4000psi on geothermal frac, page-7

I think the big attraction with geothermal energy is the possibility of cheap baseload electricity generation that is greenhouse gas free. The early slides put out by Geodynamics estimated a marginal cost of production of around 4c/kWh for geothermal, which compares well with coal-fired generation. The actual heat energy reserves in these deep hot rocks is huge, and with the expectation that a price on carbon was on the way, there was the possibility of replacing coal-fired power with geothermal, and hence it could have been really profitable. But while the idea looked straight forward on paper, the geology and engineering was a whole lot more complex than anticipated, and hence costs have gone up considerably.

I think it's good that BPT got involved. They go after these new technologies like coal seam gas, geothermal energy and shale gas, and leverage their skills to maximise the opportunity for the shareholders. With CSG it worked out well, shale gas is looking very promising, but geothermal is in the balance, but if geothermal held its promise it would have been as big as the other two.

With a lot of government support it's not costing BPT too much to stay involved and I think it's worth giving this technology every chance to succeed. BPT would do very well out of it.