Towards an Industry Guideline for Geothermal Reserves Determination
Conference Paper: Towards an Industry Guideline for Geothermal Reserves Determination
The recent trend for financing of geothermal development companies through stock market listings presents a welcome market-driven mechanism for funding the exploration and development of geothermal prospects. However, this process depends heavily upon being able to demonstrate the value added at successive stages within the long development path from exploration to power generation, and in particular for investors to have confidence in the claims made by developers about the energy resources and reserves available within each project. Similar requirements apply, in fact, to all forms of capital market financing. A standardised and trusted approach to geothermal energy resources and reserves classification and estimation is required for the stability of our industry.
We offer here a starting point for the development of such a methodology broadly based upon mining industry principles and work recently finalised by the SPE, but with regard to the specific characteristics of geothermal resources and considering current trends for development of EGS, HDR and lower temperature systems. We suggest that any useful methodology must include a categorisation such as “Proven-Probable-Inferred” categories that indicate to the investor how reliably various parts of any geothermal resource are defined rather than primarily relying on probabilistic methods using parameter distributions applied to the entire resource. However, probabilistic methods can be usefully applied to each category.The other key categorisation is based upon the commercial viability of extracting energy from the resource. Adopting the SPE approach would mean having “Reserves” defined as the part of the resource that is commercially extractable and “Resource” as the subcommercial component. Commercial viability depends on a range of technical and economic factors making this a potentially complex issue. We suggest that it is probably not practical to have an economic model as part of the reserves assessment, so this could best be achieved through some industry guidelines for what is commercial in the context of the conversion technology that is expected to be applied to the resource.
- A.W. Clotworthy, G.N.H. Ussher, J.V. Lawless and J.B. Randle
- 28th New Zealand Geothermal Workshop; New Zealand; 2006/09/01
- International Geothermal Association, 2006
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A.W. Clotworthy, G.N.H. Ussher, J.V. Lawless, J.B. Randle. 2006. Towards an Industry Guideline for Geothermal Reserves Determination. In: Proceedings. 28th New Zealand Geothermal Workshop; 2006/09/01; New Zealand. New Zealand: International Geothermal Association; p. 10