First ARENA grant to unlock riddles of geothermal wells

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The Australian Renewable Energy Agency has made its first cash grant… and it goes to a geothermal drilling study.

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The first grant to be made by the newly formed Australian Renewable Energy Agency (ARENA) has been announced, with a modest sum of $1.25 million going to assist a $3.5 million geothermal research program.

ARENA was formed on July 1 and has $3.2 billion under management, including about $1.7 billion that has yet to be allocated. The geothermal grant comes from the Emerging Renewables Program, which had a nominal $126 million to spend.

The program is being undertaken by the South Australian Centre for Geothermal Energy Research at the University of Adelaide, along with developers Goedynamics, and Panax Geothermal, and will focus on work to better understand and predict the permeability of geothermal drilling wells.

This could help collate more accurate data and increase the bankability of geothermal wells in hot sedimentary aquifers, which have struggled to gain financing, and the few that have been drilled have obtained mixed results.

“Understanding permeability, or the ability of a rock to allow fluids to pass through it, is essential to predict the potential for geothermal energy generation from hot water that is circulating deep underground, known as hot sedimentary aquifers,” federal energy minister Martin Ferguson said in a statement.

“If we can predict well permeability more accurately companies can better determine exploration and production sites, leading to lower costs and risk in the geothermal industry.”

Ferguson noted that the two geothermal wells drilled in hot sedimentary aquifers reservoirs in Australia had achieved fluid flow rates that were significantly lower than expected. Those two wells were drilled by Panax in the Otway basin, and by an Origin-led joint venture with Geodynamics in the Cooper Basin.

“This project will help address two important technical challenges confronting the geothermal energy industry in Australia: well drilling practices to assess potential damage to the rock during drilling and evaluation of the anticipated fluid flow rates,” Ferguson said.

Panax said the initiative could have major implications for the viability of Australia’s geothermal resources.

Managing director Kerry Parker said that the project had the potential to provide key insights into the drilling, completion and potential next steps of its Salamander 1 well. The first well produced steam, and the promise of cheap energy, but complications found during well-testing have clouded the project.

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2 Comments
  1. Matthew Wright 7 years ago

    More money to be wasted on unconventional geothermal for electricity production. It’s not commercial and there is no trajectory of cost reduction in the technology that says it will ever crossover with conventional power costs.

    Lets get researching and deploying Wind, Solar Thermal w/storage and solar photovoltaic which are technologies that we know are riding a significant cost-curve.

    Lets also play a bit more in R&D and commercialising wave power which has some promise.

    Geothermal in Australia is only exciting in Australia as a cultural phenomena. Australian miners and politicians are obsessed with digging and drilling.

  2. Limen Wrinkle 7 years ago

    Geothermal energy from hot sedimentary aquifers is in fact a conventional method of electricity production. It is just that in Australia we have been lagging dramatically in support of renewable energy. Australian geothermal energy companies are now rapidly scouring better supported overseas prospects. Even in Indonesia the new feed-in tariffs range over US$120 to US$170 per MWh which will ensure that that nation will romp ahead in development in a few years time leaving Australia in its wake.

    Geothermal energy is one of only two sources of reliable base load GHG free energy, available 24/7/365 days in the year. The other is nuclear.

    However, here it is still in an early stage of development. What better source of clean energy is there? Innovative projects with great potential need time and funding support. This ARENA grant provides just a tiny bit.

    Wave power also has a much greater reliability than wind and the southern coasts of Australia have superb potential.

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