Hot rocks pioneers keep the faith

DRAWN-out drilling problems at Geodynamics’ Habanero ‘hot rocks’ project have not dampened the enthusiasm of geothermal explorers, who say they remain confident that subterranean heat exchange reservoirs can deliver enormous quantities of energy with negligible carbon emissions.
Hot rocks pioneers keep the faith
Hot rocks pioneers keep the faith
Hot rocks pioneers keep the faith
Hot rocks pioneers keep the faith
Hot rocks pioneers keep the faith

Geothermal power is nothing new. Tapping into hot springs, hot aquifers and volcanic regions has been used for generations to produce power in geologically suitable parts of Europe, North America and New Zealand.

But Australia may be poised to take advantage of new techniques in which engineered permeability – enhancing natural fractures in granite trapped beneath layers of insulating rock using hydraulic stimulation – can create artificial reservoirs with temperatures of more than 250C.

Generating useable energy from hot rocks involves drilling two parallel wells. Water will be pumped down one well at extremely high pressure, passing through fractures in the granites and return up the other well. The super-heated water would then transferred up via a second well to a power station to generate steam and then electricity.

The super-heated water will be run through a heat exchange system before being re-injected into the engineered reservoir, after transferring its heat to another liquid used in a second closed loop to generate power at modular power stations above ground.

Geodynamics recently commissioned a report from the Centre for International Economics, which found that at a conservative estimate, Australia’s recoverable hot fractured rock resources could meet the nation’s current electricity consumption for 450 years.

Geodynamics claims this means geothermal energy could supply as much as 10% of Australia’s energy mix by 2030, even given predicted significant increases in energy consumption.

Great stuff. But so far not one joule of electricity has been generated in this way, and after two years of drilling and related activities, Geodynamics was not able to connect its Habanero-1 and 2 wells or even reach total depth of 4900m at Habanero-2.

But in its most recent quarterly report, the company claimed that despite the delays, it had demonstrated very good results throughout the year and had significantly advanced its proof of concept.

New managing director Dr Adrian Williams argues that the company has achieved much in the last few years and the hot rocks sector has a bright future.

“We’ve shown that from just one well, by injecting water into the existing fractures, we can enhance the permeability to produce a reservoir of say 3.5-2.5km, just from well,” Williams said.

He agreed that the company needed two wells, both connected to the underground reservoir, but argued that this could be achieved.

“All of the technologies that we need to drill successfully to 5000m and deeper exist, and we need to learn how to best use them in the context of the Cooper Basin,” he said. “It is that learning we are now going through.”

Despite the difficulties it is worth persisting, according to Williams.

Rival hot rocks explorer Petratherm, a spin-off of miner Minotaur Resources, agrees.

“Geodynamics are developing a known resource,” managing director Peter Reid said.

“What they’re really doing is testing. It’s really a proof of concept, whereas we’re coming at it from a step back and saying, ‘Well, maybe there are some other areas that are hot in Australia –and how do we go about finding them?’”

Petratherm aims to discover and exploit new opportunities in the sector.

“We saw there was a good opportunity there to explore for heat – as far as we knew, no one anywhere in the world had explored for heat. Having a strong exploration focus, Minotaur did a lot of research into what drives heat, and where are you likely to find it,” Reid said.

Despite their differing approaches, Petratherm and Geodynamics agree that Australia’s hot rocks resources are both massive and world class.

Just as conventional geothermal is dependent on natural features, hot rocks development has its own specific requirements, and Australia is thought to have ideal conditions. Large amounts of granite are heated by the radiogenic decay of minerals deep below the surface, under tectonic compression ideal for horizontal reservoirs, and this is capped off with kilometres of insulating sediment that traps the heat inside the man-made reservoir.

Once the technical challenges of drilling and constructing the binary system are resolved, geothermal electricity generation will be the easiest part of the development, according to Williams and Reid, as all of the technology already exists, and the power plants are already available off the shelf.

For smaller players such as Petratherm, who absolutely believe in the science of geothermal energy, the long-term goal is to establish commercially viable plants that are shallower than Geodynamic’s resource and thus easier to drill, and closer to market.

While Geodynamic’s resources in the Cooper Basin may well be the best in the world, they are still a long way from where the energy will ultimately have to be used if the 10% target is to be achieved.

Williams said once Geodynamics had achieved proof of concept and established a 40MW pilot plant, the company planned to continue building geothermal modules – each of which would require its own drilling program – to build a modular 280MW plant.

He is confident that Geodynamics will be able to get the energy generated in the Cooper Basin to market efficiently.

“The modelling that we’ve had done – we’ve had independent assessment on this – you’re looking at losses of about 5%,” he said.

“The transmission costs and losses are not a determining issue. The losses are low because one uses high voltage direct current [HVDC] lines, like BassLink or the Three Gorges project in China – all this technology is well and truly established.”

While Petratherm believes Geodynamics is getting great results, and supports the ramp-up for the 10% target once production has been achieved, Reid had reservations about the economics of HVDC transmission.

“It can mean the difference between making a project work and it not working. If you look at the wind industry, the best resources weren’t the ones that ended up being developed, simply because they couldn’t connect,” Reid said.

“The best wind resources were on the western Eyre Peninsula, and in the end, a lower quality wind resource with better connection issues led to the formation of Starfish Hill and all the other wind farms – they’re all right on the grid, essentially. That is a big issue.

“Certainly DC connections do provide low losses, but there are also great costs involved in constructing them that reduces the overall economics. At our Paralana project, we’re not ideally situated, but we think we’re much closer to the electricity grid than our competitors.”

Several other companies, including Green Rock, Eden Energy, Geothermal Resources and Green Earth have now entered the sector. In most cases, these are spin-offs or affiliates of mining or petroleum companies.

All of these players say they are convinced that Australia will soon have access to large amounts of renewable, clean energy.

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