Industry Trend Analysis - Closed-Loop Tech Upside To Global Geothermal - DEC 2017


BMI View: Shell ' s investment in to an innovative geothermal power company provides upside to the development of geothermal power in locations which had previously been considered as marginal wells. The announcement also aligns with our view that O&G companies will increasing look to allocate capital towards gaining market share in the renewable energy industry.

It was announced in November that Shell, via its ' GameChanger' programme, has offered financial support to GreenFire Energy, a US-based geothermal company. Specifically, the undisclosed amount of financing will go towards GreenFire's closed-loop geothermal power pilot project, located at an inactive geothermal well in the Cosa Californian geothermal field. The aim of the project is to use innovative technology, known as ECO2G, to generate power at a site that had previously been considered as a marginal well. This process involves inserting a co-axial closed-loop tube into a well and injecting various refrigerants into the well. This enables power production at sites which lack adequate pressure and permeability.

The commercialisation and deployment of this technology presents an upside to the development of geothermal power around the world, as it opens up locations for power production that had previously been viewed as inactive or marginal. Specifically, this pilot project in California could help catalyse growth in the stagnating US geothermal sector. Despite the US having one of the largest and most developed geothermal industries in the world, in terms of installed capacity, there has been limited growth in the sector over the last five years and a lack of momentum driving the industry.

Upside To Global Geothermal Forecasts
Global Geothermal Capacity And Growth
f = BMI forecast. Source: EIA, IRENA, BMI

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