The company's ultimate goal is to develop a commercial power station, in conjunction with suitable partners, to generate base-load electricity into the national grid, and to supply much of the electricity needs of remote operations such as the giant Olympic Dam copper-uranium-gold mine.

To achieve its aim, Petratherm is already acquiring exploration acreage in South Australia containing some of the hottest near-surface granites in the world - and plans drilling as early as November.

A key plank in Petratherm's strategy is the use of exploration methodology assisted through research with the University of Adelaide’s commercial development arm, taking current hot rock technology a step forward.

This new development allows economic HR deposits to be identified close to surface (within 3.5 kilometre depth) without the need for very deep, expensive drilling, and allows targets closer to commercial markets to be explored.

"The requirement in Australia for power from renewable energy sources will only increase as demonstrated by the Government’s Mandatory Renewable Energy Targets and their Renewable Energy Certificates scheme," said Petratherm's chairman, Derek Carter.

"HR is one of the few renewable energy sources able to provide much needed base-load power without major environmental impact and Petratherm is seeking to exploit this opportunity through developing HR energy at shallower depth and lower cost," Carter said.

Along with its $6 million Initial Public Offer (IPO) the company has applied for a $4 million Commonwealth R&D Start Grant to supplement the IPO funds and to assist with development of exploration and production methods.

Under the IPO however, Petratherm is offering up to 30 million ordinary shares at $0.20 cents per share to raise up to $6 million. Key Petratherm shareholders at listing will include the ASX-listed Minotaur Resources Ltd (33%), whose shareholders will be entitled to a priority allocation of up to 10 million of the Petratherm shares.

"Petratherm's modelling suggests that a block of granite one kilometre thick over a 25 square kilometre area, and having an initial temperature of 270°C, can support the generation of 1,000 megawatts of emission-free electricity over a 25-year period,” said Carter.

Petratherm's three projects - at Ferguson Hill north of Olympic Dam, Callabonna and Paralana near Mount Painter - cover 1,500 square kilometres and lie within a geothermal energy province known as the South Australian Heat Flow Anomaly.

The tenements are thought to contain hot rocks at depths of between three and 3.5 kilometres, significantly shallower than historic geothermal wells where drilling, development and production costs rise dramatically beyond 3.5 kilometre depth.

The Callabonna and Paralana targets are also within 170 kilometres of South Australia's main electricity grid at Leigh Creek, while Ferguson Hill lies only 70 kilometres from Olympic Dam.