Quarterly No. 70

October - December 2007

IGA
NEWS
Newsletter of the International Geothermal Association
IGA ACTIVITIESIGA ACTIVITIES

Message from the President

Message from the PresidentLadislaus “Ladsi” Rybach

EUROPE

Dear IGA member

Switzerland / BDF Geotherm: the Database of
Geothermal Fluids in SwitzerlandThis is the first Message of your new President. First ofall, I would like to thank all those of you who elected
me to the IGA Board of Directors (BoD) and especiallythose who voted for me to become IGA President. I will
do my best to live up to your expectations.

IcelandOur main challenge today, as IGA, is to strive forwider recognition, by politicians, decision makers aswell as by the general public, of the great potential,
the environmental advantages, and economic benefitsof geothermal energy. Another task to be tackled by
all IGA members is to prepare for participation in theWorld Geothermal Congress 2010 (WGC2010) in Bali,
Indonesia. This key event – where hopefully most IGA
members will meet – will take place 25-29 April 2010at the International Conference Center in Nusa Dua.
Bali is already known as a superb tourist destination
but “our” Conference Center has become famous worldwide, thanks to the UN Climate Summit (December2007). IGA is fortunate that our Indonesian colleagues
selected this venue for WGC2010. The preparatory
work of the IGA Steering Committee, along with theIndonesian Organizing Committee, is already in fullswing; many useful details and further information canbe found on the WGC2010 website www.wgc2010.org
where a Questionnaire for prospective participants canbe downloaded.
Let me extend a special welcome to the new and “old”(incumbent) BoD members. The new Board already had
its first meeting in Reykjavik, Iceland on October 11,
2007 with most members present. The Board also haslots of work ahead, especially as regards the obligationsof IGA towards the World Bank GeoFund. This task weinherited from the old Board; we must now see how thedeliverables can be produced to the satisfaction of the

1

3/ REYST – A new energy graduate
school in Iceland

5USA/ Helium Isotopes Point to New
Sources of Geothermal Energy

6

Mexico/ Commissioning of Unit 8 at 		Los Humeros

7

AMERICA

ASIA/PACIFIC RIM
Australia/ The Burgeoning Australian
Geothermal Energy Industry

8

Philippines/ PNOC EDC now a private
corporation

14

UPCOMING EVENTS
Geothermal meetings

15Bank as well as of IGA. Here, especially the Financeand Education Committees will be involved, assisted by
the IGA Treasurer and by the expert IGA-World Bank
fund administrator, our Executive Director. The Table
below shows the composition of all newly formed IGA
Committees, along with their Chairs (in bold); somemore members still need to be added in order to comply
with the Bylaws.
I also look forward to working closely with the
IGA Officers Ruggero Bertani (Vice President), Gestur
Gislason (Secretary), Colin Harvey (Treasurer) and,IGA News, October - December 2007

2
especially, with Executive Director Arni Ragnarsson, who already provided his highly valuable expertise and support
to the previous Board. IGA is grateful that the well-established operation of its Secretariat at Samorka, Reykjavik has
been recently extended until 31 December 2010.
Let me end on a personal note: some of the readers might know that I am also a music conductor, so I know
how to lead. But whenever I am standing and acting in front of an orchestra, I always realize that the players areproducing the sound, not me. So I will need all your input and cooperation. I can only coordinate, look for the righttempo, establish balance etc., in other words lead IGA at the right speed and in the right direction. Together we can,I’m convinced, perform well to further develop geothermal energy for the benefit of mankind, fully complying withthe theme of WGC2010 “Geothermal: the Energy to Change the World”.

Audit

Bylaws

Education

Finance

Ogena
Ginting
Mertoglu
YamadaBoissavy
AnticsGarnishHarveyLawless

Rüter
BahatiBeardsmore
Hirtz
Horne
Kepinska
Montalvo Lopez
MwangiPopovska
Povarov
Steingrimson
Vuataz
YamadaBrophyAnticsBloomquist
Boissavy
HarveyKreuter

Full professor
in Geothermics
Profile: specialization in tectonics orquantitative geology; specific experience indeep geothermal reservoirs.
Research: deep geothermal reservoirs; roleof discontinuities in heat transfer; geothermal
potential; exploration, resources.
Teaching: specialized teaching and field
activities; key role in the new Master inGeothermics at Neuchâtel.

Information

Membership

Nominating

Programme& Planning

Steingrimsson

Horne

Beardsmore

AnticsBeardsmore
GarnishGinting
Gislason
Horne
Hirtz
Iglesias
Kepinska
Lawless
MalolepszyMontalvo Lopez
Mwangi
UchidaVuataz
Yasukawa

BahatiBarragan
BertaniBrophyKreuter
Lopez
Montalvo Lopez
Mwangi
Povarov
Suryadarma
YamadaZheng

HarveyPovarov
Ragnarsson
Rüter
SimsekYasukawa

Boissavy
Hirtz
Kepinska
Ogena
Suryadarma
UchidaIGA News No. 70

The University of Neuchâtel(Switzerland) recruits a

Duties: 6 to 8 hours weekly teachingin English and French, research andadministration.
Requirements: PhD and record ofinternationally recognized research ingeothermics.
Starting date: August 1st 2008.
The University of Neuchâtel is an equal
opportunity employer and encourages
women to apply.
Application file: check on website below.
Application files should be sent before
January 31st, 2008, including electronic
copy to:Prof. François Zwahlen, head of thehiring committee
CHYN - Centre of Hydrogeology
Rue Emile Argand 11, CP 158
CH-2009 Neuchatel, Switzerlande-mail: secretariat.chyn@unine.ch
Information:
http://www1.unine.ch/chyn/php/news.
php?lang=en
Prof. François Zwahlen (francois.zwahlen@unine.ch).

3

EUROPE
Switzerland

BDFGeotherm: the Database of Geothermal Fluids in Switzerland
Romain Sonney & François-D. Vuataz, Centre for Geothermal Research – CREGE, University of Neuchâtel,Switzerland (www.crege.ch), e-mail: romain.sonney@crege.ch
Objectives
The principal motivation to create a database of geothermal fluids was to put at the disposal of the geothermal
community a comprehensive set of data on the deep fluids of Switzerland and of some neighbouring areas, which are
generally widely dispersed and often difficult to reach. Many data exist on geothermal fluids in Switzerland. These
data come from deep boreholes realized for geological evaluations, geothermal prospects, oil exploration wells andspas, as well as thermal springs and fluids outflow from tunnel drainage systems. All these data are contained in many
reports and papers, often not published and not very accessible to potential users of this information.
The objective of this project was to gather the maximum amount of data on deep fluids and to integrate them ina relational database. This database can be useful to all geothermal projects planning to prospect, to produce or to
inject fluids at depth. It may concern any permeable geological formation as well as projects based on the technology
of enhanced geothermal systems (EGS). This tool will also be used to estimate and forecast the chemical compositionof the geothermal fluids. The interest is obvious for studies related to the risks of mineral deposits or corrosion in
boreholes and in surface installations, and also for studies on interactions between rocks and thermal waters. Users will
be able to complete or to introduce new information into the BDFGeotherm database with their own documentationand on-going projects. Search, addition, export and exploitation of data are explained in the user’s manual provided
with BDFGeotherm. This handbook describes all the steps to follow for an optimum use of this database.
In Switzerland, the estimate of geothermal direct use for 2006 reached about 650 MWt installed capacity and 5,500
TJ/yr heat production, mostly installations coupled to geothermal heat pumps (GHP). This corresponds to a fossil fuelsaving of 130,000 toe. Geothermal energy in Switzerland thus reduces the emission of CO2 by about 400,000 tons per
year. So far there is no electricity generation from geothermal resources in Switzerland. Finally, deep aquifers and hot
springs resources are also used in small district heating networks and for the heating of several spas.
Structure of the database
The BDFGeotherm database has been built under Microsoft ACCESS code and consists of 203 thermal springs or
deep boreholes from 82 geothermal sites implemented into nine tables connected with a primary key: the field “Code”.
A selection of parameters has been chosen from the following fields: general and geographical description, geology,hydrogeology, hydraulics, hydrochemistry, isotopes as well as geothermal parameters (Table 1). Geographically, all
Switzerland was covered although the distribution of data is quite heterogeneous. Among the 68 Swiss sites, a large
majority of them are located in the northern part of the Jura range and in the Upper Rhone valley (Fig. 1). Some sites,in Germany (5), France (3) and Italy (6), were selected for the following reasons: located near Swiss hot springs or deep
boreholes, having similar geological features or representing a significant geothermal potential.
Geologically, each formation containing groundwater was considered, from the crystalline basement to Tertiary
sediments. Moreover, all springs with a temperature higher than 15 °C, or slightly below if the production yields areimportant, were included into this database.
Potential geothermal resources
The 203 water catchments recorded into BDFGeotherm have temperatures ranging from 10 °C in the folded Jura
limestones to 112 °C in the deep crystalline basement below the Molasse Basin. Measured temperatures in thermal
springs, boreholes and thermal springs in tunnels are illustrated on the simplified tectonic map of Switzerland andshow that warmer fluids (> 60 °C) are met in deeper boreholes (> 1 km) except for one site in the External Alps wherewater at 68 °C inflows at a depth of 200-400 meters due to a deep subvertical fracture system in gneissic rocks (Fig. 1).
This same process also gives rise to numerous thermal springs within the Alps. Regarding thermal springs in tunnels,
their measured temperatures do not exceed 40°C. However, these tunnels drain significant quantities of water (> 10 l/s),
which enables them to be potential geothermal resources. In the Tertiary sandstones of the Molasse Basin, measured
water temperatures do not exceed 30 °C, but potential deep aquifers still remain unexplored beneath these formations
IGA News, October - December 2007

4
(Muschelkalk, Dogger and Malm limestones) and the level of respective production rates is mostly unknown. In the
Tabular Jura, north of Switzerland, warm groundwaters (> 40 °C) are collected at relatively low depth due to thepresence of high heat flow conditions (> 150 mW/m2).
Low temperature geothermal resources (< 120°C) in Switzerland are potentially important and all the sectors are
more or less concerned. The main recognized resource areas are located in the northern part of Switzerland andthe Rhine and Rhone valleys. Some deep aquifers (fractured or porous reservoirs) are used in small district heating
networks and in spas. Some areas, like the southern part of the folded Jura and the high Alpine reliefs, seem lessfavourable at first sight. The Alpine valleys drain large amounts of water infiltrated from the mountainsides and cancontain warm waters at depth, but the identification of potential deep upflow remains difficult because fluvio-glacial
deposits hide the bedrock in many places.
Reference
Sonney R. and Vuataz F.-D., 2007. BDFGeotherm: the Database of Geothermal Fluids in Switzerland. Proc. European
Geothermal Congress 2007, Unterhaching, Germany, 30 May - 1 June 2007.
Table 1: Structure of BDFGeotherm database

Table name

List of fields

1.

Description

Code, site name, country, canton, coordinates X and Y, altitude, type and nameof groundwater point, year of realisation, depth, primary and secondary useof fluid.

2.

Geology

Code, surface formation, age of surface formation, reservoir formation, age ofreservoir formation, regional and local tectonics, lithological log.

3.

Hydraulics

Code, flow rate, surface and maximum measured temperature, permeability,
production type, static and dynamic water levels.

4.

HydrochemistryCode, name and sampling date, simplified and detailed geochemistry type,temperature, conductivity, pH, Ca, Mg, Na, K, Li, Sr, HCO3, SO4, Cl, F, SiO2,
TDS (Total Dissolved Solids), ionic balance, TDS variability, comments.

5.

IsotopeCode, name and sampling date, 18O, 2H, 3H, 14C, residence time, altitude of
infiltration, comments.

6. Geothermal   parameters

Code, surface and maximum measured temperature, minimum and maximum
reservoir temperature, reservoir depth, geothermal gradient and geothermal
potential.

7.1. Author

Number of author, author.

7.2. Table-links

Code, number of author and reference.

7.3. Bibliography

Number of reference, reference (70 references used).

IGA News No. 70

5Fig. 1. Location and temperature of the thermal water catchments on data implemented into BDFGeotherm

Iceland

REYST – A new energy graduate school in Iceland
Reykjavik Energy Graduate School of Sustainable Systems (REYST) was officially launched December 3rd 2007 at
Reykjavik Energy headquarters in Reykjavik, Iceland. REYST is an interdisciplinary school, founded by Reykjavik
Energy in collaboration with Reykjavik University and the University of Iceland. The objective is to promote
education and research in sustainable energy use, emphasizing practicality, innovation and interdisciplinary thinking.
REYST offers higher education for engineers and scientists in order to create leading experts in management, design
and research in the field of sustainable energy. The international graduate program is based on the three pillars ofengineering, earth science and business. MSc programme will start in August this year and deadline for applicationis March 15th. Further information is available at http://en.reyst.is.

IGA News, October - December 2007

6

AMERICAUSA

Helium Isotopes Point to New Sources of Geothermal Energy
Paul Preuss, Berkeley, Ca.
In a survey of the northern Basin and Range province of the western
United States, geochemists Mack Kennedy of the Department ofEnergy’s Lawrence Berkeley National Laboratory and Matthijs van
Soest of Arizona State University have discovered a new tool for
identifying potential geothermal energy resources.
Currently, most developed geothermal energy comes from regionsof volcanic activity, such as The Geysers in Northern California.
The potential resources identified by Kennedy and van Soest arise
not from volcanism but from the flow of surface fluids throughdeep fractures that penetrate the earth’s lower crust, in regions far
from current or recent volcanic activity. The researchers report their
Berkeley Lab geochemist B. Mack Kennedy
findings in the November 30, 2007 issue of Science.
used this mass spectrometer (foreground) to“A good geothermal energy source has three basic requirements:
determine helium isotope ratios in samples ofa high thermal gradient — which means accessible hot rock —surface fluids from the northern Basin andRange. (Photo Roy Kaltschmidt)
plus a rechargeable reservoir fluid, usually water, and finally, deep
permeable pathways for the fluid to circulate through the hot rock,”says Kennedy, a staff scientist in Berkeley Lab’s Earth Sciences Division. “We believe we have found a way to map
and quantify zones of permeability deep in the lower crust that result not from volcanic activity but from tectonic
activity, the movement of pieces of the Earth’s crust.”
Kennedy and van Soest made their discovery by comparing the ratios of helium isotopes in samples gathered fromwells, surface springs, and vents across the northern Basin and Range. Helium-three, whose nucleus has just one
neutron, is made only in stars, and Earth’s mantle retains a high proportion of primordial helium-three (comparedto the minuscule amount found in air) left over from the formation of the solar system. Earth’s crust, on the other
hand, is rich in radioactive elements like uranium and thorium that decay by emitting alpha particles, which arehelium-four nuclei. Thus a high ratio of helium-three to helium-four in a fluid sample indicates that much of thefluid came from the mantle.
High helium ratios are common in active volcanic regions, where mantle fluids intrude through the ductile boundary of
the lower crust. But when Kennedy and van Soest found high ratios in places far from volcanism, they knew that mantle
fluids must be penetrating the ductile boundary by other means.
The geology of the region was the clue. The Basin and Range is characterized by mountain ranges that mostly run northand south, separated by broad, relatively flat-floored valleys (basins), which are blocks of crust that have sunk and become
filled with sediment eroded from the uplifted mountains. The alternating topography is the result of crustal spreading byeast to west extension, which has occurred over the past approximately 30 million years. The Earth’s crust in the Basinand Range is some of the thinnest in the world, resulting in unusually high thermal gradients.
The faces of mountain blocks in the Basin and Range clearly exhibit the normal faults that result as the blocks arepulled apart by the extension of the crust. Normal faults form high-angle pathways deep down into the brittle upper
crust. But as the fault plane approaches the ductile lower crust, changes in the density and viscosity of the rock refract
the principle stress acting on the fault, deflecting the fault plane, which becomes more horizontal. It is from these deep,
horizontally-trending faults that Kennedy thinks permeable passageways may emanate, penetrating the ductile boundary
into the mantle.
One of the most seismically active areas in the Basin and Range occurs in what is called the central Nevada seismic
belt. The researchers’ detailed studies in this area, notably at the Dixie Valley thermal system next to the Stillwater range,
established that the highest helium ratios were restricted to fluids emerging from the Stillwater range-front fault system.
The northern Basin and Range, which Kennedy and van Soest surveyed on behalf of DOE’s Office of Basic Energy
Sciences and Office of Geothermal Technologies, includes parts of California, Nevada, Oregon, Idaho, and Utah. In theirsurvey the researchers mapped the steady progression from low helium ratios in the east to high ratios in the west. The
IGA News No. 70

7distribution of the increasing ratios corresponds remarkably with an increase in the rate and a change in the directionof crustal extension, which shifts from an east to west trend across the Basin and Range to a northwest trend.
This change in rate and direction reflects the added shear strain induced by thenorthward movement of the Pacific Plate past the North American Plate. Kennedy
and van Soest believe that the added component of shear strain and increasing
extension rate tear open fluid pathways through the ductile lower crust, into
the mantle. The high helium isotope ratios they found, indicating potential new
sources of geothermal energy, were superimposed upon the general backgroundtrend: anomalously high ratios map zones of higher than average permeability.
“We have never seen such a clear correlation of surface geochemical signals
with tectonic activity, nor have we ever been able to quantify deep permeability
from surface measurements of any kind,” says Kennedy. The samples theycollected on the surface gave the researchers a window into the structure of the
Arizona State geochemist
rocks far below, with no need to drill.
Matthijs van Soest samples
With the urgent need to find energy sources that are renewable and don’t
surface water in the northernBasin and Range. The sample isemit greenhouse gases, geothermal energy is ideal — “the best renewable energy
collected without direct exposuresource besides the sun,” Kennedy says. Accessible geothermal energy in theto air and stored in the copper
16
United States, excluding Alaska and Hawaii, has been estimated at 9 x 10 (90tube, foreground left, which will
quadrillion) kilowatt-hours, 3,000 times more than the country’s total annual
be sealed by crimping.
energy consumption. Determining helium ratios from surface measurements is apractical way to locate some of the most promising new resources.
“Flow of Mantle Fluids Through the Ductile Lower Crust: Helium Isotope Trends,” by B. Mack Kennedy and Matthijs
C. van Soest, appears in the 30 November 2007 issue of Science and is available to subscribers at http://dx.doi.
org/10.1126/science.1147537.
Berkeley Lab is a U.S. Department of Energy national laboratory located in Berkeley, California. It conducts unclassified
scientific research and is managed by the University of California. Visit our website at http://www.lbl.gov/.

MexicoCommissioning of Unit 8 at Los Humeros
Luis C.A. Gutiérrez-Negrín, CFE, Mexico
Unit 8 was commissioned at the Los Humeros geothermal field in late July 2007. This is a back pressure power unitof 5 MWe net, made by Mitsubishi. The installation project included the construction of a steam-pipe, separationequipment, injection line, electric substation and 200 meters of transmission line at 115 kV. All the mechanical, civil,
and electric works for the installation were made by the Comisión Federal de Electricidad (CFE). Like the other units
in the field, Unit 8 is operated by the CFE.

View of Unit 8 and its steam-pipe in
Los Humeros

IGA News, October - December 2007

8
The turbine is fed by 64 tons per hour (t/h) of steam at 165°C and 0.7 MPa as the minimum inlet temperatureand pressure. The electric generator has two poles, an exit voltage of 4.16 kV and spins at 3600 revolutions per
minute (rpm). The steam-pipe gathers the fluids of three production wells and delivers to both Unit 2 and Unit 8.
The separation installations consist of a Webre separator and a dryer. The electric substation includes a powertransformer (4.16 to 115 kV).
This is the first geothermal-electric unit to be commissioned in Mexico in the last four years. With it, the installedcapacity in Los Humeros increases by 14% to reach 40 MWe, and the installed capacity in Mexico totals 958 MWe.

ASIA/PACIFIC RIM
Australia

The Burgeoning Australian Geothermal Energy Industry
Graeme Beardsmore, Senior Research Fellow, Monash University, and Technical Director, Hot Dry Rocks Pty Ltd,
Victoria, Australia
Introduction
Australia has historically been considered a very “cold” country, geologically speaking; not a place that immediately
conjures thoughts of geothermal power generation. It is not surprising, therefore, that geothermal energy has nothistorically played a large role in Australia’s energy mix, nor Australia in the global geothermal community. The past
decade, however, has seen first a trickle and then a flood of interest in geothermal. This interest has been fuelled bya growing realization that Australia is blessed with world class “hot dry rock” and low temperature hydrothermal
resources, coupled with a growing imperative to reduce Australia’s carbon footprint. The result has been new Stateand Federal legislation, escalating levels of public and private investment, a spate of new companies dedicated tothe identification and development of geothermal energy, and a growing number of commercial projects aimed at
geothermal power generation.
Geology of Australia
The impression of Australia as a cold continent comes from the continent’s position in the middle of the Australian
Tectonic Plate (Figure 1), and the fact that the continent has large areas of exposed Archaean and Proterozoic crust.
There are no plate margins, active volcanoes or surface geothermal manifestations (with the exception of a handful ofwarm to hot springs) on the Australian continental land mass. In spite of the lack of surface signs, however, there is asignificant body of geological evidence to suggest that the continent may not be as cold as initially thought. Some ofthis evidence is presented below.
Borehole temperatures
An assessment of the thermal resource beneath the Australian continent is hampered by the fact that there are
relatively few published conductive heat flow measurements for the continent. The global heat flow data base lists justover 100 measurements across an area roughly equal in size to the 48 contiguous states of the USA. In comparison,
there are many thousands of points published for the USA. This paucity of data makes it difficult to quantify theactual energy in the ground, but related data provide a broad indication that heat flow, and potential temperature
resource, varies significantly across the continent. Chopra and Holgate (2005) published a GIS analysis of temperatures
reported from over 4,000 boreholes across the continent. They used a simple linear extrapolation method to estimate
the temperature of the crust at a depth of 5 km. The results (Figure 2) suggest that large sections of the continent
are underlain by relatively hot crust. Temperatures in excess of 200°C have, indeed, been intersected by petroleum
exploration wells at depths little more than 3 km in the Cooper Basin in central Australia. In addition, Geodynamics
Limited have reported temperatures approaching 250°C at a depth of about 4,400 m in the geothermal exploration
well Habanero 1 in the same region. Figure 2 suggests that large tracts of the continent may be underlain by crust ofsimilar temperature, although wells to the appropriate depth have not yet been drilled in any of the other areas.
IGA News No. 70

9Figure 1.
Tectonic plate boundaries, showing the Australiancontinent in a central position on the Australian
Plate. Image modified after USGS.

Figure 2.
Approximate temperature distribution at a depth of
5 km in the Australian crust, against broad tectonic
elements (black lines). Data points shown as white +symbols. Red is relatively hot crust, blue is relatively
cold. From Chopra and Holgate (2005).

Tertiary eruption centers
Australia is not generally considered an active volcanic region, but the eastern side of the continent, from the stateof Queensland in the north to Tasmania and South Australia in the south, plays host to a large number of relatively
young basaltic eruption centers. The state of Victoria in the southeast of continental Australia, for example, shows
evidence of intermittent volcanism over the past 190 Ma (million years), with volumetric peaks between 57-42 Ma and
5-0 Ma. (Price et al., 2003). The most recent event, at Mount Gambier just over the border in South Australia, hasbeen dated at less than 5,000 years (Sheard, 1995). These volcanic features appear to be related in some manner to aseries of rifted marginal basins along the same coast. The exact relationship is far from obvious but, with such a longand potentially ongoing history of volcanic activity throughout the region, it is tempting to conclude that there may be
young intracrustal igneous bodies or areas of elevated mantle heating, though no direct evidence of such phenomena
has yet been found. The most tantalising evidence that young volcanic features are associated with geothermal energy
sources lies in the northern part of the state of Queensland, in the northeast of the country. A number of hot springsin the area known as the Atherton Tablelands discharge water at temperatures in excess of 70°C. The same area hosts
some very young volcanic rocks (on the order of 10,000 years), including some spectacular lava tubes.
Great Artesian Basin
The Great Artesian Basin (GAB) is the world’s largest artesian groundwaterbasin, underlying about 22% of the Australian continental landmass.
Groundwater from the GAB comes out at wellhead temperatures ranging
from 30°C to 100° C (Figure 3), and in most cases has to be cooled before
it can be used as town or stock water. The sheer size and temperature of
the underground water resource makes it an attractive geothermal target.
The geothermal potential of the GAB was highlighted in the June 2002
edition of the GeoHeat Center Bulletin (Habermehl and Pestov, 2002).
Current uses of geothermal energy in Australia
Chopra (2005a) described the state of the geothermal industry in Australia
in 2005. Little has changed between then and now in the number ofcommercial operations, but governments and organizations across thecountry are beginning to recognize the potential of geothermal resources
and are exploring new possibilities for utilization. Geothermal utilizationin Australia is currently restricted to a single small binary cycle power
generator and a handful of direct uses. Some examples follow.
Figure 3.
Birdsville Geothermal Power Plant
Groundwater temperature from the Great
Ergon Energy, the state-owned electrical power company in the state
Artesian Basin. From Habermehl andof Queensland, owns and operates the Birdsville Geothermal Power
Pestov (2002).
Plant. Birdsville (25°54´S, 139°22´E, population 100) is a small town insouthwest Queensland, near the border with South Australia. The townlies more than 1,500 km from the nearest state capital city and many hundreds of kilometres from the nearest pointon the national electricity network, so all electrical power is locally generated. A simple binary cycle geothermal

IGA News, October - December 2007

10
generator supplies a net 80 kW of electricity, sufficient to supply Birdsville’s off-peak demand. Diesel generators
cut in at times of higher demand. The heat source for the geothermal plant is the town’s water supply bore, whichflows 98°C water at 27 litres per second. (see also Chopra, 2005b). At the time of writing, Ergon Energy is funding
a study into the feasibility of improving the capacity and efficiency of the geothermal plant. The study is looking at
such things as improving the temperature and flow rate of the resource, potential for reinjection (currently most of
the spent fluid is discharged to a surface stream), and decreasing the parasitic load from the cooling fans (current
parasitic cooling load is on the order of 30% of gross power output).
Portland Space Heating Facility
Portland (38°20´S, 141°36´E, population 8,800) is a town on the west coast of the state of Victoria. It was host toAustralia’s only geothermal district heating system, operated by the Glenelg Shire Council. Bore water at 58°C was
drawn at a rate of 90 litres per second from 1,400 metres in the Dilwyn Formation aquifer of the Otway Basin. The
water was used between 1985 and 2006 to heat council buildings, a hospital, a police station, a motel and a publicswimming pool. The capacity of the facility was 10.4 MWt. Initially, the geothermal water was used as Portland’s
drinking water after passing through the heating system, but this practice was discontinued in 1997 due to water
quality concerns. Ironically, between 1997 and 2006 the spent geothermal water was air-cooled (with energy intensive
fans which contributed a net positive amount of greenhouse gas to the atmosphere) and discharged to surface drainage.
The system has been decommissioned since January 2006 because of the poor condition of the bore, the energy
intensive cooling system, and because it was no longer deemed environmentally sustainable to discharge the spent
geothermal water into surface drainage. There is growing political pressure to recommission the system, but it will
require significant investment to drill a new production bore, and redesign of the system to incorporate reinjection.
Innot Hot Springs
The Innot Hot Springs (17°40’S, 145°14’E) lie in the Atherton Tablelands inland from
Cairns in the state of Queensland. It is one of a handful of natural warm to hot
springs that are utilized around the country for tourism purposes. The Innot Spa
Resort is primarily a trailer and camping park, with an outdoor heated spa pool andthree indoor heated spa pools (Figure 4). The source of the geothermal water is a 50
metre deep bore from which 70°C water is drawn. Natural hot water (also about 70°C)
discharges along a short section of stream bed about 100 metres from the bore, andthis natural warm “beach” has been used by visitors and locals alike for relaxation
since being discovered by European settlers in the late nineteenth century. The source Figure 4.
The spa house at the Hotof the water and the heat is poorly understood, and the subject of a current research Springs Resort, Innot Hot
project by the Geological Survey of Queensland. Other commercial hot spring Springs, Queensland.
operations are located at Maree in New South Wales, Hastings in Tasmania, Rye in
Victoria (Davidson, 2006), and a new, multi-million dollar development is underway at Warrnambool in Victoria.
This is not an exhaustive list, and there are early indications that a geothermal spa industry may develop.
Robarra Pty Ltd
Barramundi (giant perch, or Australian seabass) is a very popular eating fish native to northern Australian fresh
waters. The optimum growth temperature for barramundi is about 28°C, typical of the tropical inland waters of
the north. A thriving barramundi farm operates on the south coast of South Australia, however, where the averagesurface water temperature is around 12°C. Robarra Pty Ltd operates the farm at Robe (37°09´S, 139°45´E), utilizing
warm water flowing at 30°C from several hundred metres down in the Dilwyn Formation of the Otway Basin. The
fresh geothermal water passes through adjustable boom jets directly into the grow out tanks. The operation provides
employment for about 22 local people, and turns over about AU$ 2 million annually.
Sources of electrical power
In spite of the majority of geothermal energy being directly utilized at present, most attention is currently on developing
new sources of electrical power. Australia’s electricity demand is about 50,000 MW (CSIRO 2006). About 7,000 MW
is generated from renewable sources (mostly hydro and bio-waste from sugar processing facilities), but the great bulkof demand is met by fossil fuel sources; dominantly black and brown coal, but with a significant proportion of naturalgas (Figure 5). This great reliance on fossil fuels for electricity generation is the primary reason that Australia rates
IGA News No. 70

11
as one of the most greenhouse gas polluting countries in theworld. At 17.35 tonnes CO2 per capita per year in 2003, it ranked
fourth amongst Organization for Economic Co-operation andDevelopment (OECD) countries (Source: OECD), behind Canada(17.49), the USA (19.68) and Luxembourg (21.96): The stateof Victoria, where about 70% of electricity is generated frombrown coal, is a particularly noteworthy polluter. Australia’s
domestic supply of coal and natural gas is sufficient to provide
electricity at current levels for over 500 years. Under the current
pricing regime, the cost of electricity production from coal, inparticular, is significantly lower than any current alternative.
The current Federal Government, however, aims to introduce
a carbon trading scheme by 2012, and such a scheme will force
the coal-fired power industry to internalize the cost of carbon
emissions. Several economic studies (e.g. McLennan Magasanik
Figure 5.
Associates Pty Ltd, 2006) have concluded that, in a carbon- Sources of Australia’s electricity generation, listed byconstrained economy, geothermal energy could provide the state. Source CSIRO (2006).
lowest cost base-load power. With demand increasing, therefore,
there is scope for geothermal power to provide a significant portion of base load electricity capacity into the future.
Political support
The Australian political system is divided into three levels; local, state and federal. Geothermal energy development
is receiving significant support at all three levels. Local councils increasingly view sustainability and renewability asimportant parameters for development, often giving more weight to these over and above purely financial arguments.
As an example, in 2006 Melbourne City Council opened Council House 2 (“CH2”), a ten storey building in the heart ofMelbourne (a city of three and a half million people) with energy and water efficiency as its core design feature. 22.1%of the construction cost was directly attributed to efficiency features (Melbourne City Council, 2004). While geothermalenergy was not utilized in CH2, the same council incorporated geothermal heat pumps into the air conditioning systemof the East Melbourne Library during a refurbishment in 2005, in spite of the premium cost of the system comparedto natural gas systems. At the state level, the Victorian Government introduced the Victorian Renewable Energy Target(VRET) scheme in late 2006. The VRET scheme requires energy retailers to purchase a minimum of 10% of their
total power purchases from renewable sources by 2016. Since then, several other states have introduced equivalentschemes, with some setting more aggressive targets (e.g. South Australia’s target is 20% renewable power by 2014). For
geothermal energy, some states are matching legislation with financial support. South Australia and Queensland, forexample, offer cost-sharing schemes to offset the cost of drilling. The Australian Federal Government introduced the
Mandatory Renewable Energy Target (MRET) in 2004. MRET requires that 9,500 GWh per year of new renewableelectricity be online by the year 2010. The country is well on track to achieve this goal, largely due to strong growth in
the wind energy sector. Other Federal Government schemes offering financial support to the geothermal energy sector
include the Renewable Energy Development Initiative (REDI), which provides grants for renewable energy innovationand commercialization; Renewable Remote Power Generation Programme (RRPGP), which supports renewable energy
in remote areas; and Renewable Energy Equity Fund (REEF), which provides venture capital for small renewableenergy companies. At the time of writing, six geothermal energy companies have received in excess of AU$ 21 million
total in REDI grants alone. Australia had a change of Federal Government in late November; as well as ratifying the
Kyoto Protocol, the new Government has also ear-marked AU$ 50 million for direct geothermal drilling subsidies.
While the details have yet to be formalised, the industry’s current understanding is that up to AU$ 5 million will beavailable per well on a dollar-for-dollar basis. The Federal Government’s geoscience institution, Geoscience Australia,
operates out of a building in Canberra that utilizes geothermal heating and cooling.
Commercial geothermal industry
At the time of writing there are six companies listed on the Australian Stock Exchange (ASX) with geothermal energy
development as one of their core activities. A seventh company is currently in the middle of an IPO, and several
others are preparing to follow suit. The money is being raised through the public markets primarily to fund desktop
analyses, surface exploration and shallow drilling programs designed to shed light on the nature of the geothermal
IGA News, October - December 2007

12
resource in different parts of the country. About 25 individual companies hold exploration rights or have madeapplication for over 170 exploration licences across five states (Queensland, New South Wales, Victoria, Tasmania
and South Australia.) The size of the exploration licences range from about 100 km2 to over 12,000 km2. At the timeof writing, the remaining two states of Australia (Western Australia and Northern Territory) are in the process ofdeveloping legislation to allow geothermal energy exploration and development. Many geothermal companies havesprung from parent companies engaged in mineral or petroleum exploration, and almost without exception the focus
is on electrical power generation. The distribution of activity, in terms of numbers of exploration licences applied forand granted, is strongly influenced by state boundaries, with by far the most activity in South Australia (99 licences
granted, 39 current applications, and 10 retention licences). This is due in equal parts to attractive geology and anaccommodating State Government. The Department of Primary Industries and Resources, South Australian (PIRSA),
has actively encouraged the growth of a geothermal industry centered on South Australia; with generous drilling
subsidies, a simple application procedure for licences, easily and freely accessible data packages, and by assuming
a leadership role in coordinating the growth of the industry. The range of exploration and development strategies
is almost as wide as the list of companies in the industry is long, but a small number of case studies will serve toillustrate the different strategies being pursued. Listed companies Geodynamics Limited, Petratherm Limited, GreenRock Energy Limited and Torrens Energy Limited each have very different development strategies. The following
summaries also highlight the international expansion of a number of Australian companies.
Geodynamics Limited
Geodynamics (GDY) is the leading geothermal energy development
company in Australia by any objective measure. The company was thefirst to list on the ASX, is most advanced in its development, has thehighest market capitalization on the ASX (AU$ 286.5 million), and receives(arguably) the most media attention. The company holds two exploration
licences and 10 retention licences (allowing them to maintain development
rights for up to 15 years) in South Australia, but GDY’s only project is near
Innaminka in northeast South Australia. It is an engineered geothermal
system project to extract power from 250°C granite at a depth of about
4,500 m. The company has successfully drilled a well (Habanero 1) into
the granite to target depth, performed hydraulic stimulation to enhance thenatural fracture network, and drilled a second well (Habanero 2) to intersect
the fracture network. Unfortunate engineering difficulties resulted in theeffective loss of Habanero 2 and set the project back almost two years.
At the time of writing, however, drilling has commenced on Habanero 3
and the company is confident about achieving hydraulic connection with
Habanero 1 within a few months. Their business plan calls for 40 MW ofelectrical power generation by 2010, with rapid expansion to at least 500 Figure 6.
Drilling of Habanero 1 in the Cooper Basin
MW. The major perceived barrier to commercial success for GDY lies in (Geodynamics, Ltd.)the geographic location of their project. Innaminka is at least 400 km fromthe nearest point on the national electricity grid, and substantial capitalwill be required to transmit generated electricity to the market. This dictates that GDY’s development will ultimately
need to be several hundred megawatts capacity if they are to operate profitably, but the size of their resource will
comfortably accommodate such output if the technology can be proven. GDY also has a subsidiary company (Exorka
International Limited, now based in Germany) dedicated to the commercialization of the Kalina Cycle technology thatwill be utilized in the Habanero project.
Petratherm Limited
Petratherm Limited (PTR) holds nine exploration licences in South Australia, has a subsidiary company exploring
development opportunities in Spain, and has been endorsed by both the Australian and Chinese governments toinvestigate the development of hot rock technology in China. PTR was the second geothermal company to list on
the ASX and has a market capitalization of AU$ 46 million. Their main project lies at a locality called Paralana inSouth Australia. Their single test hole to this stage (Paralana 1) is about 1,800 m deep, and they have demonstrated
levels of heat flow more than sufficient to generate attractive geothermal temperatures at depths less than 4 km. PTR
IGA News No. 70

13aims to deepen Paralana 1 and use it to stimulate the development of an underground heat exchanger within thesediment column. Paralana, like Innaminka, lies off the national electricity grid, but close to a major energy user inthe Beverley uranium mine. PTR have signed a power purchase agreement with the operators of the Beverley mine,
which values electricity generated at Paralana at a higher price than the normal national electricity price. This willallow PTR to receive a premium rate for generated electricity during their early commercialization stage, which will
help them fund growth to the point where they can connect to the grid and compete on the national market.
Green Rock Energy Limited
Green Rock Energy Limited (GRK: market capitalization AU$20 million) holds a range of geothermal exploration
tenements in South Australia; around the world’s largest Uranium mine at Olympic Dam, around the top of
the Spencer Gulf, and in the Cooper Basin. An early entrant into the geothermal industry in Australia, GRK isgeographically positioned to take advantage of the enormous power requirements of a proposed four-fold expansionof the Olympic Dam mine. The company has drilled a 1,900 m deep hole into a granite body in their Olympic Dam
area and demonstrated an attractive heat resource and stress regime for the development of an engineered geothermal
system within the granite. As well as its Australian interests, GRK also holds 32% equity in a combined heat and power
development in Hungary. There, they are seeking high flow rate fluids at about 140°C. The company’s initial drilling
operation in Hungary achieved disappointing results from the point of view of observed fluid flow rates, but the project
was the inaugural recipient of World Bank geological risk insurance for geothermal development in Eastern Europe. As
such, GRK should receive much of their invested capital back, to reinvest in further exploration in Hungary.
Torrens Energy Limited
Torrens Energy Limited (TEY: market capitalization AU$ 18 million) has the stated objective to find the hottest
rocks possible close to population centers and on the national electricity grid. TEY achieved first mover advantage inrecognizing the geothermal potential of a geological feature known as the Adelaide Geosyncline, part of which lies
under the city of Adelaide, capital of South Australia. TEY were recently awarded a AU$ 3 million REDI grant toundertake a drilling program and develop computer software to accurately model the temperature resource beneath
their tenements. TEY also holds an exploration licence under the northeastern suburbs of Melbourne, Australia’s
second largest city. They also intend to investigate the possibility of using geothermal energy to desalinate seawater.
The Australian Geothermal Energy GroupThe geothermal industry in Australia is in the process of forming one or more collaborative organizations. At thetime of writing, over forty companies, organizations and institutions are involved in a loose collaboration called
the Australian Geothermal Energy Group (AGEG). AGEG has coalesced from a broad range of interested parties
under the umbrella of Australia’s involvement in the International Energy Agency Geothermal Implementing
Agreement (IEAGIA). The group is chaired by PIRSA and includes commercial entities, state and federal governmentorganizations, universities and research institutions. To date, the geothermal sector has been unofficially represented
in Canberra by the Renewable Energy Generators Association (REGA), but this situation is now consideredunsustainable with geothermal’s increasingly high profile and number of commercial participants. At the time ofwriting, the commercial partners within AGEG are exploring the possibility of incorporating an industry association
with a full time secretariat and political lobbying as part of its role.
Australian company Geodynamics Limited leads the Enhanced Geothermal Systems Annex of the IEAGIA, at least three Australian companies have interests overseas, and the first Australian (the author) has justbeen elected to the Board of Directors of the International Geothermal Association. As a country, Australia
looks set to play an increasingly important role in geothermal energy development on the global stage.
Note: AU$1 = 0.881 US$ = 0.598 Euro (December 2007)
References

Chopra, P.N. 2005a. Status of the Geothermal Industry in Australia, 200-2005. Proceedings World Geothermal Congress 2005.
Antalya, Turkey, 24–29 April 2005. 8p.
Chopra, P.N. 2005b. Hot Artesian Water Powers an Outback Town in Australia, Geo-Heat Center Quarterly Bulletin, Vol. 26,
No. 2 (June), Klamath Falls, OR. pp. 25-26.
Chopra, P.N. and F. Holgate, 2005. A GIS analysis of temperature in the Australian crust. Proceedings World Geothermal
Congress 2005. Antalya, Turkey, 24–29 April 2005. 7p.

IGA News, October - December 2007

14
Davidson, C., 2006. Peninsula Hot Springs – A Developer’s Story, Geo-Heat Center Quarterly Bulletin, Vol. 27, No. 3 (September),
Klamath Falls, OR. pp. 15-18.
CSIRO, 2006. Energy Futures Forum Report.
Habermehl, R. and I. Pestov, 2002. Geothermal resources of the Great Artesian Basin, Australia. Geo-Heat Center Quarterly
Bulletin, Vol. 23, No. 2 (June) Klamath Falls, OR. pp. 20-26.
Melbourne City Council, 2004. CH2 in facts and figures. PDF fact sheet, 2p.
McLennan Magasanik Associates Pty Ltd., 2006. Renewable energy—a contribution to Australia’s environmental and conomic
sustainability. 131p.
Price, R.C., Nichols, I.A. and C.M. Gray, 2003. Cainozoic igneous activity. In: Birch, W.D. ed. Geology of Victoria, pp.361-375.
Geological Society of Australia Special Publication 23. Geological Society of Australia (Victoria Division).
Sheard, M.J., 1995. Quaternary volcanic activity and volcanic hazards. In: Drexel, J.F. and W.V. Preiss, eds. The Geology of South
Australia, Vol. 2, The Phanerozoic. South Australian Geological Survey Bulletin, 54, pp. 264-268.

Philippines

PNOC EDC now a private corporation
By PNOC EDC Corporate Communications
The PNOC EDC Energy Development Corporation has been fully privatized with the successful sale to Red Vulcan
Holdings Corporation of the remaining 60% controlling interest. A consortium of First Gen Corp., Spalmare Holdings
B.V. and Prime Terracota Holdings Corp., Red Vulcan Holdings Corp. bid PhP58.5 billion (USD 1.4 billion) for thecontrolling stake, equivalent to PhP9.75 per share.
Offering the second highest bid was FDC Geo-Energy Holdings, Inc. (Filinvest Development Corporation and Int’l
Power Masinloc Holdings, Inc.) who bid PhP48.525 billion (USD 1.17 billion). Third and fourth placers were Panasia
Energy Holdings, Inc. (San Miguel Energy Corp. and Beleggingsmaatchappij Broem B.V.) and AP Renewables (Aboitiz
Power Corp.) who bid PhP39 billion (USD 0.94 billion) and PhP33.165 billion (USD 0.8 billion) respectively. Red
Vulcan now gains the majority control of the operational and financial management of the company.
PNOC EDC’s success story was best demonstrated when it tapped the domestic and foreign equity markets
with the listing of its shares in the Philippine Stock Exchange (PSE) on December 13, 2006. The sale of 6 billion
shares generated a total of PhP19.2 billion or USD 461.5 million. Over 160 institutional investors subscribed to theinternational part of the offer. At the end of its first trading day, PNOC EDC shares closed 42% higher at PhP4.55.
The IPO is the most successful for the Philippine Government in 12 years, providing a template for other state firms
intending to go public.
By July 2007, it had become a majority privately owned company with almost 53% of its outstanding shares being
owned by about 170 institutional funds. The follow-on offering of additional 3 billion shares in July generated PhP
17 billion or USD 409 million to Government coffers.
“We are confident that the Company can maximize its growth potential once the benefits of full privatization set
in. This is a step in the right direction - towards attaining PNOC EDC’s vision to become an international geothermalenergy company,” according to PNOC EDC President and CEO Paul A. Aquino.
At 1,199 MWe, PNOC EDC presently controls 60% of the Philippines’ total installed geothermal generating
capacity. Even though this accounts for only about 7.3% of the country’s total installed power generating capacity, it
was able to contribute close to 12% of the total electricity production for 2006.
With 31 years of hands-on experience and industry leadership, the Company is capable of providing integrated
services from geothermal exploration and development to power plant operation.
PNOC EDC is developing about 310 MWe of new capacity in the medium-term, to capitalize on demand growthand supply shortages. The Company’s organic growth is expected to come from accelerated development of new
geothermal projects. Included here is the development of the Nasulo and Mindanao III projects.
Banking on its technical expertise, PNOC EDC also aims to increase revenues from the sale of its services to theinternational market.
IGA News No. 70

15

UPCOMING EVENTS
33rd Stanford Workshop on Geothermal Reservoir
Engineering, Stanford, CA, USA, January 28-30,
2008. http://pangea.stanford.edu/ERE/research/geoth/conference/workshop.html
ENGINE Final Conference, Vilius, Lithuania, February
13-14, 2008. http://conferences-engine.brgm.fr/
29th PNOC-EDC Geothermal Conference, 6–7 March
2008, Makati City, Philippines. Website: http://www.
energy.com.ph/?p=7&type=2&sec=1&aid=12
Prepare the Australian Geothermal Industry
Development Framework. March 14, 2007, TBC,
Australia. Website: www.geothermalframework.net.au
SEMP-AAPG Meeting, Poster Session on Geothermal
Resources. 20–23 April 2008, San Antonio, TX, USA.
Website: http://www.aapg.org/sanantonio/sanantonio1.
pdf
IAHR International Groundwater Symposium, June
18-20, 2008, Istanbul, Turkey. Website: http://www.iahrgw2008.net
XVII International Conference on Computational
Methods in Water Resources, Special session on Massand Heat Transport in Geothermal Systems, San
Francisco, California, 6-10 July 2008. Website: http://esd.
lbl.gov/CMWR08/special sessions/index.html
ENERGEX 2008, 6–10 July 2008, Vienna, Austria.
Website: http://www.energex2008.com
33rd International Geological Congress, Oslo,
Norway, August 6-14, 2008. www.33igc.org
GRC 2008 Annual Meeting/2008 Geothermal Energy
Trade Show, 5–8 October 2008, Reno, NV, USA. Website:
http://www.geothermal.org
World Energy Engineering Congress (WEEC), 8–10
October 2008, Washington, DC, USA. Website: http://
www.energycongress.com/
8th Asian Geothermal Symposium, Hanoi City,
Vietnam, December 9-12, 2008, contact: http://unit.aist.
go.jp/georesenv/asia8.html

IGA News
IGA News is published quarterly by the International
Geothermal Association. The function of IGA Newsis to disseminate timely information about geothermal activities throughout the world. To this end, agroup of correspondents has agreed to supply news foreach issue. The core of this group consists of the IGA
Information Committee:
Benedict Steingrímsson, Iceland (Chairman)
Graeme Beardsmore, Australia
John Garnish, United Kingdom
Alimin Ginting, Indonesia
Gestur Gíslason, Iceland
Roland Horne, USA
Paul Hirtz, USA
Eduardo Iglesias, Mexico
Beata Kepinska, Poland
Jim Lawless, New ZealandZbigniew Malolepszy, Poland
Francisco E. Montalvo Lopez, El Salvador
Martin N. Mwangi, Kenya
Toshihiro Uchida, Japan
François-David Vuataz, Switzerland
Kasumi Yasukawa, JapanThe members of this group submit geothermal news
from their parts of the world, or relevant to their areasof specialization. If you have some news, a report, or
an article for IGA News, you can send it to any of theabove individuals, or directly to the IGA Secretariat,
whatever is most convenient. Please help us to become
essential reading for anyone seeking the latest information on geothermal worldwide.
While the editorial team make every effort to ensure
accuracy, the opinions expressed in contributed articles remain those of the authors and are not necessarily those of the IGA.
Send IGA News contributions to:
IGA Secretariat, c/o Samorka
Sudurlandsbraut 48, 108 Reykjavík, Iceland
fax: +354-588-4431
e-mail: iga@samorka.is
Contributions to the next issue of IGA News must be
received by 9 February 2008.

This issue of IGA News was edited by Eduardo Iglesias.
John Garnish proofread the articles. Produced by Gestur
Gíslason for the IGA Secretariat. Layout and printing byGutenberg, www.gutenberg.is
IGA News, October - December 2007

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