An unauthorized collection of the records of Alternate Energy Holdings, inc., its principals and subsidiaries, and their antics, trials, and tribulations

Former AEHI CEO Don Gillispie

Former AEHI CEO Don Gillispie
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Thursday, October 21, 2010

Did "Discovery of a Geological Fault" Stop the Project?

From October 5th's "Warning about Negative AEHI News", in which the CEO Don Gillispie claims,  "AEHI has been honest and above board in all its activities related to stock or financial dealings, which are regularly published as mandated by law because AEHI is a publicly-traded company."

Taking their claim of having been "honest and above board", let us examine AEHI's statement made on the AEHI blog on November 23, 2009:

"AEHI considered building a plant in Owyhee County in 2007 and early 2008, until discovery of a geological fault stopped the project." (emphasis added)

Here is what CEO Don Gillispie stated in his deposition duces tecum for his still pending lawsuit in March of 2009: ("Q" is the attorney asking Don the questions)
Don: "I had signed an agreement with a company called UniStar to come out and do a more detailed look of the property.  They did a study.  I signed a contract in July of '07.  They did a study, and gave me a report in September, that picked a different site than the one I thought was suitable on that property.  And said, this is the best place for the site"
Q.  The best place to put the site on the Hilliard property? (ed. note- the "Hilliard property" is the Owyhee County site referred to in AEHI's press releases)
Don: "Right."
A couple of lines later:
Q. And you got the report from UniStar in September?
Don "Yes."
Q.  And as a result of that report, did you determine that the Hilliard property would not be suitable for-
Don: "No, that report actually told me the oppositeIt told me the property was suitable, and that there was a better location than the one I had in mind on the property."
A few more lines later:
Q.  And why did you decide not to close on that property?
Don"Well, there were two things going on.  First of all, we had not received funding, because we lost our silent partner there, Pacific Gas and Electric...."
Q.  ...You decided not to close on the Hilliard property, because you lost your funding from Pacific Gas and Electric?
Q.  You said there two things going on.  What was the other thing going on?
Don:  "The other thing going on was that Hilliard would not- he had been extending the contract, whenever it came up, like a six-month contract.  And in early '08, he didn't extend it."

View images of the deposition transcript from the actual court file here and here.

To recap:  AEHI CEO Don Gillispie, under oath in a deposition in March of 2009, stated that AEHI did not close on the property because "...we had not received funding..." and that the property owner did not extend the closing date for the contract.  Then, in November 2009, AEHI stated that the Owyhee project stopped because of the "discovery of a geological fault."  Which is it, Don?
Do these contradictory statements meet AEHI's claim of being "...honest and above board..."?

UPDATEThird Story Spin Version Found here (Right from the AEHI website) (!)
April 4,2008
"Preliminary geologic studies a year ago found old underground faults at the Owyhee site but they were not serious enough to stall the project. However, they are adding significantly to analytical and construction expense. This fact, coupled with the high land costs, makes the Owyhee site less attractive."  (emphasis added)
Note how this self-serving company release, on its own website no less, makes no mention whatsoever of the loss of the silent partner and Hilliard's refusal to grant yet another closing date extension as reasons for the move.
Which story is it, Don? 
Do these contradictory statements meet AEHI's claim of being "...honest and above board..."?
Don Gillispie's own presentation, September 10, 2007, on slide #9:
  "-4000 acre designated site with seismic stability near CJ Strike Reservoir" (emphasis added)  
UPDATE #3!!!- thanks to Melissa Davis at Streetsweeper
From an April, 2008 Mountain Home News Article, dripping with gullibility, adoration, and credulity:
"The move was made for a number of reasons, including the discovery of a fault line on the Bruneau property as part of the company's evaluation of the site. The area is known to have a number of fault lines, but most are over 500,000 years old, CEO Don Gillespie of AEHI said. The fault line they discovered "is a little younger than that, although not much, but we thought it would be a big hurdle," and would drive up the analytical costs for future filings before the Nuclear Regulatory Commission."

Later in the article, when referring to the new (now old) Elmore County site he somehow knows,  "There are no fault lines on this side of the river," (as quoted in the article)
However, one of the excuses used for not siting the plant in Elmore County's heavy industrial zone is (from the AEHI Blog):
"The Simco Road location has geologic issues that could make qualification expensive, if it is possible at all, on account of strict NRC requirements regarding geologic stability."
Which Story is it, Don?

Let us further examine the claim of "discovery of a geological fault":

If you were an Idaho 9th grade Earth Science student and wanted to discover geological faults in Idaho, you might consult this 2003 map.  If you were a Rimrock, Idaho, 9th grade Earth Science student and wanted to discover geological faults in the Bruneau area, you might consult this 1998 map.

But if you were the CEO of a corporation proposing to pay millions of dollars in 2007 for a piece of property on which to build a nuclear power plant, you would first consult those maps, prepared in 2003 and 1998, to see if the property had any geological faults.  Then, being a CEO with 45 years of experience in the nuclear industry, you would automatically consult the NRC site selection criteria to see if those faults would disqualify the site for which you were about to pay millions of investor's dollars, wouldn't you?  And, if you had somehow not done that rudimentary homework and accidentally committed to purchasing a site ridden with hidden geological faults, wouldn't you remember precisely what those geological issues were so you wouldn't make that mistake a second time?  Take a look at that first map again and you will notice that the new proposed Payette County site is about 20 miles from a "young" (activity in the last 10,000 years) fault with greater than 700 feet of escarpment relief, whereas the Bruneau site was about 90 miles from this same fault. In other words, Don moved his proposed operation 70 miles closer to a more recently active and more severe fault than any of those near the original Bruneau site.

But that whole discussion hinges on the assumption that all faults are automatically bad and cause for rejection of a potential site.  This more specific set of geologic and seismic criteria casts doubt on that assumption, and seems to indicate a 200-mile radius for fault identification.  Which then begs the question- what good is moving 70 miles going to do, geologically speaking?

Don himself sums this madness up nicely in his email response to a question about the "geological issues":

------Original Message------
To: Don Gillispie
Subject: Geologic issues
You stated that there were geologic issues at the site. Could you specify what those geologic issues are?
From: Don Gillispie
Subject Re: Geologic issues
>>Not a geologist. Sliding plates and soil composition. Moot.

Not a geologist.

Here's some local help for our geologically challenged CEO:
A geology research center at Boise State.
Or, he could take an introductory geology night class at BSU.
Wait- doesn't he already have an electrical engineering degree from Clemson?

1 comment:

  1. I have been trying to get people to look at the fault zones for the past year. I talked to someone doing the site evaluation for Warren Buffet's company and they stated that this area is to unstable to build a nuclear power plant. From Cambridge through New Plymouth is is unstable and that is the real reason Buffet pulled out.