U.S. Geothermal Inc. (TSX: GTH) (NYSE MKT: HTM) announced Sept. 21 that it has received the reservoir engineering report for the WGP Geysers project in California from third party engineering firm GeothermEx Inc.
As previously announced, the company successfully completed a flow test program in June on the three largest production wells at the WGP Geysers project in northern California, confirming that the wells were still open and ready for production. GeothermEx (a Schlumberger company) designed the isochronal (step-rate) flow test program, and monitored the testing of the wells.
GeothermEx reports that the four production wells are capable of delivering an initial capacity of 28.1 MW (gross) or 25.4 MW (net) based on current power plant steam conversion rates from a detailed design for a 28.8 MW (net) power plant. These longer term tests show the wells would initially produce a combined total of 458,000 pounds per hour of steam compared to 462,000 pounds per hour of steam from short term tests performed when the wells were first drilled, demonstrating that the capacity of the wells is virtually unchanged.
Using the average steam production rate from these wells and an assumed interference factor of 30%, GeothermEx estimates that an additional two to three production wells would be needed to support the long-term operation of a 28.8-MW (net) plant.
Two methods were used by GeothermEx to estimate the long term capacity of the WGP project, and both support a high probability that a 28.8 MW (net) plant can be operated for 25 years, given the modern plant design and the available productive area.
- The first is the p/z method, an established natural gas reservoir engineering calculation that is routinely used at The Geysers. Based on the plant design and the increase in available injection that would result from WGP’s planned hybrid cooling system, GeothermEx estimates that the reservoir could support the 28.8 MW (net) plant for up to 54 years.
- The second method, which is an empirical approach based on GeothermEx’s extensive experience at The Geysers, is used to estimate the steam production capacity per acre within the productive area of a geothermal leasehold. On this basis, GeothermEx reports that the productive acreage within the WGP leasehold has steam reserves sufficient to supply up to 44 MW (net) with a conventional injection level of 25%, and potentially more at the higher injection levels associated with the planned hybrid cooling system.
“The results of this analysis from our test program clearly shows that the WGP Geysers project has approximately 30 megawatts of steam, drilled, tested and ready for production, and that, with the higher injection rates provided by hybrid cooling, it has the reservoir to support long term generation,” said Dennis Gilles, CEO of US Geothermal. “We are pleased with last week’s passage of SB-350 in California, which now raises the Renewable Portfolio Standard for the state to 50% renewable energy by 2030, the highest in the country, and we anticipate this will increase the interest in a power purchase agreement for our WGP Geysers project.”
U.S. Geothermal says it is a leading and profitable renewable energy company focused on the development, production and sale of electricity from geothermal energy. The company is currently operating geothermal power projects at: Neal Hot Springs, Oregon; San Emidio, Nevada; and Raft River, Idaho. Those facilities have a total power generation of approximately 45 MW.
The company is also developing projects at: The Geysers, California; a second phase project at San Emidio, Nevada; the El Ceibillo project located near Guatemala City, Guatemala; and at Crescent Valley, Nevada. U.S. Geothermal’s growth strategy is to reach 200 MW of generation by 2020 through a combination of internal development and strategic acquisitions.