Gioia Falcone

Geothermal Case Study

Hot Sedimentary Aquifer (HSA) Resource in Australia

Washington D.C.

24-25 March 2014

What will we do in this session?

• Introduce geothermal resource types & existing classification frameworks.

• Present an Australian Geothermal Power Plant Case Study.

• Objectives: – Highlight complexity of standardising geothermal sources & product types.

– Dealing with established jargon/reconciliation with past proposed protocols.

– Outline how UNFC-2009 could apply to geothermal resources.

– Trigger discussions: • What types of geothermal resources could be classified under UNFC-2009? • Should we align with & bridge to existing protocols, and/or develop new

geothermal-specific sub-specifications?

2

Types of Geothermal Systems

• Requirements for a geothermal system to exist: – large source of heat – reservoir to accumulate heat – barrier to hold the accumulated heat

• Categories: – natural convecting vs. conductive – w/o natural hot fluid recharge – single-/two-phase flow – natural flow vs. pumping – natural vs. enhanced/engineered reservoir

3

Uses of Geothermal Energy • Direct Use & District Heating Systems use hot water from

springs or reservoirs near the surface.

• Geothermal Heat Pumps use stable ground or water temperatures near the earth's surface to heat/cool buildings.

• Electricity Generation via a power plant needs water or steam at very high temperature, 1-2 miles from surface.

• Combinations of the above

• Combinations with other renewables

• Combinations with conventional fossil fuels

4

Natural Geothermal Resources

(Dickson & Fanelli, 2004 )

5

Enhanced Geothermal Resources

(MIT, 2006)

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Geothermal Classification Schemes

• Differently from other renewables, several geothermal schemes have been already proposed.

• No universally recognised standards exist (yet). • Examples:

– Geothermal Reporting Code & Geothermal Lexicon for Resources & Reserves Definitions & Reporting produced by the Australian Geothermal Reporting Code Committee (AGRCC) [1st edition 2008, 2nd edition 2010]

– A Protocol for Estimating and Mapping Global EGS Potential, by Beardsmore et al. (2010).

– The New Geothermal Terms and Definitions, by the Geothermal Energy Association (GEA, 2010).

– The Resource Assessment Protocol for GEOELEC, by van Wees et al. (2011).

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Existing Jargon

(AGRCC, 2010)

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Classification vs. Project Maturity

• Pre-drilling exploration • Post-drilling exploration • Appraisal • Development • Asset disposal/sale/swap • Abandonment/decommissioning

Is one classification scheme sufficient?

9

Case Study • From “Statement of Estimated Geothermal Resources For the Koroit

Geothermal Power Project, Victoria Geothermal Exploration Permit (GEP) 8” (Hot Rock, 2009) [downloadable from the www] [This is a synthetic case. No independent assessment or judgement of statements/assumption/results contained in the reference was made for the purpose of this exercise.]

• Existing assessment according to AGRCC (1st edition, 2008).

• Logic to be applied in this exercise: – How does AGRCC jargon translate into UNFC-2009? – Does the final classification align with equivalent UNFC-

2009 categories? – How does this example compare to different types of

geothermal resources?

10

Geothermal Reservoir Type

• HSA reservoir consisting of porous & fractured sedimentary rocks of the Crayfish Subgroup.

11

Location Koroit geothermal resource within Geothermal Exploration Permit GEP-8.

12

Existing Infrastructure & Nearby Petroleum Wells

13

Proposed Project Scheme

14

Existing Data

• Extensive seismic surveys & exploration well data from the petroleum sector over the past 40 years.

• 14 oil & gas wells drilled in the Koroit area.

• Data confirm exploitable geothermal conditions at Koroit from direct measurements.

• Primary permeability associated with interconnected porosity. Secondary permeability associated with post depositional faulting & fracturing.

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Temperature Data

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Permeability Data

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Parameters Used for Monte Carlo Analysis -1

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Parameters Used for Monte Carlo Analysis -2

No recoverable energy!

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Results: Heat-in-Place only

Under the AGRCC 2nd edition, only “recoverable energy” may constitute geothermal resources.

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Parameters Used for Monte Carlo Analysis -3

To go from heat-in-place to recoverable energy 21

Power Potential from Heat-in-Place

(AGCC, 2010)

Rf = QWH / QR QWH = heat at wellhead QR = heat in the reservoir

(Muffler, 1979)

for liquid-dominated systems

22

Reconciling AGRCC nomenclature to UNFC-2009

• AGRCC conforms to the International Reporting Template (CRIRSCO, 2006) that covers the public reporting of exploration results, resources and reserves for the global mining industry.

• Bridging document between CRIRSCO/UNFC-2009 is included in Annex III of UNFC-2009.

Does this mean that AGRCC can also be aligned?

23

Mapping CRIRSCO to UNFC-2009

G axis maps directly to CRIRSCO . E and F Categories set minimum standards for UNFC-2009 Classes.

24

Mapping AGRCC to UNFC-2009

Proposed by Beardsmore (2013), not evaluated by EGRC.

25

Mapping PRMS to UNFC-2009

Using a system for fluids more suitable for geothermal? However, hydrocarbon accumulations are finite, geothermal can recharge. 26

Compatibility of AGRCC and UNFC-2009

• Is a solid minerals system the best starting point?

• Inconsistent statements in AGRCC, e.g. “It is more likely than not that the Geothermal Reserve estimate is correct, reflecting a greater than 50% chance of occurrence”.

• Fluids production requires continuous distribution of uncertainty.

• PRMS states “at least a 50% probability that the actual quantities recovered will equal or exceed the 2P estimate”.

• Is supporting explanation for the G categories sufficient?

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Competent Person: UNFC-2009

• Except where constrained by regulation, assumptions of future market conditions should reflect the view of either: a) The organization responsible for the evaluation; b) The view of a competent person or independent evaluator;

or, c) An externally published independent view, which is

considered to be a reasonable forecast of future market conditions.

• Evaluators must possess an appropriate level of expertise and relevant experience in the estimation of quantities associated with the type of deposit under evaluation. More detailed specifications can be found in relevant commodity-specific systems that have been aligned with UNFC-2009.

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Competent Person: UNFC-2009 /cont’d

• Note that "competent person" may be defined by regulation.

• In addition, regulatory bodies may explicitly mandate the use of a “competent person”, as defined by regulation, with respect to corporate reporting.

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Competent Person: AGRCC 2010

• All Public Reports must include a statement of consent by the Competent Person.

• 2 pages defining Competence, Responsibility and Accountability / Competent Person.

• Annex 1: Competent Person Accountability - Complaints and Disciplinary Procedures.

Is it the same for the other renewables?

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Opening up to discussions - 1

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• Can ALL types of geothermal resources & uses be classified under UNFC-2009?

• Is it correct to assume that CRIRSCO is the closest analogue to AGRCC, and so use the existing CRIRSCO/UNFC-2009 mapping?

• Geological (G) axis and Heat-in-Place concepts are fundamental for geothermal – can this be reconciled with other renewables?

Opening up to discussions - 2

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• Are recharge (natural or artificial) & rate of extraction – key to geothermal systems – properly accounted for by UNFC-2009? – Can UNFC-2009 distinguish between “economic” &

“sustainable” potential? – Can this be clarified by geothermal sub-specifications?

• Role of “Competent Person” for renewables?

• Can the E3-F4-G4 combo capture national

estimates of geothermal “theoretical potentials”?

Opening up to discussions - 3

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• What does the geothermal community need from a classification scheme? – Financial reporting? – “Potential” estimates?

• Can UNFC-2009 offer a better platform for classifying geothermal resources at different levels of project maturity?

• How to proceed: – align with & bridge to existing protocols, and/or – develop new geothermal-specific sub-specifications?