The geotechnical information provided in this hole and the seismic survey has allowed Torrens Energy to engage development partner AGL Energy Limited (AGL), by the serving of a Confirmation Well Notice and data package.
As per the terms of the Geothermal Alliance Agreement, AGL has first right to earn a 50% participating interest in the Project by sole funding the completion of “Confirmation Well” Elendil 1 to a target depth of approximately 4,500m.
Treebeard 1A drilling and seismic expenditure is eligible for matched funding by a Federal Government Renewable Energy Development Initiative (REDI) grant, awarded in 2007 for $3m. The grant covers the development of the Company’s innovative temperature field modelling methodology (3D-TFM).
Parachilna Project Summary
The Parachilna Geothermal Play is the company’s advanced project established as code- compliant Inferred Geothermal Resource. At 780,000 petajoules (PJ) the ‘global’ resource is comparatively large (below) demonstrating the potential for the Parachilna Geothermal Play to produce a leading on-grid Australian geothermal field, 150 kilometres north of the Port Augusta power hub in South Australia.
Parachilna Inferred Resource 2008
Two geological units with potential for ‘hot rock’ reservoir development were identified in the resource model, being the Basement and Precambrian intra-sedimentary targets.
A basement hosted EGS reservoir is the primary target and preferred model for geothermal development at Parachilna, for which the Company has estimated an Inferred Geothermal Resource of 150,000PJ.
Heat Flow Drilling 2008
Heat flow values from drilling at Parachilna in 2008 predict temperatures of + 200°C at depths shallower than 4,500m, associated with an extensive ‘hot spot’.
Drilling 2009 – Treeebeard 1A
Results were recorded from a diamond drill hole completed by Boart Longyear Pty Ltd to 1,807m using a LF230 drill rig.
Casing was stepped from 8’ to 4½’ and finally 3½’ at 27m, 472m and 1,685m respectively. A combination of rotary mud and diamond core drilling was undertaken, to enable temperature measurements to be taken at drilling break intervals, and core to be obtained.
Measured Temperature
Preliminary temperature measurements were conducted at drilling breaks using the company’s temperature probe, and are therefore not fully equilibrated. The temperature was recorded at the bottom of the hole after a drilling pause of 24 hours.
Interpretation Of Results
The intermediary drilling aimed to validate at greater depth the Parachilna Geothermal Play ‘hot spot’ identified by exploration drilling in 2008, and clarify important stratigraphic information for the refinement of the 3D-TFM. In addition the hole targeted the change in heat flow recorded in Gandalf 1 (previous table, 116 to 83mW/m2), which coincided with a porous or ‘vuggy’ limestone unit encountered in the lower part of the hole.
Hot Spot Validated – Preliminary Heat Flow Result
Thermal gradient and thermal conductivity were used to derive a preliminary heat flow value for Treebeard 1A. Point temperature measurements were taken at regular intervals between 1,241 and 1,807m down-hole utilising the company’s thermal measurement equipment. Thermal conductivity data were then measured on core extracted from the hole between 1,241 and 1,807m depth, at intervals of about 14m.
The un-equilibrated temperature measurements used to derive the resulting conductive heat flow gives a good fit to the thermal data from Treebeard 1A, with the modelled gradient trend following the observed temperature values over the sampled interval.
On present data it is concluded that the average conductive heat flow over the section of well from 1,241-1,807m is 91mW/m2 – lower than encountered elsewhere at the Play but above the company’s stated target heat flow.
Geological Model & 3D
The hole provided important geological data used to clarify stratigraphy for the refinement of the 3D-TFM. The aforementioned limestone unit was encountered at Treebeard 1A but did not reveal a change in heat flow as evidenced in Gandalf a few kilometres away.
AGL Energy Limited
Geothermal Alliance Agreement (GAA)
Torrens Energy entered into a binding GAA with AGL in 2008. As part of the arrangement AGL acquired a 9.99% cornerstone position in Torrens Energy.
The GAA provides for the joint development and commercialisation of base-load geothermal projects close to the National Electricity Market (NEM).
Under the GAA Torrens Energy, will continue to initiate geothermal projects through exploration activities including the systematic application of its 3D-TFM exploration methodology across its geothermal landholdings in South Australia.
Once Torrens Energy has advanced its projects through to a deep drilling sites, AGL will have the first right to earn a 50% interest in the geothermal resource by sole funding the completion of a ‘Confirmation Well’ to target depth (~4,000–5,000m) at an estimated cost of approximately $15m.
Confirmation Well Notice Served
Torrens Energy advises, with the reporting of a bottom hole heat flow estimate from Treebeard 1A, that the geotechnical information required to serve the Confirmation Well Notice (CWN) and accompanying data package is complete.
Work is summarised as follows:
Inferred Resource identified by shallow heat flow drilling to approximately 500 meters, and a code-compliant geothermal resource is delineated.
Intermediary validation drilling to 1,000-2,000m (Treebeard 1A to 1,807m) and associated heat flow estimation and stratigraphical refinement of geologic model.
Seismic data acquisition and interpretation enhancing the geological model, target reservoir selection, and Confirmation Well projection of 200ºC at 4,500m.
Scheduled Activity
Torrens Energy and AGL have agreed to a collaborative approach to target refinement at the first proposed deep geothermal confirmation well Elendil 1, with the Companies pooling their respective expertise to optimise the interplay between the technical and commercial drivers for geothermal development.
Information sharing leading up to the CWN has regularly occurred since the GAA was signed in mid-2008, and the Companies will continue optimising the key inputs of temperature, depth, reservoir geology, connection distance, land access and cost, in the time leading up to the spudding of Elendil 1.
Torrens Energy has scheduled addition work in the coming months designed to reduce critical uncertainties and technical risk in the deep Confirmation Well, scheduled to commence in 2010.
Planned work includes follow-up heat flow drilling on the existing Parachilna seismic line, an additional seismic line 10 kilometres to the north, and refinement of the 3D-TFM.
Executive Director John Canaris commented said, “With geology now better understood through the completion of Treebeard 1A and the acquisition of seismic, the Companies will work collaboratively toward planning and completion of the deep well, named Elendil 1, to the target reservoir depth.”
An AGL spokesperson said, “AGL is pleased to receive the Confirmation Well Notice for the Parachilna Project and we have commenced our detailed review of the data package provided. The Notice provides AGL with the option to participate in a deep geothermal exploration well aimed at developing a base load renewable energy project located close to the NEM, which when drilled would deliver AGL with a 50% interest in the project.”