The Geodynamics fund raising of 9.8 million shares at $1.45 per share was oversubscribed. It comprised an equity placement to existing major shareholders with the remainder going to new institutional and sophisticated investors.

The $1.45 issue price represented an 8.8% discount to the weighted average share price for October. Following the issue, Geodynamics now has fully paid issued capital of 85 million shares.

But one of Geodynamics’ main backers – Woodside Petroleum – chose not to take part in the fund raising. Woodside's equity stake in Geodynamics has now declined to less than 20 per cent, leaving Origin Energy as Geodynamics’ biggest stakeholder.

Shares in Geodynamics had been voluntarily suspended before the placement. After resumption of trading they traded down 8.8 per cent to close at $1.56.

Geodynamics said the funds would provide working capital to allow it to complete stage one of its project plan to demonstrate economic heat extraction from hot dry rocks.

This program has three phases – diagnostic phase, the enhancement phase to improve the flow rate of the underground heat exchanger, and the demonstration phase.

The final part of stage one is the reservoir testing program. This is scheduled to commence as soon as Habanero-2 at Innamincka in the South Australian Cooper Basin is completed. Drilling was interrupted when 245m of drill pipe broke off in the well shaft

Rig operations at Habanero are expected to restart on 15 November once all mobilised equipment has arrived at site. Geodynamics expects it will take about 10 days to cut the fish free and prepare the well for recommencement of drilling operations including the sidetrack well. Habanero-2 should reach target depth in the first half of December, according to Geodynamics.

Meanwhile drilling will soon start at another South Australian site as Adelaide-based Petratherm starts exploring for hot rocks at relatively shallow depths.

While Geodynamics’ Innamincka operation involves 4km-deep wells that cost more than $8 million to drill, Petratherm’s target depths are about 3 to 3.5km, chief executive Peter Reid told a South Australian Chamber of Mines and Energy breakfast.

“We want to find shallow hot rocks as close to market as possible,” Reid said.

Petratherm plans to drill exploration shafts at its Paralana geothermal energy prospect, east of Leigh Creek, within the next few weeks. Technology developed by the company and the University of Adelaide lets it use a heat probe in a 600m deep hole to model hot rocks several kilometres below the surface.