BP, Chevron Invest in Closed-Loop Geothermal Technology
Calgary-based Eavor Technologies has raised $40 million to build out geothermal systems that use horizontal-drilling technology and may someday give abandoned oil and gas fields a second act.
The race for breakthrough geothermal technologies is heating up. The latest push came this month when the venture arms of BP and Chevron led a $40 million investment round in a startup company called Eavor Technologies.
Calgary-based Eavor (pronounced as “Ever”) is the developer of a closed-loop geothermal system that it says is able to transform the subsurface into “a giant rechargeable battery.” With new funding from the oil majors and others, Eavor’s plan is to scale up and generate enough electricity to power the equivalent of 10 million homes by 2030.
“The involvement of companies such as BP and Chevron represents a fantastic endorsement of our technology, the progress we have made to date and the promise for its global scalability,” John Redfern, president and CEO of Eavor, said in a statement.
Unlike other geothermal processes that rely on pockets of hot water reservoirs to spin a turbine, Eavor uses an approach called low-enthalpy geothermal energy (LEGE) that is fueled only by the heat of the reservoir rocks.
Eavor’s design involves drilling two vertical wells with several multilateral sections that spread out and intersect. A proprietary working fluid is then added at the surface and circulated through a production string without being exposed to the reservoir rock.
LEGE has struggled to gain traction as a viable pathway for energy production since it has historically required a surface pump to keep the fluids circulating—a feature that cannibalizes 50-80% of the energy created.
Eavor says it has overcome this obstacle by eliminating the need for a pump, which has the added benefit of making its system emissions free.
This is possible thanks to the thermosiphon effect which happens as dense cold water goes down one well and pushes the warmer water up to the surface from another well.
With a continuous flow of warm fluid achieved, the thermal energy brought up from the subsurface can be used as a heat source or to generate electricity. Since this approach needs only elevated formation temperatures, and not brine reservoirs, and has a footprint the size of a typical backyard, Eavor said future facilities can be installed pretty much anywhere energy is needed.
Eavor drilled its first wells at a demonstration site in Alberta in the summer of 2019. The small-scale facility was used to prove that it could drill intersecting wells, create a sealed fluid loop, and validate the overall performance of the thermosiphon effect.
In addition to relying on many of the same drilling technologies developed in the oil and gas industry, Eavor’s technology can also be retrofitted to abandoned well sites and to help support the intermittency of other renewable sources of energy.
“We see Eavor’s potential to be complementary to our growing wind and solar portfolios. Our expertise and experience also makes BP well equipped to support Eavor’s growth,” Felipe Arbelaez, BP’s senior vice president zero-carbon energy, said in a statement.
Other investors in the funding round included Temasek, BDC Capital, Eversource, and Vickers Venture Partners.