Geothermal to power Australia’s future

WHEN it comes to renewable energy, geothermal projects are not usually mentioned in the same breath as solar, wind or hydro-electric schemes.
As the largest listed geothermal energy company in Australia, Geodynamics is hoping to change that.
Approaching its 10th year, the company is focussed on enhanced or engineered geothermal systems (EGS) and is the holder of a number of exploration tenements.
Its primary interests are in northeast South Australia, close to Innamincka in the Cooper Basin. Geodynamics also has tenements in Queensland and in the Hunter Valley in NSW.
Managing director and chief executive Geoff Ward said he believed that geothermal power had expanded rapidly in the last 30 years.
“There is around 11 megawatts of geothermal capacity worldwide and much of the development stemmed from the 1970s in response to the first Arab oil crisis,” Mr Ward said. “Geothermal energy is associated with oil and mud cooling, hot springs, spontaneous steam and hot water eruptions in places like Rotorua in NZ [New Zealand] and Iceland.
“The geothermal world has particularly focussed on volcanic resources in places like Iceland, New Zealand, [the] Philippines and parts of the west coast of the USA.
“Now it’s quite common sense that volcanic systems are closer to the surface, and heat that you’re capping in order to power the turbines can generate steam.
“Our focus is on geothermal systems that don’t rely on volcanic systems to generate heat.”
Geodynamics holds permits that cover about 4000 square kilometres in the Cooper Basin. About 970sqkm of this area is covered by a very large, high heat-producing body known as the Innamincka granite.
The Innamincka granite is buried to a depth of 3.7km, and extends between 5km and 10km downwards. The granite is heated due to the nature of the rock, the decay of internal minerals and its proximity to the molten core of the Earth.
“The granite itself is covered by very old sediment in the Cooper Basin, being an area that hasn’t been disturbed for a very long time,” Mr Ward said. “Those sediments [and] shales that Beach and Santos are drilling, and the artesian waters above it…insulate the granite to stop the heat escaping.
“That granite is heated up to the high 280 degrees as we get deeper, closer to 4700 metres into the granite. “We’re procuring EGS and enhanced geothermal that seeks to produce geothermal power from crystalline rock rather than volcanic deposits.
“This is a really novel development because it can open up a whole lot of locations to geothermal power that don’t currently have access to it because they are not volcanic.
“We are a global leader in this technology and that’s what makes Geodynamics particularly unique.”
Globally, there are only two non-volcanic geothermal demonstration plants in operation: in France (1.5MW) and in Germany (4.5MW).
The aim of the Innamincka Deeps joint venture (70 per cent Geodynamics and 30 per cent Origin Energy) is to establish the world’s third demonstration plant, planned to be commissioned in early2013.
The pilot program is attracting a lot of international attention as the identified granite is significantly hotter and provides higher flows than those being trialled in France and Germany.
“It is a globally-significant project: the resource itself has huge potential, [and] we have estimated and done initial studies that show that we’ll be able to exploit it efficiently and effectively to well
over 3000 megawatts over many decades,” Mr Ward said.
Habanero 4
To date, Geodynamics has drilled six wells at its Innamincka tenements Habanero 1-4, Jolokia 1 and Savina 1. The most recent well, Habanero 4, was completed in September to a depth of about 4200m.
Mr Ward said that being a pioneer in the area meant that Geodynamics had to recruit some of the world’s most experienced deep, high-pressure well drillers.
“Geodynamics actually drilled the first geothermal well in Australia in 2004, and we were followed by a number of companies,” he said.
“Wells of this type are extremely difficult, extremely complex, and there has been a lot of learning as we go along the way.”
Drilling of Habanero 4 was part of a two-year program by the company. The first step involved convincing JV partner Origin and the SA Government that engineering issues leading to the failure of the Habanero 3 well had been addressed.
“The Habanero 4 well is intended to be a production well, which will allow us to trial the system of power”, Mr Ward said. “We circulate brine fluid through an injection [in the] production well and
generate power from it.”
Mr Ward explained that it was important for Geodynamics to find the most efficient method for the creation and management of flow, and the way in which the systems of fractures deep in the granite behaved, to better understand and define geothermal energy potential. Once the Habanero 4 well is re-intersected with the fracture system created by earlier wells, Geodynamics will complete a series of small local stimulations to start open flow tests andput the well into production.
The next step will be the undertaking of a major stimulation program that will utilise naturally-occurring salt grind and a pressure pump to increase pressure in the well bore.
Micro seismic data will then be collected to measure movements in the fracture.
“[The program] actually enhances the permeability and the flow potential of the fracture system that is naturally occurring deep in this granite,” Mr Ward said.
“Over two previous campaigns undertaken in 2005 and 2008, we’ve seen the productivity of that fracture increase by between 60 and 1000 times. “We are looking to extend that experiment and understand how far this fracture keeps growing, if it increases in productivity the more we stimulate it or whether there is natural limit, and what direction it moves in and how it moves.”
The third part of the program will reconnect the Habanero 4 production well with the existing Habanero 1 well to create a closed loop and circulate the fluids from a reservoir.
A major energy producer
Considering the rising costs of traditional energy sources, it is somewhat surprising that commercially-viable geothermal power has only recently been developed. Mr Ward said three external factors had slowed the progress of the technology.
“Whether you are looking to develop a new mine or large offshore gas project, or – in our case – [a] geothermal [scheme], the key is securing long-term customers [by] demonstrating that you have a product that is able to be delivered at a price that customers are willing to pay; demonstrating that you have the engineering capabilities to actually carry out the project; and being able to resolve
infrastructure issues to ensure that your product can get to its end customers,” he said.
The capital expenditure required to build geothermal plants is considerable, and it often takes much longer to see results compared to oil and gas ventures.
“We’re pursuing a large, scaleable, low-emissions power technology and, when you look at those attributes, you can see why it’s a very attractive alternative with rising coal and gas prices, and also
rising concerns about emissions: not just carbon, but oxides and other emissions,” Mr Ward said.
“Not just in the next decade but in the decade beyond, you can see a very promising role for power generated through geothermal energy: particularly since the only other technology that brings together those attributes is actually nuclear.
“So you can see that geothermal is a clear alternative to nuclear in the long run in providing an amount of sustainable 24-hour, low-emissions power for Australia.”
Mr Ward said that becoming one of the major energy producers in Australia was a long-term goal for Geodynamics.
“It’s worth recalling that some of the overnight success in the energy industry was 20 years in the incubation,” he said. “With the example of Woodside, that was a small explorer in the 1960s before
becoming a powerhouse in the 1990s. Pacific Hydro has found overnight success but had more than a decade of development work before it found an appropriate match of resources and a market for its hydro project.
“There is a lot of uncertainty around at the moment around carbon price, around future power demand, and how the network will develop as people’s electricity-use habits change and as technologies change, so we’ve got to be part of that mix and debate in understanding what role geothermal can play.
“If you look at the work that was done by the Australian Federal Government in strategically reviewing Australia’s energy needs, energy resources and what would be the best energy policy for contributing to [the] sustained prosperity of Australia… that geothermal had a major role to play and that there was a significant incentive for Australia, in particular, to conquer some of the challenges described.
“We remain very positive that the problems that we are wrestling with are problems that are definitely worth solving and I think that if we can continue to demonstrate progress this year, then we
will continue what may be a long path: one which could lead to development of a very significant new industry.”

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