Yahoo Finance Saskatchewan company greenlights Canada's first large-scale geothermal power plant
Saskatchewan’s Deep Earth Energy Production Corp. said it will begin construction this year on Canada’s first commercial-scale facility for producing electricity from geothermal heat, highlighting how Canada’s expertise in oil and gas can be adapted to produce greener energy.
The Saskatoon-based company uses drilling techniques that are more commonly associated with oil extraction than anything currently found in the world of geothermal energy.
The privately held Deep Earth announced Feb. 6 that procurement and engineering work has already begun on the first phase of a 25-megawatt power facility in southeast Saskatchewan, close to the U.S. border. The project will be supported by a previously announced five-megawatt power purchase agreement with SaskPower — the first geothermal power contract in Canada.
“We’re using a highly skilled team and workforce from the oil and gas sector and redeploying those skills and that knowhow for the first time ever on a renewable energy project,” said chief executive Kirsten Marcia. “We’re not taking the stance as a clean energy company that it’s us against them.”
Construction and drilling on the first five-megawatt phase will begin in the fourth quarter of this year, with first power production expected by the summer of 2024. The next 20-megawatt segment is not yet fully financed, Marcia said, but once complete, the project will be capable of powering 25,000 households.
Geothermal ‘always on 24/7’
The announcement represents a key turning point for Canada’s nascent geothermal power industry, which remains underdeveloped despite the country’s abundant potential. Geothermal projects are typically more expensive to build than wind or solar, but deliver more reliable, around-the-clock energy.
“As a consequence, we can attract better contracts than wind or solar,” Marcia said. “Because if you’re a utility and you’re buying wind, and the wind isn’t blowing, you need something else to power your grid. With geothermal, it is always on 24/7. Once we’re up and running, it’s always producing power.”
Deep Earth’s project will use oilfield horizontal drilling techniques to access geothermal power, with wells drilled to a depth of about 3.5 kilometres and horizontally for an additional three kilometres. Similar well designs are routinely used in oil and gas, but application of these techniques to renewables is new, the company said.
Marcia, who founded the company, trained as a geologist and worked for years in the oil and gas and mining sectors before turning her attention to renewable energy. With Saskatchewan’s geothermal potential largely hidden underground, she said the company has relied on decades of publicly available exploratory drilling data from the oil and gas industry to identify potential hotspots.
`Cracked the code’
Reaching a final investment decision wasn’t easy, however, as the company dealt with numerous engineering challenges in designing a facility that wouldn’t be at risk of consuming all of the power that it was generating, Marcia said.
During testing, the company also had to find a way to mitigate against the corrosive tendencies of the water it drew from underground reservoirs to the surface for electricity generation, requiring Deep Earth to use protective coatings in well designs that increased project costs.
But, after 12 years of effort, Marcia said the company is “100 per cent comfortable” in proceeding with construction.
“We believe we’ve cracked the code for these lower temperature geothermal resources around the world,” Marcia said. “Saskatchewan is not unique … these sedimentary basins are found all over the world with similar geothermal resources. What can get very exciting is if we were able to deploy this technology and our expertise (to) really have a potentially globally transformative impact on the geothermal energy industry.”
Deep Earth has been working to develop the project since it was founded in 2010. The company began drilling test wells in 2018 and has acquired the subsurface leases to support multiple power facilities capable of more than 200 megawatts of power generation. The company is also exploring the possibility of using some of its subsurface lease for carbon dioxide storage underground.
The project is financed through a mix of private investment and government support, including $25.5 million from Natural Resources Canada in 2019.
mpotkins@postmedia.com Twitter: @mpotkins
