Fervo Logs 1,054 MW Under Binding Contracts After GeoBlock 1 Begins Commercial Operations

Key Facts

Fervo Energy said GeoBlock 1 at its Cape Station project began commercial operations on September 30, ahead of its contractual deadline, with capacity of 33 MW. The company said the unit is operating in line with its expectations for production and power delivered under the power purchase agreement. The announcement came with third-quarter results, which CEO and co-founder Tim Latimer described as the quarter in which Cape Station reached first power and contractual commercial operations. The start of operations marks the project's transition from construction and testing to delivering electricity under its agreement. The company's shares closed at $9.03 on November 6, following mixed moves during the previous week's sessions.

Latimer said the Google agreement opens a path to expanding the partnership to nearly a gigawatt. The agreement covers 396 MW over 15 years and eight GeoBlock units under a grid-connected contract with binding purchase terms. Fervo expects to begin supplying power from these units in mid-2028, with full capacity targeted by the end of that year. The agreement therefore does not represent electricity revenue that has already begun; deliveries under it are still targeted for about two years after GeoBlock 1's commercial operations announcement. The agreement links the company's expansion to a major power buyer, while meeting subsequent delivery and operating dates remains a key project milestone.

Following the Google agreement, Fervo said binding power purchase agreements cover 1,054 MW and represent about $11.9 billion in contracted revenue. At the end of the second quarter, the company had reported 658 MW and about $7.2 billion in contracted revenue. The change shows an expansion in capacity tied to power purchase agreements during the third quarter, alongside the signing of the Google agreement. The company stressed that the $11.9 billion figure represents approximate contracted revenue, not revenue realized in the quarter. The agreements provide visibility into future revenue tied to power delivery, while converting it into actual revenue depends on the units entering service and delivering electricity under the agreements.

On its results, Fervo reported net income of $11.7 million in the third quarter, but recorded a net loss attributable to common shareholders of $20.8 million, or $0.07 per share. The company said net income included nonrecurring items and gains from interest income, placing the two figures in different accounting contexts. The company ended the quarter on September 30 with unrestricted cash of $1.9 billion, compared with current and long-term debt of $301.6 million. The figures show substantial cash resources alongside a loss attributable to common shareholders as the company continues to develop the project units. In its outlook, it said fourth-quarter revenue would be in line with its previous expectations and that it would be the first full quarter to include revenue from Cape Station.

Fervo had described the first phase of Cape Station in an August update as a project with capacity of about 100 MW, divided among three GeoBlock units with capacity of 33 MW each. At the time, the company expected GeoBlock 1 to begin generating test power during the fourth quarter, with full production targeted by the end of 2026. It then announced in September that the unit had begun commercial operations ahead of its contractual deadline. GeoBlock 1 is part of the first-phase plan, which includes all three units, making completion of the other two important to finishing this phase. The Google agreement, meanwhile, covers eight units and targets the start of their first power in 2028.

Fervo said GeoBlock 2 entered early operations and began delivering test power to the grid, while GeoBlock 3 was in cold commissioning. The company expects both units to begin commercial operations by January 1, 2027, completing the first phase of Cape Station. It also left its previous 2027 revenue outlook unchanged, according to the results statement. On November 6, Investing.com reported that Needham initiated coverage of Fervo shares with a "Buy" rating and a $17 price target, citing the company's position in next-generation geothermal power contracts. The report quoted Needham as saying drilling time had fallen from 70 days to 21 days across the company's successive designs.