August 2008

IEA-GIA/EDC Joint Geothermal Seminar

Tagaytay, Philippines, September 21, 2013

Adrian Larking – Green Rock Energy Limited

Barry Goldstein - Government of South Australia

Robert Hogarth – Geodynamics

Peter Reid – Petratherm

EGS Permeability EnhancementAustralian Experience

Australian Geothermal EGS Activities

■Overview of past geothermal activities

■Update of key projects

■Lessons learned & future directions

2

Overview of Geothermal in Australia

• 9 ‘deep’ wells drilled to reservoir depths by 3 different companies/ Joint Ventures

• 7 are EGS wells, 2 are HSA wells. 6 of the EGS wells have had major hydraulic stimulation

� EGS projects all in South Australia

� EGS projects at reservoir depth:• Petratherm – in Mesoproterozoic

metasediments• Geodynamics

- in granites below complex Cooper sedimentary basin, a petroleum province;

- 1MWe capacity pilot plant commissioned

Image courtesy Panax Geothermal

Why EGS in Australia?

Below Ground actors

� Extensive radiogenic basement (heat source) below insulating sediments

� Australia n plate converging with Indonesia – giving rise to horizontal compression and common naturally occurring horizontal fractures (reservoir)

Above Ground

� Land access / title to resources� Government stimulus for low emission

renewable energy RDD&D

� Market recognition of extensive, hot rocks

� Political will to attain energy security & mitigate risks of climate change

� Growth in energy demand

Temperature at 5 km, Somerville et al. (1994)Temperature at 5 km, Somerville et al. (1994)Temperature at 5 km, Somerville et al. (1994)Temperature at 5 km, Somerville et al. (1994)

Rosemanowes Cornwall, UK

1984-91

Fenton Hill, Los Alamos

USA 1970-95 500 metres

Soultz, France

Since 1987

Epicenters of stimulated fracture growth

Courtesy of Geodynamics

EGS Trials (Displayed)

• Fenton Hill, USA: 70 –95

• Fjalbacka, Sweden: 84 - 88

• Rosemanowes, UK : 84 - 91

• Hijiori, Japan: 85 - 00

• Soultz, France: 87 – Current

• Ogachi, Japan: 89 - 00

• Habanero, Australia: Current

• Bad Urach, Germany: Current

• Basel, Switzerland: Abeyance

• Landau, Germany: Current

Engineered Geothermal Systems - Seismic Cloud, Plan View, Same Scale

Habanero 1, 2 & 3 South Australia2005- ongoing

Australian EGS

> 4x’s than

attained

elsewhere

EGSWater is injected under pressure into naturally fractured rocks to increase the intensity and extent of fractures. The micro-shifting of rocks during that fracture stimulation process is located in the same way epicentres of blasting and earth tremors are determined

Olympic Dam Project

4km

Approximate

Scale

Blanche 1

2000m

8000m

4000m

6000m

0m

1590Ma GraniteResource

Reprocessed Geoscience Australia Seismic Line

Cover Sediments

Cored well drilled 1954m into granite at a site where natural fractures were apparently not abundant

Analysis of stress field in 1954m well from diamond drill core, borehole breakouts, impression packer, core-discing & hydraulic injection testing:

• Winch & wireline hydraulic packer system allows injecting without a rig

• 71mm inflatable straddle packers

– system operable up to 100ºC, 60MPa

– packer test interval 0.7m

– Water injected via (10mm) coiled tubing

– limit of tool about 40MPa differential P

– Maximum water injection rate is 12 l/min.

• Below 1700m the minimum principal stress is vertical which should result in horizontal hydraulic fracture plane

• Small scale hydraulic injection has opened fractures in the granites but with low permeability

Olympic Dam – Hydraulic Injection Test

Petratherm’s Paralana, Arrowie Basin

� Targeted fracture permeability in Mesoproterozoic metasediments above hot granites

� Fractured sediments were overpressured

� Successful fracture stimulation

� Lessons learned

� need to target natural fractures to obtain sufficient total flow rates

8

,4

Petratherm Flow Test of Paralana–2, Oct 2011

2011

• 1.28 million litres of brines (22.4MPa over-pressured) from fractured meta-sediments from 3670 to 3864m

• Bottom hole temperature 190°C (4030m)

• Fracture stimulation & flow testing produced 1.28 million litres fluid at flow rate of1-6 l/s

• 171°C from bottom 200m tested

• Image courtesy Petratherm

2013-2013 Planned Activities

� June 2013 –granted A$13 million (requires matching funds) for 7MWe project by ARENA for research into site’s commercial potential

� $24.5m to be used :

• from late 2013 - drill Paralana 3 deep production well & carry out hydraulic stimulation of Paralana 2 & 3

• 2014 circulation and flow testing

• 2015 commission 3.75 MWe plant & connect to Beverley U mine 10km away

Geodynamics 3 EGS Fields

Cooper BasinHabanero EGS Field

� 4 stimulated wells >4500m into fractured, >250°C over pressured granite

� Granite reservoir stimulated

� Connection between HAB 1 & HAB 3 proven via tracer & pressure testing

Jolokia & Savina EGS Fields

� 1 well in each field – Jolokia 1 (4911m), Savina-1 (3700m)

� Jolokia reservoir is hotter but tighter than Habanero & had drilling mud problems

Image courtesy Geodynamics Ltd

,4

Habanero Field

Stimulation and Circulation Experience

(see presentation prepared by

Robert Hogarth of Geodynamics)

11

▐ Geothermal drilling engineering experience & expertise is essential

▐ Main EGS resource challenge is not temperature but to engineer

sustainable reservoirs with sufficient permeability and size

▐ Inadequate permeability obtained to date from engineering fractures in large

open hole sections

▐ Multiple fractures/faults are required to provide sufficient flow

▐ Advisable to target natural open fractures and enhance natural permeability

to attain sufficient sustainable flow rates

▐ Natural open fractures are mostly water saturated, some are overpressured

▐ Geodynamics says it’s challenge is to complete at least two zones/well

▐ Two EGS projects in South Australia are moving forward with operations

scheduled for the next 12 – 18 months

� Geodynamics EGS project in the Cooper Basin – now on reduced scale, needs

to find local markets.

� Petratherm’s Paralana Project in Sth Australia – is seeking A$5 million

Lessons Learned

August 2008

Thank you

Contact us at:Adrian Larking – Green Rock Energy Limitedalarking@greenrock.com.au

www.greenrock.com.au

Barry Goldstein – Government of South Australia

Barry.Goldstein@sa.gov.au

www.dmitre.sa.gov.au