Hot rocks power company seeking customers
The company has spent more than $400 million since listing in 2002, including buying equipment and drilling. Its 1-megawatt Habanero pilot plant was commissioned on April 30 and has been operating in excess of expectations since, said chief executive Geoff Ward.
"We're delighted by how stable and reliable" the operation has been, he said.
The geothermal plant at Innamincka taps salty water heated at 210 degrees more than 4.2 kilometres below the surface, extracting the heat to generate electricity. The cooled brine is then pumped back down a separate well where it is reheated by the hot rocks, creating an energy loop.
Only two other sites now operate so-called enhanced geothermal systems, at Soulz in France and Landau in Germany.
Geodynamics will only proceed with a 5-10 megawatt commercial plant if it can secure customers.
Potential clients include Santos, which operates its own gas and oil hub at Moomba, about 70 kilometres away. Beach Energy and Chevron, meanwhile, are exploring for unconventional shale gas within 5-15 kilometres of Geodynamics's wells.
All three had representatives visit Habanero on Monday, with federal Resources and Energy Minister Gary Gray and his predecessor Martin Ferguson.
"We've had initial discussions with [the three energy companies] and they are very open to acting as our foundation customers," Mr Ward said. "We think our resource is a pretty natural fit with their long-term gas operations."
Geodynamics is yet to complete its feasibility study but the cost of developing the commercial plant is targeted to come in below $150 million.
It had more than $40 million in cash at the end of June, and is continuing its exploration of a more conventional geothermal project in the Solomon Islands. It expects to be drilling its first wells on Savo Island by the middle of next year. The plant and a sub-sea cable link to of Honiara will cost about $150 million.
Frequently Asked Questions about this Article…
Geodynamics' Habanero pilot is a 1-megawatt enhanced geothermal pilot plant in the Cooper Basin near Innamincka. It taps hot saline water more than 4.2 kilometres below the surface to generate electricity and was commissioned on April 30, operating better than expectations.
The enhanced geothermal system pumps salty water through wells to tap heat from hot rocks about 4.2 km underground where temperatures reach about 210°C. The heated brine generates electricity at the surface, is cooled, then pumped back down a separate well to be reheated, creating a closed-loop energy system.
Geodynamics plans to proceed to a 5–10 megawatt commercial plant only if it can secure customers. The company aims to sign its first customers at the Cooper Basin site within six to 12 months to allow development of the commercial plant, subject to completing feasibility work.
Potential foundation customers mentioned in discussions include Santos (which operates a gas and oil hub at Moomba about 70 km away), Beach Energy, and Chevron — the latter two are exploring for unconventional shale gas within 5–15 km of Geodynamics' wells.
Since listing in 2002 Geodynamics has spent more than $400 million on development, equipment and drilling. The company reported having more than $40 million in cash at the end of June, and it is aiming for the commercial plant development cost to be below $150 million.
No — the article notes only two other operating enhanced geothermal systems at the time: Soulz in France and Landau in Germany, making Geodynamics' Habanero one of only a few such projects internationally.
Geodynamics is also exploring a more conventional geothermal project in the Solomon Islands. It expects to be drilling its first wells on Savo Island by the middle of next year, and estimates the plant plus a subsea cable link to Honiara will cost about $150 million.
Investors should watch for customer commitments for the Cooper Basin site (the company aims to secure these within six to 12 months), completion of the feasibility study for a 5–10 MW commercial plant, progress on the Solomon Islands drilling program on Savo Island, and updates on project costs and cash position.
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