Drilling advances: Could drilling save the world?

FORD BRETT, Contributing Editor

The elevator speech of those last six articles: Drilling has improved a lot in the past dozen years.  Quantitative performance has improved by some 250% (in terms of ft/day), and qualitatively wells are, on average, more challenging and importantly safety is better.  Drilling advances have provided one of the pillars that has made unconventional possible.  Things are not perfect though, whenever activity goes up performance and safety get worse – this means the industry has problem replicating what it already knows.  These ‘performance twist-offs’ have cost the industry ten to twenty billion dollars in the last ten years.  We’re good but can clearly do better.

Past articles have shown that the keys to preventing performance twist-offs and continued improvement are technology, people and processes. 

Refer to my last column, Drilling advances: How to make the pie bigger, if you are interested in the complete story.   I try to make each of these helpful as stand-alone missives, but there is a red thread running through them all and prior articles might be useful for new readers.

The next few columns are going to switch gears and focus on the future by looking at what further advances in drilling could do for our industry.  The next few will focus on the geothermal opportunity.  

GEOTHERMAL ENERGY: EITHER IRRELEVANT OR LIMITLESS

The case for geothermal as irrelevant: Conventional geothermal does work in the very rare places on earth.  There needs to be very high heat is near the surface, thermal convection flows, large recharging sources of natural water (flows are often >50,000 bwpd), and a very good natural plumbing system (fracture network).   When these very rare geologic conditions exist geothermal can be valuable because it offers 24/7 baseload, is long lived, has low operating costs, and can be competitive depending on the cost of capital.  But these circumstances are so rare, they are essentially irrelevant on a global scale.

To show how irrelevant it is, according to the IEA in 2021 geothermal accounted for less than 2% of renewable electricity, renewable electricity is <8% of total electricity, and electricity is ~20% of total energy use — that all means that geothermal provides about 0.03% of humanity’s total energy needs.  By the way, the U.S. is the world’s largest generator of geothermal electricity and with Indonesia, the Philippines, and Türkiye generates about 60% of the world’s total.  Geothermal energy is good in the way diamond mines are good — if you have one it’s great, but you rarely can find one.  But at the global scale, conventional geothermal energy is a non-issue.  

The case for geothermal as limitless: Stand back and squint though, and geothermal energy is everywhere.  There’s enough energy in the Earth’s crust, just a few miles down, to power human civilization for millennia (Fig. 1). The ARPA-E project AltaRock Energy estimates that “just 0.1% of the heat content of Earth could supply humanity’s total energy needs for two million years.”  NREL estimated there is 200,000 exajoules (1 = 277 TW) of extractable geothermal energy in the U.S.  2% could supply 2,000 times the primary energy needs for the entire country without technology changes — it is technically feasible, but that doesn’t mean it’s economically feasible.

Fig. 1. Geothermal Opportunity Geophysical Drivers

Seems to me that geothermal energy kind of mirrors the situation shale faced twenty years ago: We knew the shale had hydrocarbons, and we know there is loads of them — we just didn’t know how to economically get it.   The key to unlocking unconventional was reducing cost and increasing output to the point that it made economic sense.  Drilling Advances were no small part of that equation.  The rest of this edition and the next few articles will explore the challenges to making Geothermal economic… Spoiler alert: Without drilling advances, it won’t happen.

THE FLAVORS OF GEOTHERMAL ENERGY

The following is a very brief tutorial on how geothermal energy can be used; I’ve included the first two for completeness, but the big opportunity is making the final three economic. 

Geothermal heat pumps: This is relatively common and can be very good for heat (and sometimes cooling), but it is small scale, and while it will help it is not a path to net zero.  It doesn’t involve oilfield drilling technology – so while it can be good, it’s not a topic for a Drilling Advances column.  For the curious, it’s basically a heat pump that uses heat from the earth as a sync instead of the atmosphere.

Conventional geothermal: I’ve already described that these are like ‘diamond mines’ – they work great where very unique geologic situations exist, those situations are very rare.  If you are interested the U.S. DOE has a good description of how in a few select areas (think parts of Iceland or California), heated water/steam heated rises through hot rock full of fissures and fractures, and it trapped under a caprock (Fig. 2).  Drilling can access these rare but giant reservoirs of pressurized hot water and use the energy to produce electric power.   Places where conventional geothermal can work are rarer than hot springs. 

Fig. 2. Conventional Hydrothermal Resources (Source: U.S. DOE)

Hot Dry Rock (HDR) geothermal: The idea here is to “build” a heat exchanger by fracturing between two wells, circulating some sort of working fluid to bring heat to the surface, and then using that heat energy in applicable processes or to generate electricity.  The idea is simple, and technology exists to make it happen, but there are many challenges to making this economic.  This resource is below the feet of every human on the planet – as mentioned above enough energy to meet human needs for >1 million years – IF (note the big “IF”) it can be done efficiently enough.  A future column will detail some of the challenges and possible opportunities to make HDR practical.  A starter list of these challenges includes drilling in very high temperatures, drilling long intervals of igneous rocks, harmful contamination of the working fluid, induced seismicity, loss of the working fluid to the subsurface, not to mention leasing and permitting.  To boot, seismic imaging is problematic in the basement making it harder to explore, and like all renewables, it is also very sensitive to the cost of capital.  Another non-trivial concern is that while the heat will continue to be conducted from the earth’s interior essentially forever, it is very possible to ‘mine heat’ by pulling it out faster than it can be conducted from the interior which means there will be a ‘decline curve’ of some type on these projects.  That can affect economics.  We know the energy is there, we even know how to get it.  The trick is doing it efficiently enough. 

Fig. 3. Hot Dry Rock Heat Exchanger (Source: GeoEnergie Suisse)

There are several well-funded, well-reasoned projects underway to try HDR.  The following is a short summary and links to more information.  Geo Energie Suisse is a consortium of Swiss power companies with a project now drilling.  Figure 3 shows a concept in which they will “make a heat exchanger below at about 2.5km below surface and circulate fluid to generate electricity.”  The U.S. Department of Energy (DOE) and Occidental Petroleum’s (Oxy) Geothermal Limitless Approach to Drilling Efficiencies (GLADE)  project is set to start drilling two wells in the DJ Basin for purposes of seeing how it might be possible to drilling granite (or other igneous rocks like Gneiss) efficiently enough to make geothermal economic — at least where heat might be near the surface.  That project should start soon, and the information will all be public domain.  In addition to those two, the UtahFORGE in the U.S. is one place doing basic and applied geothermal research, and GA Drilling in Germany has an active demonstration project underway.  

Advanced Geothermal Systems (AGS): The idea here is similar to HDR geothermal, but with a completely enclosed system.  AEGIS-CH is another Swiss academic and industry consortium investigating this approach (Fig. 4).  Basically, you need two wells to intersect each other and be cased – difficult but possible thanks to the oilfield. Then you circulate a fluid extracting heat.  As compared with HDR you could use a thermal syphon so that you don’t need a pump, there are no fluid contaminants, but the ability to extract heat is lower because of much lower surface area – that might mean it’s too short lived.  They often use Rankin cycles w/ organic fluids that would boil at +/-75C, so you won’t need as hot of rock.  Of course, downsides are this is tricky — which can mean expensive.  If we can do this effectively enough, there are a lot of potential locations.   

Hot Sedimentary Aquifer (HSA): Conventional geothermal works almost exclusively in igneous rocks.   The idea here is similar but to apply the technique to sedimentary rocks.  This opens up much more potential resource than conventional geothermal.  Rocks don’t need to be as hot, but since this approach often uses organic Rankin cycle fluids, very high temperatures are not needed.  Something >120C is probably ok, but hotter is even better.  This could make sense in an oilfield because it can benefit from oilfield infrastructure and leases.  It has the advantage of not needing fracing – in fact you don’t want to frac.  Because the drainage areas are very large, these projects would likely be longer lived and induced convection in the reservoir could be beneficial.  There are several organizations looking at this approach.  One notable project underway in the DJ basin Colorado is an JV with Geothermal Technologies ORMAT and others.

Fig. 4. Advanced Geothermal (Source: AEGIS-CH)

Downsides to this approach – besides it being ‘tricky’ – are that you do need something >200mD reservoir permeability (pumping at 36k bwpd); and like all these approaches is sensitive to the cost of capital.

CAN DRILLING SAVE THE WORLD? 

Under every person on the planet there is hot dry rock containing enough energy to meet 24/7 power needs for generations and generations.  We even know how to get it — at least in most places.  The problem is that it’s too expensive. 

Our situation reminds me of a wellsite supervisor I knew who once told me: “I had a gold claim in Alaska that I used to work.  I could get $1,000,000 an acre of gold by working the riverbed.”  As I was wondering why he was babysitting wells, he then said: “But it cost me $1,000,010 to get it.”  Future columns will look at some of the nuances and possible ways that drilling (and fracing in the case of HDR) could “save the world” with geothermal energy.

I’ll continue running this thread in the next column but to summarize for now:  If the industry can figure out how to reduce the cost of geothermal projects (wells and surface equipment) for about as much as they did for unconventional, then enough geothermal energy exists on this planet for us to never worry about energy again… but it will take tens of thousands of rigs to make it happen.

Until next time, I hope to start a conversation with any of you on how we can all help drilling advance.  If you have any ideas, please email me at ford.brett@petroskills.com and I promise I’ll respond.