april commissioning of habanero-4, page-7

I wonder if GDY can be accused of re-writing history…..

The initial concept back in the early 90s was that GDY could establish a circulation in “hot dry rocks” that would power a patented Rankin Cycle generator to produce geothermal power and heaps of it…. Then they discovered the granite was actually saturated so it became

The early Habenero doublet blockage issues “inadvertently” led to the idea that MULTIPLE fracture zones were possible. Initially a single fracture zone would do the trick for GDY but then multiple fracture zones would ”enhance the potential” of the project.

Have a look at the following from the 2005 annual report (note words: "further enhancing the potential of the project"):

"Chemical injection in August, 2005 into Habanero #2 to improve the connectivity before the commencement of the short circulation test (the last step of the diagnostic phase) eventually led to essentially blocking off the connection. It indirectly led to the discovery of additional fracture zones higher up in the well, further enhancing the potential of the project. The blocked Bottom Zone fractures presented an opportunity to hydraulically stimulate the Top Zone fractures. This resulted in the development of a second reservoir (September, 2005), demonstrating that geological conditions are favourable for multiple reservoir developments, a key to large scale commercialisation of the Cooper Basin HFR geothermal resource."

At this point multiple fractures became a possibility….
However see the following from GDY's 'proof of concept' announcement (31 March 2009 to ASX) which said:

"Modelling of wells theoretically located at the extremities of the Habanero stimulated zone showed that the wells would be capable of extracting more than 40 megawatts thermal for over 20 years with only a 5°C temperature draw-down for circulation rates higher than 70 kg per second. Circulation rates during closed loop testing between Habanero 1 and 3 reached a maximum of 15.5 kg per second from a single stimulated zone. Production rates of 25 kg per second have been achieved from Habanero 3. Although these flow rates have not approached 70 kg per second at this time, the results are an indication of the heat capacity of the reservoir." and...

"These achievements do not necessarily imply economic viability at this time. Commercial demonstration will, among other things, focus on improving drilling performance and well costs and demonstrate the ability to stimulate and circulate through multiple zones in the granite to enhance well productivity and injectivity to required levels and to increase the recoverable resource base."

Another statement from this report on the proof of concept under the heading "Achievement of Adequate Well Productivity and Injectivity" said:

"Production testing of wells Habanero 2 and Habanero 3 confirmed flow rates of 18 to 27 l/s from the single stimulated layer. If multiple stimulated layers are created the production rate would be several times this amount. Well Habanero 1, even though it showed evidence of significant mud damage, has accepted injection rates of 18.5 l/s, which is modest but acceptable. But more relevant is the good productivity encountered at well Habanero 3, indicating that comparable injectivity should be achievable provided mud damage is avoided. Therefore assuming the development of multiple stimulated layers, adequate well productivity and injectivity have been demonstrated."

So as you can see we have gone from the concept being “one fractured is the plan” to multiple fractures would “enhance the potential”, to multiple fractures being “necessary for economic viability” (viability "assumes" the development of multiple fractures to get from 27 to 70+).

WHERE ARE WE a further 4 years on (and 8 years on from the Habanero wells)???

The flow rates from the recent Habanero 4 well have been MAXIMUM 38 kg/s (= 38 l/s) which GDY have chosen to compare with the early Habanero STABILISED flow rate of 27 kg/l. It is not clear what the H4 rate declined to, but it is safe to say that it is not a lot better than H3.

The upshot is that GDY is waaaaaay short of original modelled flow rates, and has NOT YET ever demonstrated multiple stimulated zones (let alone a long term stable single stimulated zone).

Economic viability would appear to be some way off….. comments?