Fervo Shares at $8.99 Amid Claims About Geothermal Project Performance
Key Facts
Fervo Energy shares closed at $8.99 on October 29, according to EL7 data, weeks after a report published by Morpheus Research on October 6 raised questions about the performance of the company’s projects. A Hagens Berman statement attributed to the report the conclusion that Fervo had not disclosed material problems, including thermal degradation, water loss and equipment damage linked to seismic activity. These are allegations made in the report, not established findings. Fervo told Heatmap it was reviewing the claims and described them as selective framing of early experimental data to support a predetermined conclusion. It added that its disclosures to investors and regulators are the appropriate record for assessing project performance.
According to Heatmap’s coverage, the Morpheus report drew on Fervo disclosures and additional data the company provided to Nevada regulators, as well as interviews with an unspecified number of unnamed former employees. The claims concerned operational risks in geothermal projects, including thermal degradation, water loss and equipment problems linked to seismicity. But experts interviewed by Heatmap did not agree that Project Red data established Morpheus’s interpretation of thermal degradation. The coverage also said the company affirmed the validity of an alternative explanation for the temporary decline in heat. That places the dispute within a disagreement over how to interpret project data, alongside differences over what the company’s disclosures show.
On water, Fervo said it measured 90% retention in a three-well test at Cape Station, while continuing to model 99% retention for the full design. By contrast, Heatmap reported that Project Red lost water at a steady monthly rate of 20% to 30% throughout its operating period. Fervo had disclosed this and attributed the loss to the experimental two-well design. These figures compare the Cape Station test and its target design with the Project Red trial, though the projects differ in conditions and design. On this point, the report and the company rely on different readings and operating metrics.
As for the stock, FRVO closed at $14.33 on October 6, about 46% below its May initial public offering price of $27, according to a statement published on October 13. The October 29 close of $8.99 is a later price, and comparing the two figures does not represent a move between consecutive trading sessions. Fervo disclosed in August that it might curtail or temporarily halt production during 2027 because of expected conditions involving its electricity transmission partners. The company said those conditions could reduce its output for a period, linking project risks to the ability to transmit electricity to buyers. The disclosures did not say that a transmission outage had already occurred.
By contrast, Fervo announced that the first GeoBlock unit at Cape Station achieved net output of 33 megawatts, meeting the expected production threshold under its power purchase agreement. The company said the unit declared commercial operations on September 30, one day ahead of its contractual deadline, and began generating revenue under the agreement. Phase one comprises about 100 megawatts across three units, while construction is underway on an additional 400-megawatt second phase targeted to begin operating in 2028. In September, Fervo announced a 396-megawatt power purchase agreement with Google for the Cape Station project, which is expected to enter service in 2028. It also gave the buyer an option to increase purchases by about 600 megawatts, bringing the potential total to nearly one gigawatt by June 2030.
Second-quarter financial results show the scale of spending tied to expansion: Fervo posted an operating loss of $28.7 million and a net loss of $55.9 million. Capital expenditures were $226.5 million, compared with $108 million in the same quarter of 2025. The company raised its long-term development target to 1.1 gigawatts by 2030, an increase of 100 megawatts from its previous target. As construction and operations continue, Fervo said the two remaining GeoBlock units in phase one are expected to reach contractual operations by January 1, 2027. The company is expected to report its third-quarter financial and operating results before the market opens on November 9, 2026, and hold an investor call the same day at 10 a.m. Eastern time.