Geothermal: Is Saskatchewan’s energy future in hot water?

DEEP drilling in southeast Saskatchewan
DEEP drilling in southeast Saskatchewan

This fall, Deep Earth Energy Production Corp. (DEEP) made history with its ground-breaking, deep horizontal well in southeast Saskatchewan.

“This is the deepest horizontal well Saskatchewan’s history and the first 90-degree horizontal fluid production well in the world to be drilled and hydraulically stimulated for geothermal power generation,’’ the Saskatoon-based company announced November 26.

In fact, DEEP president and CEO Kirsten Marcia says the company’s wells have set several firsts in Saskatchewan, Canada and the world. “The deepest well in Saskatchewan we drilled last winter (at 3,530 metres) and this is the deepest horizontal well (5,672 metres) ever drilled. So we’ve kind of got the corner on the market (in record deep wells),’’ says Marcia. More importantly, DEEP has established several firsts in the growing geothermal energy industry. “It’s the first time that there’s ever been a geothermal project that’s been drilled horizontally,’’ says Marcia, a University of Saskatchewan-trained geologist and geoscientist. “It’s the same way you drill for hydrocarbons, but this time without an oil cut. It was a 100-per-cent water well.’’

Marcia said the well, known as Border-5HZ, hit pay dirt—piping hot brine—in the Deadwood Formation, a layer of rocks several thousands of metres deep, which contains a prolific salt-water aquifer lying underneath much of southern Saskatchewan. As the depth of the Deadwood increases, so does the water temperature—by about 30 degrees C. per kilometre—and water pressure. With Border-5HZ hitting water as hot as 127 degrees C and flow capacity of 20,000 cubic metres per day, DEEP had a ‘gusher’ on its hands—and a hot one at that!

“Think of it as heat mining,’’ Marcia says. “Heat is a resource and that geothermal brine is the medium to move that (hot) fluid to the surface. So the more fluid we can move, the more heat we can mine.’’

Now that Border-5HZ has hit the hot water zone, DEEP must demonstrate the well will continue to be a steady producer and consistently hot to support more development. DEEP will spend the next month or two testing the Border-5HZ production well and two injection wells to “refine the reservoir model and finalize subsurface well design and spacing.’’ The objective is to complete a “bankable feasibility study,” which will cost about $8.5 million. Since the fourth quarter of 2018, privately held DEEP has spent just over $38 million on the project, including $11 million of its own money and a $27-million contribution from the federal government.

In total, the first five-megawatt phase of the geothermal project is expected to cost $51 million. “We’re very grateful for that federal funding that allowed us to take the small steps leading into the larger steps and (to) de-risk the project,’’ Marcia says.

Prime Minister Justin Trudeau made the funding announcement on a visit to DEEP’s drilling site near Torquay, about 30 km southwest of Estevan, in January 2019. “DEEP’s project as the potential to transform how the province and the country produces energy, while creating good, middle-class jobs for Canadians,’’ Trudeau said, adding geothermal energy will help meet the federal government’s target of net-zero emissions by 2050.

The drilling and completion of the first production and injection wells is just the beginning of the DEEP geothermal energy project, which will be the first of its kind in Canada.

Once well testing, feasibility studies and detailed engineering are complete, work will begin on turning the hot water into electricity, initially through a temporary 200-400 kilowatt organic rankine cycle (ORC) power generator. ORC units have been used around the world for over 40 years to generate power in any industry that produces heat, including paper mills, cement plants, oil and gas refineries, etc. There are currently four 5 MW ORC units on the Alliance Pipeline providing electricity to SaskPower.

“The field, once it’s fully developed, will produce 20 megawatts,’’ Marcia says. “Six production wells and four injection wells will be required.’’

The projected completion date for the first 20 MW is March 2023. The 20 MW plant would be sufficient to power 20,000 homes. It also prevents 114,000 tonnes of carbon dioxide a year from being emitted—comparable to taking 32,000 vehicles off the road. “That will be the first field. That design is repeatable many times,’’ she says. “We’re working towards five of those fields, all in the same area.’’

The goal is to build about 100 megawatts of power generation from the same area along the U.S. border. “Once we’ve got the first ones installed, we could have the remaining 80 MW installed in about five years.”

So, by 2028, Saskatchewan could have the first, large-scale geothermal energy project in Canada. From there, some experts say the deepest parts of the aquifer in the province could support 200 MW of geothermal power.  “We’re trying to not over-promise and under-deliver with this project. For now, we believe the lowest hanging fruit is where we’re working right now. Hopefully, other areas… can come online as well,’’ Marcia says.

Of course, DEEP needs a customer for that power and, to that end, signed a power purchase agreement (PPA) with SaskPower in May 2017. PPA negotiations are expected to continue into the first quarter of 2021. “DEEP’s geothermal project is still in the preliminary phase,’’ a SaskPower spokesperson said in an email. “We are still waiting to see if certain technical requirements of the power purchase agreement can be met.’’

But Marcia believes geothermal energy has great potential for the province. First of all, it’s green energy, with no carbon emissions, so it will help SaskPower achieve its goal of generating 50 per cent renewable energy by 2030, as well as the federal government’s target of net-zero carbon emissions by 2050.  “The other important thing that geothermal can do is provide baseload power,’’ Marcia adds. “Wind and solar (power) have to be backed up with another energy source. You have to be able to turn on natural gas (generated power) when the wind isn’t blowing. Whereas with geothermal, it goes 24/7.’’

Geothermal energy has yet another advantage for Saskatchewan. With the Deadwood Formation underlying much of the southern portion of the province, the potential for geothermal direct heating is enormous. “It also has the ability to do more than power generation,’’ Marcia adds. “It also can provide direct heating.’’

“In a cold country like Canada, where the average mean temperature is zero degrees (Celsius), anywhere we can get access to inexpensive, clean heat, it can be really attractive.’’ She believes that geothermal energy, whether used for energy production or direct heating, could be a $1-billion industry in southeastern Saskatchewan. While geothermal won’t replace the oil and gas industry in the foreseeable future, it will provide another market for those exploration and development skills, she adds.

“Now that we have the opportunity to move these projects forward, I feel confident that, 10 years from now, we’re going to have a fairly established geothermal energy industry.’’