Hot rock energy a step closer

Adelaide Advertiser
12 July 2011, Page: 29

Fracturing work has begun at Petratherm's Paralana project in the state's north in a major milestone for the geothermal player. Fracture stimulation, or "fracking", attempts to create seismic events almost 4km underground to increase the size of a potential geothermal reservoir. With joint venture partner Beach Energy and contractor Halliburton, Petratherm has begun pumping fluid into the Paralana 2 well to create fractures in the hot rocks used to produce geothermal energy.

Achieving a successful fracture event is a major hurdle for the company to demonstrate that generating electricity from hot rocks in the state's far north is viable. The Paralana resource with multiple wells is estimated to be able to produce 13,000 MWs of power, about four times the state's current energy use. Petratherm managing director Terry Kallis said the fracture work had begun yesterday morning and was progressing well. "The fracture process that is underway is a major milestone for the project and very important for the geothermal industry", Mr Kallis said. "To be able to show you can create the reservoir is a major step in de risking the project (and) we are quietly confident we will be able to propagate fractures beyond 500 metres".

In January the company did a "minifrack" at the project that produced seismic events about 300 metres from the bottom of the well after two hours of pumping. This week the company will use 8500 horsepower pumping capacity to inject fluid at 9000 psi of pressure into the well increasing progressively over several days. "The further it goes the better it is, because it gives us more rock to access and more heat to strip from the rocks", he said. "The process involves water under pressure at increasing pumping rates, which is expected to create many more fractures than what was created during the minifrack".

The work will allow the company to determine where it drills the Paralana 3 well to create production for the geothermal system. Once the production well is drilled, the company will undertake circulation testing to confirm target flow rates as the next step towards a commercially demonstrable, enhanced geothermal system power plant. It comes as geothermal industry shares recovered yesterday on the back of the Federal Government's proposed carbon price.

Petratherm's shares closed 15% higher at 19¢, GeoDynamics 25% higher at 42¢, Torrens Energy 42% higher at 7.5¢ and Panax Geothermal 26% higher at 2.9¢. Australian Geothermal Energy Association chief executive Susan Jeanes said geothermal energy was the only baseload renewable technology on the horizon capable of replacing large coal generators. "The price on carbon provides a foundation for the development of clean energy projects into the future but other incentives must be effectively built on it to drive investment in renewable energy projects", she said.

GeoDynamics, which is developing its project at Innamincka, welcomed the Federal Government's climate change initiatives. "Clearly we are a big winner from the carbon tax and it is great news for the industry", GeoDynamics CEO Geoff Ward said yesterday. "I am also delighted for long suffering shareholders and it also augurs well for the proposed development of our pilot plant next year". Mr Ward said having a carbon price and the Clean Energy Finance Corporation and Australian Renewable Energy Agency to administer more than $13 billion of investment in renewables would be a significant boon for the sector.