Eyeing efficiency, executives at Nabors Industries Ltd. knew years ago that geothermal drilling was a logical step for the company to take, given its large land-based drilling fleet with roughnecks and engineers eager to transfer their skillsets.

“It was a natural progression because we’re in the drilling business,” Joey Husband, senior advisor to Nabors’ Energy Transition Group and the company’s former vice president of global operations, told Hart Energy. “We had the drilling techniques, the automation, the robotics, flow control and automation. That is a natural fit with geothermal.”

The company in recent years partnered with several geothermal startups, including GA Drilling, GeoX, Sage Geosystems and Quaise Energy, looking to advance geothermal drilling technology.

As a renewable energy source seen as a promising route to lower emissions, geothermal energy harnesses heat belowground using wells to drill into reservoirs.

With conventional geothermal, water or steam is produced from wells and then reinjected after the heat is extracted to keep the system operating for long periods of time. The heat extracted can be used to heat or cool homes and buildings via direct use heat or to generate electricity with higher temperature geothermal resources.

“Only 1% of the volume of this planet is colder than 1000 C. So, there is a lot of heat out there,” said Guillermo Sierra, vice president of strategic initiatives, energy transition, for Nabors Industries. “Our ability to get it, efficiently gather it and effectively turn it into power at scale across the planet would be a gamechanger for the renewable energy space.”

Chasing geothermal

Getting to the heat is not so simple.

Temperatures can range from 60 C for shallower depths to 380 C or higher at deeper depths, stretching about 2 to 8 miles beneath the Earth’s surface for most applications today. 

“Drilling to those depths you need to be truly disruptive. It’s just not easy to do. Handling the pressures and the temperatures of deep underground is, again, not easy to do,” Sierra told Hart.

Inadequate water or permeability are among the challenges. Costs also remain high.

The search is on for scalable technologies that enable geothermal energy everywhere, not just near volcanoes. “We think our skills uniquely position to us help these with novel technologies and approaches,” Sierra said.

In the United States, geothermal energy generates only about 3.7 gigawatts (GW) of electricity, according to the U.S. Department of Energy. Analysis shows that could rise to 90 GW by 2050 if developers are able to improve technology and tap the potential of enhanced geothermal systems, which encourage fluid flow using man-made underground reservoirs or other advanced drilling techniques.

Companies known for their focus on oil and gas have moved onto the geothermal scene to make it happen.

“We bring more than just capital. We bring expertise. We bring global footprint. We bring manufacturing capabilities. We bring technology, AI [artificial intelligence], robotics, automation expertise. We bring in global supply chain,” Sierra said.

“We’re trying to create the systems that will allow us to remove those geographical constraints that geothermal has had in the past,” Sierra added.

Nabors is not alone.

‘Hedging technology’

Geothermal energy-focused Criterion Energy Partners is working with Chesapeake Energy Corp. to develop geothermal energy. Chevron Corp. and Baseload Capital have created a joint venture to develop geothermal energy projects in the U.S., starting in Nevada.

Occidental Petroleum and partners are working to lower geothermal drilling costs as part of a project in the Denver-Julesburg Basin. To advance the technology and bring down costs, Baker Hughes teamed up with San Francisco-based GreenFire Energy, a closed-loop geothermal tech company.

Having invested in four geothermal companies, Nabors is examining the potential for the entire geothermal ecosystem, according to Husband.

“We knew that we had to reduce the capital costs of both the wells and the surface plans. We knew there were technologies out there that were targeting superhot rock, let’s say 450 degrees Celsius,” he explained. “So, you still had to drill through some of those formations. But you also had to drill a well and complete it with the right fluids and casing and then produce it at very high temperatures. So, we invested in a company called Geo X.”

While GeoX’s focus is on the technologies in environments producing and maintaining supercritical steam to efficiently extract heat from reservoirs as hot as 450 C, Sage focuses on lower temperatures and extracting power from mid-enthalpy wells in a range of 150 C to 200 C.

Quaise graphic
(Source: Quaise)

GA Drilling targets hard crystalline rock, using a “plasmabit.” The drilling technology allows drillers to destroy rock and remove particles thousands of feet belowground quickly, which cuts costs. Quaise’s technology has the same purpose; however, it uses millimeter wave drilling.

“Both methodologies create intense heat at the bit downhole to be able to remove the rock from the wellbore and enable you to get down and expose the wellbore to very high temperatures where those lithologies exist,” Husband said.

“In a way, we were kind of hedging the technology,” he added,

Making progress

Progress is being made on efforts, as Husband pointed out several milestones have been reached.

SAGE Geosystems, for example, progressed its technique by reentering a single well, converting it into a closed loop and circulating fluids to produce energy.

“They’ve actually proven that their technique can be used on a single well, which reduces the capex because you don’t need multiple wells,” he said, noting Sage is pursuing opportunities involving microgrids. “You can control your working fluid and then you can extract either power directly or store it. The storage piece offers a lot of opportunities to combine with solar, wind or coal plants.”

GeoX has been developing downhole and surface equipment and materials for superhot reservoirs, while Quaise and GA Drilling are integrating machinery and technology into Nabors drilling rigs.

“We’re making very good progress. We don’t have a scaled project yet,” he said. “That would be the next milestone: to scale up some of these concepts and actually get into the commercial electricity production.”

Bigger sustainability push

Geothermal development is only one cog in Nabors’ sustainability and energy transition portfolio. To further diversify its energy footprint, Nabors has also invested in a battery technology company called Natron and Acclima, an emissions monitoring company.

“What’s really cool is that when you start looking at [these technologies], there are different combinations that can be applied,” Husband said. “You’re leveraging the infrastructure, capital, equipment and people to make each one of those electricity plants much more economic.”

Speaking Feb. 8 on the company’s latest earnings call, Nabors CEO Tony Petrello said “our three focus areas include reducing our own environmental footprint, capitalizing on adjacent opportunities and investing strategically in leading edge companies with clear adjacencies to our core activity.”

Nabors’ technology initiatives also include a highline power transformer module called PowerTap, which directly connects rigs to the grid without running gensets, its SmartPOWER Advisory and Control systems, which optimizes engine usage to reduce emissions, and an energy storage system that aims to lower the number of online generators required by combining supercapacitors rather than lithium batteries with the power management system.

“We have expectations for very strong growth from these initiatives in 2023,” said Petrello. “Margins in this portfolio should be highly accretive to the company average over time.”

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