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Hot dry rock geothermal exploration in Australia, application of the in situ

stress field to hot dry rock geothermal energy in the Cooper Basin

Article · January 2004

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 Hot dry rock geothermal exploration in Australia

R.R. Hillis1, M. Hand2, S. Mildren1*, J. Morton3, P. Reid4 and S. Reynolds1

Abstract
Hot dry rock (HDR) geothermal energy is obtained by circulating water between injection and production wells
through hot subsurface rocks. The recovered hot water should be around 250ºC for efficient electricity generation. South
Australia has become a focus for HDR developments due to its exceptionally hot subsurface rocks. Geothermal
Exploration Licences have been issued in South Australia following modifications to petroleum legislation. New South
Wales has issued geothermal licences after modifications to mining legislation. Renewable Energy Certificates, mandated
by the Commonwealth Government, increase the competitiveness of electricity generated from renewable sources such
as geothermal energy.
Previous HDR projects have focussed on areas of known high geothermal gradient, based, for example, on experience
from petroleum wells such as the European Soultz-sous-Forêts site and Geodynamics’ Habanero-1 well in the Cooper
Basin. An alternative strategy is to explore for the highest geothermal gradients closest to electricity markets.
MNGI/Petratherm holds Geothermal Exploration Licences within the exceptionally hot South Australian Heat Flow
Anomaly and will target buried thermally anomalous granites and radiogenic iron oxides therein. Simple thermal
calculations indicate that under suitable circumstances temperatures of 250ºC may be attained at depths <4 km within the
licences. The thermal conductivity of the cover rocks is as important a factor as the heat-generating potential of the
basement. There exists a continuum of geothermal energy sources from hot, shallow, high-permeability aquifers to
deeper, tighter aquifers, to hot fractured basement, to basement hot dry rocks. Indeed end-member HDR-type targets may
be relatively rare and commercial HDR exploration may also target conventional geothermal resources.

Keywords: hot dry rock; geothermal energy; geothermal exploration; South Australian Heat Flow Anomaly

Introduction
Australia is a minor player in world geothermal energy
production with a nominal 150 kW plant at Birdsville, Queensland,
powered by approximately 98ºC water from the town’s water bore.
This well has flowed for 45 years and produces water at about 30
litres per second from the aquifers of the Great Artesian Basin at
1,173–1,220 m depth (Burns et al. 2000). New Zealand, in contrast
Eromanga/Great
to Australia, has an installed capacity of some 437 MWe of Artesian Basin
geothermally-fuelled electricity. The Philippines and the United
States each have installed capacities of approximately 2 GWe, Cooper Basin
together equalling half the world’s capacity of 8 GWe of
geothermally-fuelled electricity (Huttrer 2001).
Conventional geothermal (hydrothermal) energy is generally SAHFA
produced from hot water from relatively shallow, hot aquifers in
volcanic regions. Cooled geothermal brines may be re-injected
back into the source aquifer both to dispose of the cooled brines
and to maintain reservoir pressure. Given that geothermal
electricity must be produced on site, there is a requirement for
shallow, hot, permeable aquifers in the vicinity of markets for
electricity. Australia’s potential for such conventional geothermal
energy production is generally perceived to be low.
Recently, however, Australia has had a high profile in Figure 1. Location of Cooper Basin, Great Artesian Basin (known to
geothermal energy. Geodynamics Ltd drilled a 4,420 m deep well geologists as Eromanga Basin) and South Australian Heat Flow Anomaly.
into the basement of the Cooper Basin during 2003 in the first As indicated by Neumann et al. (2000), and Figure 5, the extent of the
SAHFA is not precisely constrained, but it is centred on the western margin
of the Adelaide Fold Belt. It may extend in a northerly direction, passing
1 Australian School of Petroleum, University of Adelaide, SA, 5005
into the basement of the thermally anomalous Cooper Basin system.
2 Geology and Geophysics, University of Adelaide, SA, 5005
3 Department of Primary Industries and Resources SA, GPO Box 1671,
Adelaide, SA 5000.
4 Minotaur Resources/Petratherm Ltd, 247 Greenhill Road, Dulwich,
SA 5065.
* Now at JRS Petroleum Research Pty Ltd, PO Box 319, Kent Town,
SA, 5071

PESA Eastern Australasian Basins Symposium II Adelaide, 19–22 September, 2004 413
 R.R. HILLIS, ET AL.

stage of an attempt to engineer a hot dry rock (HDR) geothermal

reservoir. The Cooper Basin underlies the Great Artesian (or
Hot dry rock geothermal
Eromanga) Basin (Fig. 1). Another paper in this volume describes energy: the process
the Geodynamics project (Wyborn et al. this volume). We recognise three distinct stages to HDR geothermal electricity
Hot dry rock geothermal reservoirs contrast with conventional production. The first stage involves exploration for and discovery of
geothermal reservoirs in that the rocks are generally deep, rocks in excess of 200ºC at the shallowest possible depth in the
impermeable and with little or no porosity/fluid content. Hence a subsurface. In the second stage, below-ground engineering of the
geothermal reservoir must be engineered by pumping cool water HDR reservoir is carried out. Cool water flows from injection wells
down an injection well and recovering hot water from a nearby through the subsurface, where it is heated by contact with the hot
production well(s), with flow between the two wells stimulated by rock, to production wells. In an HDR system the water is injected, for
the pressure of injected fluids. example, from a shallower aquifer, and flow between the wells is
The HDR resource is larger and more widespread than the stimulated by the pressure of injected fluids (i.e. the subsurface flow
conventional geothermal resource and, for example, is considered system is engineered). In the third stage a power plant uses heat from
likely to be the future of geothermal energy in the United States the recovered hot water to boil a low boiling point ‘working fluid’
(US Department of Energy, 2004), where the term ‘Enhanced (e.g. iso-pentane). The vaporised working fluid is expanded across a
Geothermal Systems’ or ‘EGS’ is used as a more general term turbine to drive a generator and produce electricity. After electricity
describing HDR. The potential for HDR-generated electricity in generation the cooled water is reinjected into the subsurface to
Australia was recognised from Somerville et al.’s (1994) map of restart the cycle.
estimated temperature at 5 km depth in the Australian crust based The above-ground engineering aspects of HDR systems are
on temperatures measured in 3,291 wellbores. In large areas of largely identical to conventional commercial binary geothermal
Australia the temperature at 5 km is >250ºC. Significantly for electricity plants. The environmental impacts of HDR electricity
HDR development, around 250ºC is considered optimal for generation are likely to be less than those associated with
electricity generation from hot water. The largest area of hot conventional geothermal electricity generation (US Department of
subsurface rock recognised by Somerville et al. (1994) underlies Energy Efficiency and Renewable Energy Website, 2004). For
the Great Artesian Basin. This explains the presence of the hot discussion of the long term behaviour and thermal recovery of HDR
aquifers of the Great Artesian Basin (Burns et al. 2000) and the reservoirs see, for example, Swenson et al. (2000).
targeting by Geodynamics Ltd of the underlying basement. The original concept of engineered HDR reservoirs involved
Temperatures in the Cooper Basin sector of the Great Artesian injection of high pressure fluids to create simple, vertical, planar,
Basin are well constrained by borehole data due to hydrocarbon tensile hydraulic fractures between injection and production wells
exploration. (Evans et al. 1999). However, it is now recognised that the best
Thermal modelling of the South Australian Heat Flow hydraulic linkage between boreholes results from enhancing the pre-
Anomaly (SAHFA; Neumann et al. 2000; Fig. 1), which is only existing natural fracture system (Evans et al. 1999). Injection of high
sparsely sampled by relatively shallow boreholes in Somerville et pressure fluids may cause shear displacement of natural fractures
al.’s (1994) map, indicates that geothermal gradients there may be which may remain open due to asperities on the fracture surface.
in excess of those in the Cooper Basin given circumstances Seismic recorders in wells surrounding the injection well
outlined in the thermal modelling presented herein. Furthermore, monitor microseismic events caused by the propagating fracture
anomalously hot regions within the SAHFA are in reasonable system as the fluid is injected into the subsurface thermal reservoir.
proximity (approx. 100 km) to the national electricity grid and to This monitoring is a critical aspect of HDR design as the location of
major minesite clients, such as Olympic Dam and Prominent Hill. these microseismic events indicates the preferential fracture/flow
The recognition of the SAHFA as a potential geothermal source directions in the subsurface and guides the location and trajectory of
the production wells (Brown & Duchane 1999). Experimental HDR
has led to an alternative geothermal energy strategy in South
systems to date have generally involved one injection and one
Australia, which has been proposed by Petratherm Ltd. This
production well. However, commercial systems are likely to utilise a
alternative strategy involves exploration for the highest geothermal
triplet of deep wells, with production wells on opposite sides of the
gradients in proximity to electricity markets and optimal
injection well, in recognition of the ellipsoidal rather than spherical
exploitation of those hot rocks either as engineered HDR systems
shape of subsurface fluid flow (Brown & Duchane 1999). Numerous
and/or enhanced Hot Wet Rock (HWR) and/or conventional
waterfloods of both naturally fractured and unfractured petroleum
geothermal systems. The key rationale of Green Rock reservoirs have indicated that fluid flow is strongly focussed in the
Energy/Perilya in applying for licences in the vicinity of Olympic present-day maximum horizontal stress direction on either side of
Dam has similarly been to seek the highest geothermal gradients in the injection well (Heffer & Lean 1993; Yale et al. 1994).
proximity to electricity markets (Adrian Larking and Simon Hot dry rock geothermal energy was originally considered a
Ashton, pers. comm. Green Rock Energy Pty Ltd 2004). Pacific resource distinct from conventional geothermal energy (as described
Power and Geodynamics have also undertaken such a strategy in in the introduction). However, the results of deep drilling have
identifying a potential HDR resource in the Hunter Valley, New revealed that fractures may provide permeable pathways even at
South Wales. great depth in the crust (e.g. Fehler 1989; Shapiro et al. 1997). This
This paper briefly reviews the HDR process and the experience has been dramatically demonstrated in the Geodynamics Habanero-
of major HDR developments worldwide to date. It then 1 well in the Cooper Basin where mud weights had to be increased
summarises the licencing and political framework for geothermal to prevent high-pressure fluids in the granite from entering the
exploration in Australia, focussing on South Australia which has wellbore (Wyborn et al. this volume). Recognition of the presence of
become the focus for geothermal exploration in Australia, both fluids at great depth has led to the concept of engineered hot wet rock
because of its exceptionally hot rocks and because of its licencing (HWR) reservoirs. In the HWR system, hydraulic stimulation is used
framework. Finally, the paper summarises Petratherm’s approach to for permeability enhancement and for sustaining production in
geothermal energy exploration. A companion paper discusses reservoirs that exhibit minor flow. The HWR concept recognises a
techniques for optimising the subsurface fluid flow between continuum between HDR and conventional geothermal resources.
injection and production wells, recognising the influence of pre- The authors believe that a resources pyramid of geothermal
existing natural fractures and of the in situ stress field on hydraulic energy, akin to that recognised for fossil fuels, will be progressively
stimulation of the thermal reservoir (Reynolds et al. this volume). recognised (Fig. 2). The resources pyramid concept suggests that

414 PESA Eastern Australasian Basins Symposium II Adelaide, 19–22 September, 2004
 HOT DRY ROCK GEOTHERMAL EXPLORATION IN AUSTRALIA

Small volumes that are Conventional Reservoirs

technologically easy
to develop

Improved Technology
High-Medium Shallow,
Quality high permeability,
hot aquifers

Low Tight gas Deeper, tighter

permeability oil sands hot aquifers

Large volumes Gas Heavy Coalbed Hot wet rocks/ fractured basement
that are shales oil methane Unconventional
technologically
difficult to
develop Gas hydrates Oil shale Hot dry rocks

PETROLEUM GEOTHERMAL

Figure 2. Petroleum and geothermal resource pyramids. The petroleum resource pyramid is from Holditch (2003).

there is a small amount of prime resources that are easy to extract. industry, as described herein. There is also a commercial HDR
There is also a much larger volume of resources that are venture in El Salvador where Shell is working with Salvadorian
technologically more difficult to extract. Over time, resources near firm GESAL in a project to create 2–5 MW of power at a known
the top of the pyramid are depleted and technological developments natural hydrothermal site (Fischer 2004).
lead to resources further down the pyramid being developed cost- The most advanced HDR project is at Soultz-sous-Forêts
effectively. Indeed deep gas in low-permeability reservoirs, long (France) on the western edge of the Rhine Graben, about 50 km
considered a resource below the economic cut-off in the hydrocarbon north of Strasbourg. The site is on the former Pechelbronn oil field
resources pyramid, now constitutes around 25% of US natural gas and was selected because of the high heat flow anomaly observed
reserves (Holditch 2003). If the geothermal industry follows a similar in oil wells (Baria et al. 1999). Soultz-sous-Forêts is the principal
pattern, evolution from hot, shallow, high-permeability aquifers to European HDR site and exhibits temperatures of 168ºC at 3.5 km.
deeper, tighter aquifers, to hot fractured basement (HWR), to hot dry The Soultz project commenced as a research project (funded by France,
rocks (HDR) is similarly predicted. Germany and the European Commission) but the project is now being
commercialised by an industry consortium, ‘EEIG Heat Mining’ that
includes Shell International and utilities such as Electricité de France.
Hot dry rock geothermal energy: Two wells, 450 m apart, were drilled to a depth of 3.6 km at
Soultz between 1987 and1997. During 1997 a circulation test
historical and international demonstrated the feasibility of the HDR concept. Water circulated
developments between the two wells at a rate of 25 litres per second for a period
of 4 months without any water losses. The water reached the
The concept of extracting geothermal energy from HDR by
surface at a temperature of 140ºC and maintained its temperature
circulating water through an engineered reservoir originated in the
during the test. Following this successful test, one of the wells was
United States more than 30 years ago. The original HDR patent,
deepened to 5 km, and rock temperatures of 200ºC. This well was
which has now expired, was issued to Los Alamos National
stimulated creating a reservoir 1500 m long and 500 m wide. A
Laboratory in 1974 (Brown & Duchane 1999). From 1974, Los
second well has been drilled into this reservoir 650 m away and
Alamos National Laboratory conducted numerous experiments at
water successfully circulated between the two wells. The planned
Fenton Hill (New Mexico) where recent volcanism creates a local
scientific pilot plant will be a triplet of wells with a second
hotspot with temperatures reaching 327ºC at the base of a 4.4 km
producer recently completed on the other side of the injector. All
vertical depth well (Brown & Duchane 1999). Tests at Fenton Hill
the wells are started from a single platform. The project has shown
demonstrated that it was possible to drill into hot, impermeable
that the fracture network in the basement at Soultz-sous-Forêts is
granite and create flow passages that stayed open despite the high
well developed with a degree of permeability and this project is
earth stresses tending to close fractures. Rather than new fractures
perhaps closer to an HWR development than an end-member HDR
being formed, all the evidence pointed towards the opening of an
project (Baria et al. 1999; Brown & Duchane 1999).
interconnected array of existing joints that had been sealed by
There are several additional HDR/HWR projects worldwide.
hydrothermal processes. The first-opened joints were, as might be
However, it is beyond the scope of this paper to summarise all of
expected, oriented in a direction approximately orthogonal to the
these and the reader is referred to the following:
present-day least principal stress (Brown & Duchane 1999).
• Rosemanowes, UK (Parker 1999)
The Fenton Hills test plant produced power and conducted
• Fjällbacka, Sweden (Wallroth et al. 1999)
stimulation and flow tests for 17 years (1978–1995). Circulation
• Hijiori, Japan (Kuriyagawa & Tenma 1999
tests were completed at heat extraction rates of up to 10 MW
www.nedo.go.jp/chinetsu/hdr/hijiorinow.htm)
thermal with small pressure losses and water losses as low as 7%
• Ogachi, Japan (Hori et al. 1999)
of the water injected (Abé et al. 1999). Ultimately the plant was not
• Deep Heat Mining, Basel, Switzerland (www.dhm.ch)
commercial, but much of our understanding of the potential of
• Stadtwerke Bad Urach, Germany
HDR geothermal energy derives from this project. The Fenton
(www.geothermie.de/bad_urach2.htm)
Hills site has now been decommissioned with the US Department
• Geodynamics Habanero-1 project, Cooper Basin, South
of Energy declaring its intent to pursue future HDR work through
Australia (Wyborn et al. this volume;
the commercial geothermal industry. Australia has recently become
www.geodynamics.com.au).
the focus for the present-day, commercially-supported HDR

PESA Eastern Australasian Basins Symposium II Adelaide, 19–22 September, 2004 415
 R.R. HILLIS, ET AL.

The Australian regulatory

framework: Geothermal
Exploration Licences
As an onshore resource, the regulatory framework for HDR
developments in Australia lies in the remit of the State Governments.
New South Wales was the first state in Australia to develop legislation
specifically for geothermal energy. In 1992 New South Wales
modified regulations under the Mining Act to define ‘geothermal
substances’ as a mineral. This allowed the issue of mineral licences
for the exploration for and production of ‘geothermal substances’.  
 
‘Geothermal substances’ were initially defined as any underground 
substance that was not already specifically defined as a mineral, and 


‘that occurs, because of the natural heating processes of the earth, at  

temperatures exceeding 80 degrees Celsius’. In 1998 this definition  $'(/$,'( 
was modified to include substances artificially introduced
   .LORPHWUHV
underground (as well as those naturally occurring) heated to
temperatures exceeding 100ºC. This modification was made to ensure /DPEHUW&RQIRUPDO&RQLF

that water injected to extract heat from hot dry rocks was covered by
the Act. The modified definition also increased the temperature cutoff *HRWKHUPDOH[SORUDWLRQ
OLFHQFH*(/
from 80–100ºC to exclude local use of warm groundwaters (e.g. spas,
*HRWKHUPDOH[SORUDWLRQ
aquaculture). Royalty is payable at 4% of the geothermal substance OLFHQFHDSSOLFDWLRQ*(/$
value. Pacific Power subsequently won a tender for an area in the
Hunter Valley, but has since withdrawn from the licence, which was
Figure 3. Geothermal Exploration Licences in Australia.
taken over and extended by Geodynamics (Table 1; Fig. 3).
The approach taken in South Australia differed from that of
New South Wales. South Australia began a review of the Petroleum
Table 1. Current HDR Licences in Australia.

Licence Company State Area Target Target Depth Status

(km2) Temp. (°C) (m)
GEL 97, 98 Geodynamics SA 991 250 4,000–4,500 First deep well
(Habanero-1) drilled to
4.4kms and successfully
stimulated in 2003.
Planning to drill 2nd well
in 2004 to establish
circulation.
GEL 99 Scopenergy SA 496 235–265 3,000–4,000 Capital raising to
undertake initial 5 well
program
GEL 156 MNGI/Petratherm SA 498 >200 3,000–4,000 Reviewing data and
GEL 157 MNGI/Petratherm SA 496 >200 3,000–4,000 developing hot rock
GEL 158 MNGI/Petratherm SA 499 >200 3,000–4,000 exploration models.
Petratherm initial public
offering (IPO) at time of
writing.
GELA 128, Perilya/Green Rock SA 2456 >200 4,000–5,000 Licences offered (except
129, 161, Energy areas covering WMC
162, 163 operations), awaiting
acceptance
EL 5560, Geodynamics NSW 490 200–250 4,000–5,000 Planning to drill two
5886 shallow holes for the
determination of the
temperature gradients in
the centre of the Bulga
gravity low.
EL 2114 Longreach Oil/ NSW 5500 Unknown Unknown Undertaking initial
Hot Rock Energy evaluation of area

416 PESA Eastern Australasian Basins Symposium II Adelaide, 19–22 September, 2004
 HOT DRY ROCK GEOTHERMAL EXPLORATION IN AUSTRALIA

Act, 1940 in 1996, as part of a general initiative to bring the 1RUWKHUQ7HUULWRU\ 4XHHQVODQG
petroleum regulatory regime in South Australia up to modern
regulatory practice. Coincidently in 1996, Ashton Energy 0RRPED
attempted to apply for exploration licences for geothermal energy


in the Olympic Dam area under the Petroleum Act. However, these
could not be granted, as the Petroleum Act at that time did not
include such rights. The area has recently been offered to a joint
venture between Perilya and Green Rock Energy, with the consent *HRG\QDPLFV
$'(/$,'(
of Ashton (Table 1; Fig. 4). Representations were also made from

+DEDQHUR
other parties, as part of the review process seeking a legislative 
framework for HDR exploration in South Australia. Given that the 6FRSH(QHUJ\ 
most prospective area for HDR in South Australia was perceived to


be granites underlying the Cooper Basin oil and gas fields, it was 0RRPED
felt that the Petroleum Act was the most appropriate way to 
regulate geothermal energy. Furthermore, the drilling and
production technology (i.e. fluids under pressure) to be applied was
petroleum-based, and there was potential for conflict with
coincident petroleum rights. A specific set of licences was
developed for geothermal exploration and production (GELs – 01*,
Geothermal Exploration Licences and GPLs –Geothermal  
Production Licences), with a limit of 500 km2 for a single
exploration licence. This size limit allowed three separate licences

1HZ6RXWK:DO HV

to be offered in the Cooper Basin area and was chosen to allow
multiple parties to be involved and to encourage innovation in the 
 
development of the resource. The definition of geothermal energy  3HULO\D*UHHQ
in the Petroleum Act, 2000 differed from that in New South Wales,  5RFN(QHUJ\
in that it is exclusively for HDR and excludes conventional *HRWKHUPDOZHOO
*HRWKHUPDOH[SORUDWLRQ
geothermal resources (hot groundwater). Conventional geothermal OLFHQFHDSSOLFDWLRQ*(/$    .LORPHWUHV
resources are regulated via the Water Resources Act. *HRWKHUPDOH[SORUDWLRQ
The South Australian legislation defined a source of geothermal OLFHQFH*(/ /DPEHUW&RQIRUPDO&RQLF

energy as a ‘regulated resource’ (i.e. the emphasis was on the heat

Figure 4. Geothermal Exploration Licences in South Australia.
in rocks rather than on hot water as the resource) and defined it as
‘thermal energy contained in subsurface rock or other subterranean
heating public buildings. Proponents are also considering its use
substances which is extracted or released by means other than as
for electricity generation using low flashpoint technology. The
part of the production of a naturally occurring underground
accumulation of a substance’. In October 2000, shortly after the Victorian government is reviewing legislation for geothermal
Petroleum Act, 2000 was enacted, three areas were offered for resources, driven by a petroleum licensee who has shown
competitive tender (work program bidding) and three consortia interest in acquiring rights to geothermal resources in eastern
responded. Since then two consortia have combined, leaving GELs Victoria. Geothermal energy resources are currently provided
97 and 98 with Geodynamics and GEL 99 with Scopenergy (Table for under the Water Act, 1989. However, this legislation does not
1; Fig. 4). Subsequently, a number of other areas in the state have currently address some significant issues in relation to
been the subject of GELs by MNGI/Petratherm and Perilya/Green geothermal energy, such as a definition of geothermal energy,
Rock Energy (Table 1; Fig. 4). Royalty is payable on geothermal security of tenure, or ownership of the resources. At this stage it
energy at the rate of 2.5% of value. It is the South Australian is not clear if separate legislation is to be enacted, or if the
Government’s belief that geothermal exploration is not ‘mining’ existing Petroleum Act is to be amended, or if in fact no
under the Commonwealth Native Title Act, and therefore GELs can legislative changes are to be made.
be issued without the right-to-negotiate process. The Northern Territory, Western Australia and Tasmania have no
Currently, Queensland has no legislative basis to allow or specific legislative framework for geothermal energy, and have no
regulate the exploration for potential geothermal energy resources, plans to develop such legislation in the short term, given that no interest
although it may have high-temperature resources similar to South has been expressed in exploring for geothermal energy in these areas.
Australia, in addition to current conventional geothermal
exploitation (the Birdsville plant). During 2003, the Queensland
Department of Natural Resources, Mines and Energy drafted a The political framework: Renewable
Geothermal Exploration Bill to enable commencement of Energy Certificates
geothermal exploration in Queensland, largely in response to
interest shown by Geodynamics for an area of the Cooper Basin in The Commonwealth Government introduced the Renewable
southwest Queensland. Specific targeted consultation has occurred Energy (Electricity) Act, 2000 to encourage the use of renewable
on this Bill. The Bill allows Geothermal Exploration Licences up energy. One of the initiatives introduced by this act is the
to 600 km2 to be offered by competitive tender. All geothermal Mandatory Renewable Energy Target (MRET). The aim is to
resources (HDR and conventional) are covered, but minor local achieve an additional 2% of Australia’s electricity from renewable
users will be excluded. The legislation to cover production is still sources. The objectives of this act are:
to be finalised, but it is anticipated that a royalty will apply, based • to encourage the additional generation of electricity from
on a cents-per-gigajoule basis. The Queensland Minister for renewable sources
Natural Resources, Mines and Energy introduced the Geothermal • to reduce emissions of greenhouse gases
Exploration Bill 2004 to State Parliament on 20 April 2004. • to ensure the renewable energy sources are ecologically
Victoria is considered to have relatively low-temperature sustainable.
geothermal resources, occurring as warm groundwater, although The renewable generation targets are assigned to electricity
there is potential for HDR. Warm groundwater has been utilised retailers on the basis of how much electricity they sell. The task, as
to a limited extent since 1983, particularly in Portland for mandated by the Renewable Energy (Electricity) Act, 2000, is to

PESA Eastern Australasian Basins Symposium II Adelaide, 19–22 September, 2004 417
 R.R. HILLIS, ET AL.

generate 9,500 GWh of electricity per annum from renewable means

by 2010. The Electricity Supply Association of Australia estimates that
an additional 3,000 MWe of renewable capacity will need to be brought
on-line to generate the required amount of renewable electricity.
Generators of electricity from renewable sources may register
with the Office of the Renewable Energy Regulator and receive
Renewable Energy Certificates (RECs) for the renewable energy
that they generate. These certificates can be traded with electricity
retailers, which are required to obtain and surrender a certain
amount of RECs per year. There is a non tax-deductible penalty of
$40 per MWh for retailers who fail to surrender the correct number
of certificates. This price is anticipated to encourage new
renewable electricity generation projects and has a major impact on
the commercial competitiveness of HDR-generated electricity.
The MRET Review Panel was established in September 2003 and
its report recommends that after 2010 the $40 penalty should be
indexed and that RECs should have a 15 year period applicable to all
projects commenced after 2005. The panel also recommended that the
renewable energy target should be increased to 20,000 GWh by 2020.

Petratherm’s geothermal energy

exploration program
Currently, MNGI, a wholly-owned subsidiary of Minotaur Figure 5. South Australian Heat Flow Anomaly (shaded area, amended
Resources, holds GELs 156, 157 and 158 in South Australia (Table from Cull, 1982; Neumann et al., 2000). Figures are heat flow in mWm-2.
1; Fig. 4). At the time of writing an IPO (initial public offering) is Darker shading within SAHFA represents extent of Neoproterozoic
planned for geothermal energy company, Petratherm Ltd. metasediments. Dashed lines represent inferred boundaries of Gawler and
Petratherm will purchase MNGI, and its ownership and analysis of Curnamona Cratons.
GELs 156, 157 and 158, from Minotaur Resources in exchange for
a shareholding in Petratherm. previous petroleum exploration, only drilling will confirm the
The Petratherm geothermal energy exploration programme is unusually high geothermal gradients sought). Petratherm have
based around the key cost parameters for HDR geothermal energy, developed a programme of thermal modelling and shallow drilling
which are: to minimise this exploration-related risk. Thermal models will be
• temperature of the hot rock reservoir and thus of the developed for all geothermal targets and these will be tested with
recovered water relatively shallow, 750 m, slimline holes. Deeper drilling will then
• flow rate of the recovered water focus on the targets displaying the highest geothermal gradients.
• drilling costs (hence depth of the hot rock reservoir) GELs 156, 157 and 158 were obtained within the South
• location with respect to market (electricity grid or customer) Australian Heat Flow Anomaly (SAHFA; Neumann et al. 2000;
• above-ground plant costs and efficiency. Fig. 5) because it is an exceptional target for exploration of
Petratherm has developed a programme to minimise these costs geothermal energy. The average heat flow in the SAHFA is almost
that differs from previous HDR projects. The Cooper Basin is a twice that of typical Proterozoic crust (e.g. McLaren et al. 2003).
current focus for HDR activity because previous petroleum wells While the dataset is sparse, the average heat flow in the SAHFA is
in the area encountered anomalously high geothermal gradients. around 90 mWm-2 (Cull 1982; Houseman et al. 1989; Fig. 5). The
Likewise the Soultz-sous-Forêts site is on the former Pechelbronn global average heat flow from Proterozoic continental crust is
oil field and was selected because of the temperatures experienced around 50 mWm-2 (e.g. Morgan 1984; Nyblade & Pollack 1993).
in petroleum wells. However, discounting volcanic areas, it is Outcropping felsic rocks within the SAHFA (including the Mt
possible that the Cooper Basin and the Soultz site may not exhibit Painter Inlier; Curnamona Province and eastern Gawler Craton)
the highest geothermal gradients in Australia or Europe contain anomalously elevated uranium and thorium contents,
respectively. which result in the very high heat production rates.
Rather than relying on high temperatures previously Heat flow is high throughout the SAHFA, reaching almost 130
encountered in petroleum provinces, Petratherm has developed a mWm-2, in the northern part of the SAHFA (Fig. 5). In order to
programme of exploration for the highest geothermal gradients in encounter the unusually high geothermal gradients sought by
proximity to electricity markets. This is also the philosophy of Petratherm, areas with high heat flow and low thermal-
Green Rock Energy/Perilya in applying for licences in the vicinity conductivity cover sediments are required (as further discussed in
of Olympic Dam (Adrian Larking and Simon Ashton, pers. comm., the following section on thermal modelling). There are three
Green Rock Energy Pty Ltd 2004). Furthermore, sophisticated distinct geothermal styles within GELs 156, 157 and 158 that have
analysis of natural fracture patterns and in-situ stresses will be the potential to satisfy these requirements:
undertaken in order to optimise fluid flow through the subsurface • thermally anomalous granites (TAGs) buried by younger,
geothermal reservoir (as described in a companion paper by insulating cover
Reynolds et al. this volume). The Petratherm programme will • radiogenic iron oxides (RIOs) buried by younger,
enable optimisation of all four of the subsurface cost parameters insulating cover
with respect to HDR developments. • enhanced natural thermal systems (ENTs).
The potential risks and rewards of a hot rock exploration Granites in general generate anomalously high heat flows
programme are apparent. The potential rewards are hotter rocks at compared to other rock types due to their relatively high content of
shallower depth and closer proximity to electricity markets. The radiogenic potassium, uranium and/or thorium. However, many of
risks are those associated with exploration (i.e. unlike in areas of the granites within the SAHFA are thermally anomalous compared

418 PESA Eastern Australasian Basins Symposium II Adelaide, 19–22 September, 2004
 HOT DRY ROCK GEOTHERMAL EXPLORATION IN AUSTRALIA

Figure 6. Relationship between thermal conductivity of a cover sequence, depth of burial of heat-producing basement and temperature. The values on the
curves are the heat flow (mWm-2) The average heat flow in the SAHFA is around 90 mWm-2 (pink curve). The red line allows rapid evaluation of the parameter
ranges required to generate temperatures >250ºC. Generating temperatures >250ºC at <4km, for the average heat flow in the SAHFA, would require
exceptionally low thermal conductivities. However for a heat flow similar to the Mt Painter region (~130 mWm-2), temperatures >250ºC at <4 km can be
attained with cover or average thermal conductivity.

to normal granites. For example, the average heat production rate circumstances outlined in the thermal modelling herein. Measured
in the Mt Painter Inlier is 10 µWm-3 (Neumann et al. 2000), which heat production rates in RIOs may be as much as 50 times greater
is around four times the rate of average granite (McLennan & than those in average granites (Houseman et al. 1989). The gravity
Taylor 1996). The granites of the SAHFA are amongst the most and magnetic signatures of the Ferguson Hill prospect within GEL
thermally anomalous granites in the world. GEL 156 includes the 158 is the same as that of known RIOs. A mineral exploration test
partially outcropping and partially covered Mt Painter granites. hole to 1,500 m did not encounter the top of this body and
Only younger cover rocks outcrop within GEL 157, but gravity geophysical modelling suggests that its top is at approximately 2
data indicate a large buried granite that we term the Callabonna km. No temperature measurements are available for the hole, but
Granite, about 50 km northeast of Mt Painter and possibly part of such will be sought as part of the exploration programme.
the same suite of TAGs. Petratherm will use gravity data to Although RIOs are much hotter than TAGs, they are smaller in
determine the depth to the top of the granites within its permits and volume, thus their thermal footprint is smaller and geophysical and
thermal modelling (as discussed in the following section) to then thermal modelling and test drilling must be suitably focussed.
determine the optimum geothermal targets. As discussed earlier, we recognise a resources pyramid for
Granites have been a key focus in HDR projects worldwide, geothermal energy from hot, shallow high-permeability aquifers to
but radiogenic iron oxides (RIOs), such as those known in South deeper, tighter aquifers, to hot fractured basement (HWR) to hot
Australia at Olympic Dam and Prominent Hill, also have the dry rocks (HDR). There is a continuum through these geothermal
potential to generate exceptionally high geothermal gradients given resource types. The third geothermal style mentioned above

PESA Eastern Australasian Basins Symposium II Adelaide, 19–22 September, 2004 419
 R.R. HILLIS, ET AL.

350 likely subsurface thermal parameters within the SAHFA. If we

Thermal conductivity = 2 Wm -1K-1 neglect the role of fluid flow in modifying the near surface thermal
300 field, the basic control on the near surface geothermal gradient is
130 the interplay between the insulating properties of the uppermost
temperature °C

250 crust and the heat flow field. For the SAHFA, surface heat flows lie
110 in the range 70–130 mWm-2 (e.g. Cull 1982; Houseman et al.
200 90 1989). Figure 6 shows the thermal implications of burying a
basement complex that generates anomalous heat flow in the range
150 70 70–130 mWm-2 with varying thicknesses of cover of varying
thermal conductivity, assuming:
100 • typical mantle heat flow of 25 mWm-2 in accord with the
seismic shear wave velocities pointing to thermally ‘normal’
50 mantle (e.g. Zielhuis & Van der Hilst 1996; Debayle &
Kennett 2003)
depth (km)
0 • a granitic layer 5 km thick with a heat production rate of
0 1 2 3 4 5 9 µWm-3 (typical of many of the TAGs in the SAHFA) at the
base of the insulating cover sequence
Figure 7. Relationship between depth of burial and temperature for a range
• a cover sequence generating 1 µWm-3
of heat flows, and assuming a constant thermal conductivity of a cover
sequence. The grey-shaded region in Figure 6 is the range of typical
thermal conductivities of cover sedimentary rocks (i.e. 1.5–2.5
Wm-1K-1). Temperatures of 250ºC (the thick horizontal line) at 3
comprises enhanced natural thermal systems (ENTs). In the km, require high heat-flow and low thermal-conductivity cover
anomalously hot environment of the SAHFA, pre-existing faults rocks, both at the extreme of accepted parameter ranges. It is
may focus natural superheated groundwater flow. For example, the apparent that temperatures >250ºC at 3 km are very unlikely.
Paralana Hot Springs occur along a major fault zone at the eastern Conversely, temperatures of 200ºC at 3 km within the SAHFA are
margin of the Flinders Ranges within GEL 156. Surface water entirely plausible. Figure 7 is effectively a slice through Figure 6,
temperatures at Paralana have been measured at 62ºC. The springs and shows the relationship between depth of burial to a heat-
have only low flow rates (i.e. groundwater may cool while coming producing source such as a TAG or RIO and temperature for a
to the surface) and there is evidence of near-surface mixing with thermal conductivity of 2 Wm-1K-1 in the cover rocks. For such
cool groundwaters. Hence the groundwater temperature may be average thermal-conductivity cover rocks, a high heat flow of ~130
significantly higher at shallow depths. Many faults similar to that mWm-2 is associated with temperatures of approximately 200ºC at
at Paralana can be recognised on aeromagnetic data and represent 3 km and 250ºC at 4 km. Conditions such as these may be present
potential HWR or even conventional geothermal targets. Efficient in the Mt Painter region.
circulation between injection and production wells is a critical The above calculations suggest that for temperatures >200ºC
issue for HDR systems (see also Reynolds et al. this volume) and the cover rocks must exhibit low thermal conductivity, heat flows
we believe that augmenting an existing flow system increases the must be high and depths must be at least 3 km. It is apparent from
probability of obtaining efficient subsurface fluid circulation Figure 7, that the thermal conductivity of the cover rocks is as
compared to an entirely engineered system. Furthermore, such important as the heat generation rate in the basement. This
natural thermal systems may provide convective heat flow into the highlights that exploration for geothermal energy must focus
reservoir during its exploitation, potentially improving its thermal significant attention on the thermal conductivity of the cover rocks.
behaviour beyond that which would be predicted if heat transfer The thermal conductivity of cover rocks in the shallow test holes,
into the reservoir were purely conductive. as well as temperatures, will be measured in order to refine the
It is important to recognise the continuum between geothermal thermal models and select the optimum targets for deeper drilling.
resource types. Although TAGs or RIOs may be the ultimate source
of heat, subsurface geothermal circulation systems need not target
the heat-producing basement rocks themselves and can target Conclusions
immediately overlying cover rocks if they are sufficiently hot. Such
cover rocks may be Great Artesian Basin aquifers, such as those The EEIG Heat Mining industry consortium operating the
already exploited at Birdsville’s conventional geothermal plant, or Soultz-sous-Forêts site, Shell’s involvement in an HDR project in
the deeper, tighter, Cooper Basin rocks that are exploited for oil El Salvador, Geodynamics’ Habanero-1 well in the Cooper Basin
and gas. Hence commercial exploration for basement HDR and the current IPO for Petratherm Ltd. all indicate that HDR
geothermal resources should not neglect the conventional projects are moving from the research to the commercial realm.
Furthermore, in contrast to the conventional geothermal energy
geothermal potential of overlying aquifers or indeed HWR
industry, in which Australia is a very minor player, Australia is
opportunities. Multi-target wells testing multiple geothermal
playing a key role in current HDR developments. Geothermal
resource types present an important exploration opportunity.
Exploration Licences have been issued in two States: New South
Wales and South Australia, in the former under mining legislation
and in the latter under petroleum legislation.
The South Australian heat flow Hot dry rock projects to date have largely focussed on areas of
anomaly and thermal modelling known high geothermal gradient, such as those in volcanic regions
and those where high gradients have been demonstrated in
This section of the paper demonstrates that temperatures of petroleum exploration. Given that attaining high temperatures at
250ºC may be developed under suitable circumstances within the shallow depth and the location of such with respect to the
South Australian Heat Flow Anomaly (SAHFA) at depths <4 km, electricity market are critical to the commercial viability of
providing very high heat-producing basement (such as TAGs and geothermally-generated electricity, Petratherm is undertaking a
RIOs) and thermally insulating cover rocks can be located. programme of exploration for the highest geothermal gradients
Thermal modelling is the first stage in the exploration for closest to electricity markets. It holds tenements within the
exceptional geothermal gradients and has been undertaken for exceptionally hot South Australian Heat Flow Anomaly and will

420 PESA Eastern Australasian Basins Symposium II Adelaide, 19–22 September, 2004
 HOT DRY ROCK GEOTHERMAL EXPLORATION IN AUSTRALIA

target buried thermally anomalous granites (TAGs) and radiogenic HORI, Y., KITANO, K., KAIEDA, H. and KIHO, K., 1999. Present
iron oxides (RIOs) as well as enhanced natural thermal systems status of the Ogachi HDR project, Japan, and future plans.
(ENTs, essentially HWR systems) within the SAHFA. Thermal Geothermics, v. 28, 637–645.
modelling indicates that, under suitable circumstances, HOUSEMAN, G.A., CULL, J.P., MUIR, P.M. and PATERSON,
temperatures of 250ºC may be attained at depths <4 km in H.L., 1989. Geothermal signatures and uranium ore deposits on
association with such targets. the Stuart Shelf of South Australia. Geophysics, v. 54, 158–170.
There exists a resources pyramid for geothermal energy, akin to HUTTRER, G.W., 2001. The status of world geothermal power
that recognised for petroleum resources, from hot, shallow, high- generation 1995-2000. Journal of the Japan Geothermal
permeability aquifers to deeper, tighter aquifers, to hot fractured Energy Association, v. 38, 27–45.
basement (HWR) to hot dry rocks (HDR). There is a continuum KURIYAGAWA, M. and TENMA, N., 1999. Development of hot
through these geothermal resource types. Hence commercial dry rock technology at the Hijiori test site. Geothermics, v. 28,
exploration for basement HDR-type geothermal resources in 627–636.
Australia should not neglect the conventional geothermal potential MCLAREN, S.N., SANDIFORD, M., HAND, M., NEUMANN,
of overlying aquifers or indeed HWR opportunities. Multi-target N.L., WYBORN, L.A.I. and BASTRAKOVA, I., 2003. The
wells testing multiple geothermal resource types present an hot southern continent: heat flow and heat production in
important exploration opportunity. Australian Proterozoic terranes. In: Hillis, R.R. and Müller,
R.D. (Eds), Evolution and Dynamics of the Australian Plate,
Geological Society of Australia Special Publication 22 and
Acknowledgements Geological Society of America Special Paper 372, 157–167.
Hillis, Hand and Mildren are all consultants to Petratherm and MCLENNAN, S.M. and TAYLOR, S.R., 1996. Heat flow and the
will have a financial interest in the company if the IPO is chemical composition of continental crust. Journal of
successful. Hillis is also a non-executive director of Petratherm. Geology, v. 104, 369–377.
Ben Armstrong of Scopenergy is thanked for information on their MORGAN, P., 1984. The thermal structure and thermal evolution of
activities in GEL 99. Adrian Larking of Perilya is thanked for the continental lithosphere. In: Pollack Henry, N. and Murthy, V.
information on GELs 128 and 129. Geoff Collins (DNRE, R. (Eds), Structure and evolution of the continental lithosphere.
Victoria), Mike Armstrong (DMR, New South Wales) and Russel Physics and Chemistry of the Earth, v. 15, 107–193.
Darcy (NRM&E, Queensland) are thanked for information on NEUMANN, N., SANDIFORD, M. and FODEN, J., 2000.
geothermal energy legislation in their respective States. Regional geochemistry and continental heat flow; implications
for the origin of the South Australian heat flow anomaly. Earth
and Planetary Science Letters, v. 183, 107-120.
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