Title:

Economic Valuation of Directional Wells for EGS Heat Extraction

Authors:

Thomas S. LOWRY, Elena KALININA, Teklu HADGU, Katherine A. KLISE

Key Words:

enhanced geotherm system, levelized cost of electricity, risk, uncertainty, directional, horizontal, GT-Mod, GETEM, FEHM

Conference:

Stanford Geothermal Workshop

Year:

2014

Session:

Enhanced Geothermal Systems

Language:

English

Paper Number:

Lowry

File Size:

1186 KB

View File:

Abstract:

The purpose of this research is to investigate the potential of Enhanced Geothermal Systems (EGS) heat extraction using directional wells. Our previous research demonstrates that the performance of vertical wells is greatly affected by the well separation distance, the thickness of the injection interval, the permeability anisotropy, and fracture properties and orientation. The near-vertical orientation of fractures often found in EGS environments means that vertical wells cannot optimally exploit the geothermal resources. In addition, vertical well performance can be impacted by density differences that cause the colder injected water to sink to the bottom of the injection interval, reducing the long-term thermal performance of the reservoir. The potential of directional well drilling to overcome these problems is being investigated by simulating their thermal and economic performance across a variety of well configurations and EGS environments. This paper/presentation presents the economic performance piece of the investigation (the thermal performance results are being presented by the same authors as a separate paper). In our analysis we use a Fracture Continuum Method (FCM) coupled with the Finite Element Heat and Mass (FEHM) model to perform high-resolution simulations of injection and production well pairs at three different orientations: vertical, 450 inclination, and horizontal. A total of 30 simulations were run by varying the injection interval, reservoir permeability, and fracture orientation with respect to the well-pair plane. The thermal performance of each simulation is used as input to the GT-Mod system dynamics model to simulate the full-system performance and to estimate the levelized cost of electricity (LCOE) over an assumed 30 year project lifespan. The well design specifications and costs were developed for Sandia National Laboratories as part of a separate study by Baker Hughes, Inc. The LCOE is estimated through a dynamic link between GT-Mod and a modified version of the Geothermal Electricity Technology Evaluation Model (GETEM). Results show that the LCOE is 0-10% lower for the directional well orientations as compared to the vertical well orientations due to better thermal performance for the directional orientations and despite the extra expense (the directional configurations of this study were 25% to 100% more expensive than drilling similarly configured vertical wells). In addition, the thermal performance of the directional wells is shown to be less sensitive to geologic uncertainties such as permeability and fracture orientation. Results for each well configuration and geologic scenario combination are presented in the context of risk reduction and uncertainty and analyzed to examine their potential impact on EGS investment and development.


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