Big Oil majors have been scrambling to make the most ambitious climate commitments in the industry, planning a pivot to clean energy, talking about net-zero emission bills, solar, and wind. However, there is another clean energy source that has remained out of the spotlight–one that may eventually rise to prominence: geothermal.

Geothermal energy is, simply put, the heat from the Earth’s mantle brought to the surface to use for heating and, more importantly, electricity generation. Iceland is the usual example of successfully harnessing geothermal energy. Iceland, however, is not the only place where geothermal can be tapped. In fact, it’s everywhere. You just need to know exactly where and how to drill for it.

Yes, the keyword here is drilling and extraction: the same thing oil and gas companies do. It should come as no wonder then, that a number of oil and gas industry veterans have decided to go down the clean energy road with geothermal projects. And according to them, geothermal is the future of the energy industry, along with solar and wind.

How does this geothermal energy extraction work? The Earth’s core and the mantle are superhot, which is why the deeper you drill for oil and gas, the hotter the rock. Drill deep enough, and you would reach formations where the temperature is 200 degrees Celsius (392 F) and above. This is where geothermal’s potential begins. The planet produces heat constantly, which means it is a much more reliable source of energy than solar and wind with their intermittency problems. And this heat is clean, unlike oil and gas.  It sounds almost too good to be true.

There are two principal ways of extracting heat from the ground. One is via enhanced geothermal systems (EGS), and the other is closed-loop extraction or advanced geothermal systems (AGS).

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EGS is in a way similar to gravity-assisted oil extraction in the oil sands, involving drilling first vertically and then horizontally, and fracking the formation to release the heat, which heats the water injected into the well and then brings it to the surface. 

AES, or closed-loop systems, are essentially radiators drilled into the ground, as the executive director of the Geothermal Entrepreneurship Organization at UT at Austin, Jamie Beard, explains here. You drill deep enough to tap some high heat, flush a special fluid inside, it heats up, travels up, and powers the turbines of a power plant. This is the biggest promise of geothermal: clean electricity generation.

Clearly, extracting heat is quite similar to extracting oil and gas, which is why industry experts are the most likely proponents of this alternative energy. Two of them, vets from Weatherford and Shell, have even designed a hybrid geothermal extraction system that combines fracking and closed-loop drilling to extract geothermal energy. In that system, Lance Cook and Lev Ring, co-founders of startup Sage Geosystems, do away with the need to drill superdeep vertical wells. Thanks to fracking, you could drill a shallower well and then frack “roots” downwards to capture the heat.

So far, so good. But what are the advantages over oil and gas? Besides the fact it is clean energy, geothermal has potentially lower costs over the long term, not just because the drilling equipment has already been invented, but also because it is not cyclical, unlike oil and gas. Operating expenses in oil and gas are high precisely because of the cyclical nature of the industry. In geothermal, this is absent. 

Another advantage: quick development. Cook told Oilprice.com that Sage could go from proof of concept to fully operational hybrid system powering a 10-MW plant inside three years. And it can compete with solar and wind on upfront costs right out of the gate, Cook said.

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Of course, there are also challenges. First of all, costs are an issue over the short term, the executive director of the Research Triangle Consortium and former Halliburton executive Vikram Rao told Oilprice.com. Even though the equipment and drilling expertise is there, in the oil industry, capital costs are high and need to go down.
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Then there is the question of where it is best to drill. While there is heat everywhere in the world, the planet’s crust is uneven. To pick the sweet spots, similar to shale oil and gas, the Earth’s subsurface needs to be mapped, said Rao, adding that this is not too challenging a task. Mapping is, in fact, relatively easy. It just needs to be done before geothermal really takes off.

Then there is shallow versus deep drilling. As in oil and gas, at greater depths, drilling becomes a lot more expensive. This is why shallow geothermal systems, at temperatures of up to about 200 degrees Celsius, are the only potentially economical ones at the moment, according to hydraulic fracturing expert Mukul Sharma from the Petroleum and Geosystems Engineering Department at UT Austin.

For deep drilling, the equipment needs to be adjusted to handle the greater temperatures, which damage the drillbit and any electronics—think sensors—on it. There is also the issue of resource depletion, even though this depletion would be temporary as the heat is produced constantly in the core of the planet. Yet the promise of the technology is so great that, according to the pioneers in the field, that more and more oil and gas industry executives are starting to pay close attention to geothermal.

And why wouldn’t they? Geothermal may be the key to truly distributed power, making centralized grids redundant, and thus significantly reducing the risk of blackouts and other problems. And we could have the first operating system in between three and five years after a successful proof of concept. After that, Sharma says, wider adoption will be quick. 

“Imagine when the next Bugsy Siegel decides to build the next Las Vegas in the middle of a desert,” Sage’s Lance Cook told Oilprice.com. “All that will be needed is a call to Sage and we’ll install a 10MW geothermal plant in months. While we are there, we’ll drill the water wells for them as well.”

By Irina Slav for Oilprice.com

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