The company named TIC International as the new contractor.
Ram Power expects to contribute $10-$15 million of additional equity to the project to cover the cost overrun.
“We thought we are going to have revenues coming in the project in April, now it looks like it is going to be closer to July, August,” Scott said.
The San Jacinto-Tizate project is located in northwest Nicaragua and the area has been known for its natural fumaroles and geothermal resources.
The first phase of expansion, which was scheduled to be completed in 18 months with a target commission date of April, is now expected to be completed in 21 months with a target commission date of July.
Under the revised Phase II exploration drilling program, the company is expected to incur about $27 million in additional drilling expenses.
Expansion for the second phase has also been pushed back to March 2012 from December 2011 due to construction delays.
Ram Power, which has interests in geothermal projects in California, Nevada and Canada, is raising the production capacity of the facility to 72 MW from 10 MW .
Ram Power shares, which have lost 14 percent of their value in the last six months, were down 19 Canadian cents at C$1.74 on Monday morning on the Toronto Stock Exchange. They had touched a low of C$1.73 earlier. (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Anne Pallivathuckal, Sriraj Kalluvila)