You're listening to Redefining Energy. Your co hosts from Berlin Girard Reid and from
London Lawrence Seglent today on Redefending an ergab It's September and you're probably too young
to remember, but in the seventies there was this group called Earth, Wind
and Fire. Do you remember Do you remember September? I don't remember September.
I know the name of the pan, but that is you're my age.
But first of all, from my partner, this podcast is powered by
AXPO and international leader in providing sustainable energy solutions for the future in an ordex.
AXPO has been a pioneer within trading and origination services for the last twenty
years. So earths, win and fire. We talk about solar so fire
a lot, we talk about wind a lot, and now we're going to
talk about Earth. We're going to talk about Jill Thurmon. Very good and
actually I like the way you put it now, Max as we earth,
wind and fire, because the wind and fire is what we talk about all
the time, but we've just we don't talk about Earth at all. And
actually Earth copy is just as important as wind and fire. Right in my
opinion, this is the dawn of a new age. We had this geo
thermal industry tagging along, but really a little niche been there for decades.
And if I look at the US figures, which is the main market,
that old technology, which is now called hydrothermal, only represented four you get
one of capacity, so it was like zero one three percent of the global
fleet. So nobody was really very interested. And all of a sudden,
things you know, start shaking. Now we see new technologies arriving. I
think one of the most important is that they finally adapted the drilling techniques of
the oil and gas industry to joe thermal. Yeah. Well, let's actually
say it's not just the oil and gas industry, it's the shape industry,
right. It really is what we've seen in terms of alcohol decentralized drilling.
The innovation that we've seen in the US in the last decade has been nothing
sinse a phenomenal and it's a well to geo terminal and basically nobody stopeder.
Yeah. About two months ago there was this big announcement by a startup called
Fervo Energy that they had managed to run a well for one month. They
raised one hundred and eighty million dollars from investors, and they drilled at two
thousand meters deep and then they made an original drilling of one kilometer and they
managed to flow water to do aservoir and it came back at two and the
flow of sixty three lyters per second. I don't know if it's good or
not, but if you look at the investors, you have a Stanford,
Princeton, Macquarie, be HP, Breakthrough, Capricorn, Congruent, Devon.
Who do you think is the most important of those invest all Devon exactly?
And why because they're drilling company, right and they're conventional drilling Sorry when I
say conventional, sorry, they're fossil fuel drilling companies. You need their experience
such a booles But it's even more than that because Devon Energy is the company
who acquired Mitchell Oil and the guy who invented horizontal drilling and fracking is George
Mitchell. Yeah, very good. So in fact you've got not only they
use the same techniques, but these are the same companies. Cool. In
order to talk about those neutral thermal techniques, we have invited Cyndi taf and
she has had a thirty five year career in the oil and gas industry,
most recently vpah shell un conventional wells operation. Now she has a startup call
of Sage Energy which is focusing on exactly the same techniques. But let's bring
around the shows of the conversation. Cindy, welcome to the show. Thank
you. I'm happy to be here. First question, very simple, what
is joe thermal? Literally? What's happening? From a technical point of view,
I guess you drill and what do you get out of the drilling like
hot water? How does it work? If you think about the geothermal systems
that are out there, you need to think about geology, and so most
of us think about Iceland or the geysers of California when we think about geothermal.
So these are geothermal systems that rely on hot aquifers to produce heat and
steam to the surface in order to bring the heat of the earth to the
surface to use for electricity or direct heat use. This geothermal has been around
for a hundred years. The challenges it is limited geographically it represents on about
two percent of the geothermal resources around the world. Most of the resources are
actually contained in what we call hot dry rock, so rock that has the
heat but does not naturally flow water or steam to the surface. So what
you have to do in hot dry rock you have to create an artificial reservoir
or think of it as a tank through which you then circulate a working fluid
such as water, to harvest the heat and then to bring that heat to
surface. So these are called enhanced geothermal systems, and there's huge opportunity there.
That's the future. So first, what you're telling me is that the
classic way of doing joe thermal, whether it's Iceland, California, probably sus
of Italy, Japan, and of course all look like very volcanic area,
that type of joe thermal as kind of reaches natural limit. So now if
we really want to use the heat of the to produce twenty four seven carbon
free energy, we need to use different techniques. And because we use different
techniques, we somehow can do it elsewhere. That's correct. The conventional geothermal
resources they're near the ring of fire, they're near volcanoes, so you have
to have very specific geological circumstances in order to have those geothermal resources, and
so yes, they're limited. Whereas if we can crack the nut on this
new geothermal hot dry rock. You can literally put geothermal just about anywhere.
And when I say just about anywhere, anywhere that you can drill to the
debt to get the heat in order to be economically viable. So it's all
about debt. Now. If we again have been in Iceland, so I
went to the Blue Lagoon, and I mean, I'm not doing some advertising,
but it's a very nice place. I guess they drill like probably one
or two hundred meters in the case of your hot rocks. How deep would
that be? I guess probably more absolutely, So we're targeting drilling for one
hundred and fifty degrees see temperatures at the targeted rock or formation. And so
these depths are anywhere from three thousand meters to say six thousand meters, and
they're all reachable with current oil and gas drilling and completion technologies. Now there
is space age drilling out there, and we can talk about that later,
but those are the depths that we're targeting and the temperatures that we're targeting.
Can I ask you just to if I look at conventional geotomer, for me,
it's always been about power production. But if I look going forward,
we've got one really big issue to solve, and that's actually heat. How
do you decombonize heat? So if I take a district heating system, so
like I live outside Berlin, it's the biggest district heating system in Europe,
I look at that and go, how the heck are you going to decombonize
that? And looking at my goal, it's difficult, but actually geothermal is
probably the obvious way to do it. So what you're doing is you're creating
heat and electricity. Could you talk a little bit about that? Am I
just you're not dreaming because that's what they're doing in Denmark right now in the
second city of Denmark called forgot Urs. I think they're going to put their
old district heating system under Joel thermal. Please, Cindy. The biggest challenge
for district heating is to build the infrastructure to the buildings. When you pursue
geothermal, okay, you're bringing heat to the surface. If you want to
generate electricity, you're actually losing part of that energy in order to turn that
heat into electricity. If you use that heat for heat, the efficiency is
close to one hundred percent. It's not one hundred percent, but it's very
It's much higher than if you're trying to turn that heat into electricity. Now,
Europe is a perfect place to use geothermal for district heating. You know,
if you've got communities that are further spread out, of course, that
would be more of a challenge because then you have to pipe that heat over
greater distances and you have a higher chance of losing that heat in the piping.
But if you've got a very dense population in a small area, yeah,
district heating is actually a very efficient use of geothermal energy. Can I
ask them? Europe has a lot of district heating systems and I look at
what their solutions are in terms of decomminization. I'm not seeing geo turmal as
part of the solution. So tell me why is that? We believe in
what we're working in. We see a huge potential, We just need to
get the cost down. It's hard for me to say why geothermal isn't more
prevalent in those go forward plans, and especially for district heating. So again,
geothermal is a perfect solution. You use the heat directly for heating and
building heating a greenhouse. It's really a good fit and the cost is going
to be lower than having to turn it into electricity. I'm not sure why
it's not on the radar. Now, you do need to drill a well,
so you would need enough land, say two to three acres, to
set a drilling rig and drill a well. But once that well is drilled,
that drilling rig goes away, and so the footprint still is quite small
if you compare it to other renewable energy sources like wind and solar. Can
I ask you then, I think in terms of megawatts, if you were
to drill, what type of energy are you going to get out of that?
So you've got this square mile that you're drilling in, what type of
energy do you think can you get out of that on a daily basis or
a yearly basis. If we drill to bottom hole temperature of one fifty to
two hundred degrees C. Again, this is the temperature at the bottom of
the well, depending on the ambient temperature, depending on the formation, depending
on the well design. We're thinking about three megawatt net pacity your output per
well. Now, if you want to scale to say fifty megawatts, then
you would drill eighteen to twenty wells those wells would be very closely spaced on
surface, so ten feet apart, which actually enables you to use what we
call a walking rig where you don't have to completely disassemble the rig to move
from well to well, So you could use a walking rigs, so your
operational efficiencies are very high. That fifty megawatt well footprint is about an acre
and a half and then if you add the power plant, you're talking about
another two and a half acres. So for less than five acres we could
scale to, for example, fifty megawatts, and that's electric, that's fifty
megawatts electric. For thermal that would be one hundred and fifty thermal megawatts,
because you're again you're losing efficiencies as you convert the heat to electricity versus using
it for direct heating. For our listeners, who doesn't know what's an acre,
it's basically a football field. It's pretty good. Within five football field
you manage to pack that much energy, that's really excellent, which means it
can be made relatively close to those big city centers. What we've seen over
the years are various scheme of government support, and of course in the US,
now you've got the IRA so this, I mean, it looks like
governments in general are kind of in favor. So do you think you have
sufficient whether it's tax credit or subsidies or whatever to scale up your industry or
you need more? Now that's a great question. I mean, the Inflation
Reduction Act has been very beneficial for the first time put geothermal on par with
wind and solar. Now, you could argue to geothermal be better than par
with wind and solar because wind and solar has a fifteen twenty year headstart on
us. But okay, we're now on par with these tax incentives for wind
and solar. What I have seen in different US government says Department of Energy
funding opportunities, is that there's other renewable energy technologies such as direct air capture
or ccs that tend to get more funding kind of in the billions, versus
geothermal seems to get it in the millions. So our business plan is we
want to be successful regardless of tax incentives from the US government, because that's
it's the way you're going to survive long term. But of course, in
the near term, as we're developing technologies, we're installing first of a kind
demonstration plants. Those incentives are quite helpful because before you get to scale,
those types of incentives help you get over that financial harm. Yeah, I
would say the Inflation Reduction Act has done a lot for geothermal and for energy
storage. We also do energy storage deep in the earth, and for the
first time, it's allowed you to do energy storage and not necessarily have to
pair it with another technology. So you can do it independent of different types
of technologies, or you can pick and choose which technologies you want to pair
it with. Could you dig into that when you say energy storage, what
type of to this is heat storage? Is it? So what we're doing
is we have a long duration energy storage solution that we can actually deliver now
and at a cost that is competitive with pumped hydro storage and with lithium ion
batteries for any duration greater than four hours. If you guys think about pumped
hydro storage, that's when you take water from the bottom of a mountain,
you pump it to the top of the mountain, and you've got that stored
energy of the water at the top of the mountain, and then when demand
peaks, you flow that water down the mounta mountain and you produce energy or
electricity through a pelt and turbine. We're doing that, but we're doing it
down instead of up. We're doing it in the earth. We're drilling a
well. We're using a downward oriented fracturing technology that it's different from the oil
and gas industry, but it creates again an artificial tank in the rock,
and then when the energy demand is low, you use that electricity to power
a electric pump pump water into that fracture. That fracture actually acts like a
balloon, and it balloons and stores that water and it stores it under pressure,
and then you close the valve in at the surface of the well.
And then when that electricity demand peaks, you open that valve and that fractures
wanting to naturally close, and it jettisons that water back to surface under a
huge amount of force, which you can then put through a Elton turbine again
and create electricity. So again it's already cheaper than pump hydrot storage, and
for durations greater than four hours, it'll beat lithium ion batteries. And we
have line of sight to beat natural gas speaker plants. When gas is two
dollars in mcf, we can beat gas speaker plants now at four dollars in
mcf, but we have a line of sight to be able to beat them
at two dollars in mcf. And then let me add one more thing,
our long duration storage. We can pump in and store for seven hours and
then we can produce that stored energy for seventeen So if you imagine pairing that
with solar, you can actually turn solar into base load energy. Wow wow,
wow wow wow. I like what I hear the Cindy. What is
very clear is drilling is drilling part and yourself you've done some of your carry
in the oil and gas industry, So how important it is your technical collaboration
with the oil and gas industry, you know, using them know how in
terms of geological formation out of three D imaging and drilling techniques, extraction techniques
of doing wells putting well together? How is it pair? Please? Traditionally
the oil and gas industry has not been involved in geothermal. There's been very
little inter reaction between the geothermal and the oil and gas industry. But if
you think about it, what we're doing in geothermal is the same thing as
oil and gas. We're drilling a well for a resource. However, in
this case, that resource is heat. So all of the same skill sets
that are needed in oil and gas are needed in geothermal drilling, subsurface characterization,
supply chain, capital efficiency optimization. What the oil and gas industry can
bring is the oil gas industry in the US alone will drill about twenty thousand
wells a year, whereas the geothermal industry globally will drill maybe a couple of
handfuls of wells, And so the oil and gas industry can really bring a
lot of expertise in optimizing that well design and that well cost and bringing that
cost down. So that's one thing we're excited to be able to bring to
geothermal. And from a permitting and regulation point of view, do you kind
of piggyback on the oil or gas regulation in terms of permitting or is it
more complex in other world? Does it make sense to drill in oil states
or none other states? It really depends on each state. But you're spot
on in that in most of the states where you have oil and gas drilling,
the permitting for geothermal actually falls under that same regulatory agency. So in
Texas, for example, oil and gas drilling and geothermal drilling all reside under
the Texas Railroad Commission, which is the regulatory body here in Texas. In
Louisiana, where there's a lot of oil and gas drilling, it's also the
same regulatory body. So it's typically going to be under the same regulatory body
because you really are doing the same thing. You're drilling a well, and
again it's just for a different resource. Now, where permitting gets tough,
at least in the US, is when we get on federal lands. The
permitting on federal lands can take five years, whereas the permitting naturally in a
state that has done oil and gas drilling and they're comfortable with the technologies and
the due diligence, you can get a permit in a matter of a few
weeks or a few months. And Sindy, can I ask you this.
I love new technologies, and what I've been reading a little bit about is
plasma drilling, and I look at that and I go, that could be
a real revolution. I'd love to hear your thoughts and that maybe explain what
it is is first, and then I'd love to hear your thoughts. There's
definitely some space age drilling technologies out there, there's plasma, there's millimeter wave
drilling. You know, there are companies that are working on these space age
technologies and they're trying to drill deeper, hotter, faster. We love what
they're doing. I mean, we know drilling very well. Who's doing plasma
drilling. We know Carlos and his team at Quays very well. They're doing
the millimeter wave drilling. We are watching them with excitement and interest, and
you know, once they've crack that nut, we want to ride on their
coattails and install geothermal deeper and hotter. But quite frankly, there are a
few years out. So what we want to do is be able to use
existing oil and gas equipment and know how to scale geothermal now and then as
these guys are figuring out how to drill deeper and hotter, then move into
that area once that has been and actually solved and commercialized. Talking about new
tech, we read also about the loop that company called evore. Is that
something you understand or you're close to that technology? We understand what John and
his team it ever are doing. So that's called closed loop geothermal or some
people call it ags advanced geothermal systems. So the definition of closed loop geothermal
is that the working fluid that you're using down hole to harvest the heat from
the earth does not come in contact with the rock. It's kept in pipe.
The challenges that we see with this technology is that in order to harvest
heat from the earth, you need huge surface area. So if you think
about if you have a fracture that's a kilometer high and three hundred meters long,
and it's the aperture, the opening is say three milimeters, and just
think about two very huge hot plates, So you've got a huge amount of
surface area for that heat transfer. Whereas if you're trying to rely on a
pipe system and an oil and gas or in geothermal, a large size pipe
is nine and five eight cents or ten inch, let's say ten inch.
If you cut that ten inch pipe down the middle and you kind of open
it up, if you can imagine that surface area, you're going to need
thousands of feet of well bore in order to have the same surface area that
you would have in that fracture that I'm describing. That's two hot plates that
are very large. And so the challenge with closed loop is the economics.
You know it, can it be cost effective to drill these thousands of feet
and then turn that into electricity. What will that be cost competitive with wind
and solar and natural gas? That I think that is the challenge, Cindy.
I understand conventional okay, that's one thing. Understand space age, and
you're kind of in the middle advanced geo thermal. So why do you think
it's the right hoss on which to bet? Conventional geothermal geographically limited? New
geothermal is not geographically limited. However, the challenge is to get the cost
down. We need to get the cost down to be competitive with wind,
solar, natural gas, and coal. And it can be a sexy new
energy source, but it has to be cost competitive, and so that is
what the industry needs to focus on. We need to basically look at technologies
in both the well designed space and in the power plant space to drive costs
down and to improve efficiency so that we can deliver a unit cost of energy
at a lower cost that is competitive with the existing energies out there. Sindy,
can you just get out of crystal ball and tell us how you think
the geotermine industry will look like In twenty thirty, energy demand has doubled for
the past twenty five years. It's expected to double again over the next twenty
five years. Electrification in both industry and household is going up. Geothermal and
energy storage in synergies with wind and solar, is going to be a very
prevalent part of the energy solution in twenty thirty. I would say it's going
to count for more than thirty percent. Wow, that's a big statement.
I like it. I like it, and I like it as well because
I remember I did the prediction that this decade would be the decade of Joe
Thumbalso, Cindy, I thank you very much because you've brought a mode to
my empty gun. I wish you the best for your project, your company,
and we'll put all the details in the show notes. Thank you very
much, Indy. I listened to Geo turmal Is. It's the renewables that
we never talked about. So it's really good to have you on the show
and to talk about geotarma right and the possibilities around it. Yeah, thanks
guys, Thanks thanks for giving us a platform to talk about geothermal and energy
storage. Don't forget energy storage deep in the Earth is going to revolutionize wind,
solar and the way we do energy storage for the utility grade types of
energies. Absolutely, Thank you, Cindy, thank you so much. So
Jab, about two years ago I made the prediction that that would be the
decade of Joe Turman and you laugh at my face? Are you still laughing,
Jahab, Yeah, I am, because I think it's going to take
a little bit longer. I think the next decade it's going to be the
decade of Geotarma. No, there's no doubt, Lron, It's Geotarma is
going to be very important. But I think it really is going to be
the two thousand charities before it really kicks off. But I might be wrong.
I hope I'm wrong actually, because we do need it because at the
end of the day, the energy transition up to now has been about decarbonizing
electricity. We now need to decomboniz We need these So geo term is a
great way to get your hands on these, okay somethings, as you can
get a chance on electricity as well from me. So I hope you're right.
It seems that we have find a way to drill for advance sure ternel
pretty much everywhere the problems are going to be above the ground. The problems
are going to be the regulators. Now, if you're in Texas or Coloma,
you know you can't reel everything you want. But if you are in
your op, maybe the regulator is going to be much more fearful of giving
you some committing And the second is the expertise, the technical expertise. In
the US they have that type of expertise. We probably don't have it in
Europe. So in fact we would need that adventure tunel in your ope.
But between the regulators and the lack of technical expertise, I am really afraid
that we're not going to benefit from those advancements. Well, I'm going to
tell you something which I didn't tell you before, laur On, which is
I'm going to get involved in a geothermal project development business in Germany doing exactly
this. And actually I just want to say why. It's because you've got
outside of Berlin. You had but by the way, Germany actually had some
shale gastrilin taking place, which people don't know about it because you can call
it something else. The shale gass is a nasty word, but actually you
can reuse these wells quite interesting. So I just say to you you never
know, you might be right. No, no, no, I want
to be wrong. You know. I want the European to don't lose their
mind and money on hydrogen and nuclear because earth wind and fire is there for
the taking. Four seven. I'm sorry. I really do like your vision.
I like the way you put earth, wind and fire, and I
would say, well, listen, we're already going to use earth because listen,
just basic geothermal heat pumps work can work on you know, the ground
source heat pumps. That's what they're using. You're using the difference between the
temperature and the air and the temperature and the ground for heat pumps. But
actually what you're also talking about is doing it at a greater distance. And
I think that's going to happen, because how else are you going to decarbonize
industry. It makes so much more sense to me that you can decentralize drill
at particularly industrial locations, and then you get low cost electricity, and each
makes sense. Wrong, So I hope you're right on that respect. I
hope you're also right that the European Union and the rest of the government's actually
don't inhibit this development, and that we need to be very careful that we
jump on the wrong bandwagon. So basically what you're saying is we need to
see Texans in Europeans fits because a lot of those companies are pushed by entrepreneurs.
Yeah, exactly, exactly, risk takers, right, Yeah, you
know like Cindy or you know Team letting out of Energy. These are entrepreneurs.
They are back with a lot of money. That's not really a model
sor so I hope I'm wrong. Maybe just play on that because what's very
interesting is if you've got to Texas today, you've got a thousand drilling companies.
Right, let's just realize a thousand companies that are out there trying to
sort of explore. Well, actually, in Europe we do something similar as
well, which are solar and wind developers. That's what they are as well.
They're also the entrepreneurs, I hope, and I'm talking to the big
solar wind developers that are out there that they go and do this, and
they go and sort of say this and that's going and take a risk at
this. You know, that's what we need. So this is an hopefull
episode. Yeah, of course, course course course, cause we thank Acpool
for suppotting our show. Thank you again. Guys, thank you very much
and really you're so Cindy, very gracious lady. Will we share the best?
Yeah? Yeah absolutely and shall I talk to you in two weeks time?
Look forward to my friend, look forward to it. Thank you for
listening to Redefining Energy. Don't forget to rate the show and subscribe on Apple
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