Petrologc studies of Lagunao wells show that hydrothermal alteration in the sector is mainly produced by recent neutral-pH fluids. The characteristic alteration assemblage consists of smectite. illitic clays, epidotes associated with chlorite, calcite and quartz. The sulfide mineral phases, on the other hand, are mainly pyrite and chalcopynte with minor covellite/chalcocite, bornite, maclanawite, sphalerite and galena.

Based on the existence of stable hydrothermal alteration, the upflow of hot, neutral-chloride brine in Lagunao is postulated to occur beneath the area
bounded by Ticala Fault in the northwest and Lagunao Fault in the northeast. The outflow regions, on the other hand are the areas northeast of
Lagunao Fault and northwest of Ticala Fault where fluid flow is mainly horizontal and deep such that relict alteration at shallow levels remains extant. The southwestern boundary of the upflow is inferred
to be the Kaipohan Gamay Splay C based on the decreasing trend of isotherms towards LG-2D. Towards the southeast, the Odlumon Fault likely acts as the margin of the neutral upflow since all the aquifers of wells drilled southeast of this structure proved to be acidic.

Acid fluids in Lagunao tapped by wells BL-1D and LG-1D are believed to have deep-seated origins based on a comparison with the results of the petrologc evaluation of Cawayan sector of the Bacon-Manito Geothermal Project, and on the results of sulfur isotope analysis in Palinpinon. The acidlty of the fluids can be attributed to the presence of acidlc gases such as SO2 and H2S exsolved from the cooling magmatic source of the Lagunao dome.

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