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Selecting Deep Drilling Targets from Shallow Exploration Geothermal Reservoir Evaluation

Presentation Outline . Exploration Approaches and Key Exploration Questions Surface Exploration Tools and Data Sets Exploration Settings Establishing the Geologic Model and Drilling Targets Testing the Targets Conclusions EGS Inc..

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Selecting Deep Drilling Targets from Shallow Exploration Geothermal Reservoir Evaluation

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    1. Selecting Deep Drilling Targets from Shallow Exploration Geothermal Reservoir Evaluation GRC Annual Meeting, October 2008 Reno, Nevada Paul Brophy, EGS Inc.

    3. EXPLORATION APPROACHES

    4. Exploration Approach Remote Sensing Data - REGIONAL Geologic/Structural and Surface Manifestations Mapping - REGIONAL/EXTENDED PROJECT AREA Geophysical Surveys – EXTENDED PROJECT AREA/ PROJECT Geochemical Sampling and Analysis - EXTENDED PROJECT AREA/PROJECT Exploration Drilling - PROJECT Temperature Gradient/Heat Flow Exploration (Slim, Core, Strat, Deep TG) Holes Production Well Drilling - PROJECT EGS Inc.

    6. Geothermal System Characteristics A heat source (magmatic or nonmagmatic) Convective upflow Recharge by meteoric waters Deep mixing with meteoric waters and/or condensate Boiling and steam migration Outflow of the deep fluids to the surface or other hydraulic base level Features common to all geothermal systems. Henley referred to these features as dynamic features of geothermal systems. Features common to all geothermal systems. Henley referred to these features as dynamic features of geothermal systems.

    7. Key Exploration Questions What is the Resource Temperature? What is the Resource Depth? What is the Resource Quality? How large is the Resource (Area Extent)? How Productive are the Wells? What are the estimates of Resource Longevity? r EGS Inc.

    8. SURFACE EXPLORATION TOOLS AND DATA SETS

    9. Surface Exploration Data Sets Regional

    10. Remote Sensing Data Types Multispectral (several relatively broad bands) Hyperspectral (many narrow bands) Thermal Infrared (TIR – can be multispectral) Panchromatic (gray scale – single very broad band) Radar (microwave) LIDAR (LIght Detection and Ranging - laser) Energy & Geoscience Institute at the University of Utah

    11. TM Full Scene & Zoom to Full Resolution Energy & Geoscience Institute at the University of Utah

    14. Surface Exploration Data Sets Extended Project Area

    15. 2-D MT Data Set Krafla, Iceland

    16. Surface Exploration Data Sets Project Area

    17. EXPLORATION SETTINGS

    18. Exploration Settings

    19. Type A Magma-related, Dry Steam Resources (Example – The Geysers, CA)

    20. Type A - Magma-related, Dry Steam Resources Topography: Rugged? mountainous? Climate: Variable? Depth to Resource: Usually deep ( 5000’ – 10,000’) Surface Manifestations: Restricted Permeability: Low to moderate fracture permeability Environmental/Political: None

    23. Type B – Andesitic-Volcanic Resources Topography: Usually mountainous Climate: Variable – usually high precipitation Depth to Resource: Deep to moderate Surface Manifestations: Restricted – depending on depth and shallow ground water Permeability: Low to moderate fracture permeability – often highly variable Environmental/Political: Some countries with political unrest

    24. Type C - Caldera Resources (Example – Medicine Lake, CA)

    25. Type C – Caldera Resources Topography: Ring fractures often rugged, caldera floor gentle topgraphy Climate: Variable? Depth to Resource: Moderate to shallow (- 7500’) Surface Manifestations: Common Permeability: Low fracture permeability – often with thick tuff units Environmental/Political: Often very scenic – environmentally sensitive

    27. Type D – Sedimentary-hosted, Volcanic Resources Topography: Usually low topographic relief Climate: Arid, low precipitation Depth to Resource: Intermediate (5000 – 8000’) Surface Manifestations: Very restricted Permeability: Variable? Environmental/Political: Usually limited?

    29. Type E – Extensional, Fault-controlled Resources Topography: Rugged on upthrow, low on valley floor Climate: Usually dry with low precipitation Depth to Resource: Usually deep (7000 – 10,000’) Surface Manifestations: Usually restricted to fault traces Permeability: Dominantly fault controlled Environmental/Political: None

    32. Type F – Oceanic, Basalt-hosted Resources Topography: Rugged to flat? Climate: Islands – high precipitation Depth to Resource: Shallow ( 3000 – 6000’ ) Surface Manifestations: Common Permeability: High horizontal permeability, variable vertical permeability Environmental/Political: Environmental sensitive

    33. Geologic Settings of Hydrothermal Systems Magmatic Tectonic Magmatic/Tectonic EGS Inc.

    34. Geologic Settings of Hydrothermal Systems Magmatic Andesitic volcanic fields Indonesia, Philippines, Central/S.America, Cascades Silicic volcanic fields Taupo New Zealand, Coso, CA Basaltic volcanic fields Iceland, Azores, Hawaii Bi-modal volcanism in caldera settings Medicine Lake CA, Valles Caldera, New Mexico EGS Inc.

    35. Geologic Settings of Hydrothermal Systems Tectonic Great Basin – Nevada, Utah Southern portion of Salton Sea EGS Inc.

    36. Geologic Settings of Hydrothermal Systems Magmatic/Tectonic East African Rift Northern portion of the Salton Sea EGS Inc.

    37. Probability of Success for any Stage

    38. Probability of Proving a Viable Project

    39. Probability of Recovering Investment

    40. Cost of Each Phase

    41. Worldwide Geothermal Resource Types EGS Inc.

    42. ESTABLISHING THE GEOLOGIC MODEL AND DRILLING TARGETS

    43. Building the Model upflow zones structural and/or stratigraphic pathways for fluid flow distribution of hydrothermal alteration age of hydrothermal alteration rock types knowledge of fluid chemistry hydrogeologic model for recharge

    44. Drilling Target Selection Old Approach Target overlapping Anomalies New Approach Drill the Model

    51. Testing the Targets (To Slim Hole or not to Slim Hole – that is the question) Slim Hole Advantages Lower cost ( up to 5x lower than Production Well) If cored, can provide good geologic data Can usually provide actual resource temperatures Slim Hole Disadvantages Rarely good geochemical data No flow rate data Difficult to cement casing in core holes No directional capability EGS Inc.

    52. Value of Slim Holes Type A - Steam Reservoirs: Undetermined?? Type B - Andesitic Volcanics: Good Type C - Calderas: Good Type D - Sedimentary/volcanics: Good Type E - Extensional Environments: Good-Moderate Type F - Basaltic Systems: Low

    53. Conclusions Because of the range in types of geothermal systems and the relatively few number of developed resources, we do not have any statistical basis for their characteristics There is no simple formula or procedure that tells you where to drill your first well – each project must decide that based on site specific conditions. More prudent explorers target wells based on a combined geologic, structural and hydrogeologic models rather than on surface anomalies. Priority targets are generally the upflow zones, often occurring at fault intersections Use of slim holes is heavily dependant on site specific geologic conditions EGS Inc.

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