| Title | Geothermal and Hydrocarbon Exploration: the Double Play Synergy |
|---|---|
| Authors | Jan-Diederik VAN WEES, Leslie KRAMERS, Harmen MIJNLIEFF, Sander DE JONG, Berend SCHEFFERS |
| Year | 2015 |
| Conference | World Geothermal Congress |
| Keywords | direct use, oil and gas, exploration, portfolio |
| Abstract | Various synergies are possible in hydrocarbon exploration and geothermal energy development. In the Netherlands clastic aquifers which have been explored in the past by the hydrocarbon industry are now being developed for geothermal energy, deploying direct heat for greenhouse heating. Currently, over 5 geothermal doublets have been drilled and 10s of doublet systems are planned. Geothermal doublet systems have encountered associated gas and oil, which -because of small hydrocarbon quantities- have up till now been considered a concern, rather than a benefit to a geothermal project. A key question to exploration is whether more benefit to project developers can be achieved if the business case for hydrocarbon prospects and geothermal energy is combined into a so-called double play. This paper presents a quantitative evaluation of the potential benefits of the double play concept, in which the reservoir target for hydrocarbons and geothermal energy coincides in the subsurface. In order to quantitatively identify the added value of a double play we evaluate the monetary effects of a joint business case, arguing that Abortive exploration costs can be in part of the cases be avoided by reusing the well for another application. We consider therefore two scenarios: the lucky and the dry-wet scenario. In the first one the business case has been developed from a geothermal perspective in which case accidently a hydrocarbon reservoir may be found. We assume that the Net Present Value (NPV) for the hydrocarbon reservoir would be typically higher than the geothermal NPV and hence the name lucky as oil or gas production would be strongly favoured over geothermal production once a hydrocarbon reservoir would be proved by drilling. In the dry-wet scenario, the prospect has been developed from an oil/gas perspective and reflects the added value of reusing the well for a geothermal doublet. Through a simple example we demonstrate quantitatively the benefit of the double play in monetary risk and reward of an exploration project. Furthermore, we evaluated the potential effects of synergy for a synthetic portfolio of gas prospects in the Netherlands. It is shown that the potential benefits may be considerable and can lead to approximately 7 BCM additional gas being produced, and in the order of 10 more geothermal doublets being developed. |