Geodynamics chief executive Bertus de Graaf said Origin would have the right to buy 50 per cent of the electricity produced from a Cooper Basin power station with a capacity of 200 mega watts or more.

De Graaf said this gave Geodynamics the basis of a partnership with a serious power player.

The company has also secured $2.08 million from the federal government to fund a 13 mega watt (MW) Kalina cycle power plant development located at WMC Resources Ltd's Mt Keith nickel mine in Western Australia.

This plant would be the first Australian demonstration of the Kalina cycle power generation system using waste heat from an open cycle gas turbine.

"The Kalina cycle is a highly efficient method of converting medium to low heat into electricity," Dr de Graaf said.

"The source of the heat could be either from industrial waste heat, conventional or HFR geothermal.

"If we are successful in our bid with WMC we will build the new 13MW power plant, own and operate it, giving Geodynamics its first cash flow.

"We can then move to replicating this project to many waste heat and industrial heat applications all over the world."

There are currently only two Kalina cycle plants operating in the world in Japan and Iceland. The company is also bidding for the construction of Kalina geothermal plants in New Zealand in conjunction with Siemens.

Meanwhile, Australia's second hot rocks player, Petratherm, has said its recently awarded $140,000 South Australian Government “Plan For Accelerating Exploration” (PACE) grant would support drilling at its Callabonna prospect.

“Drilling of the Callabonna target will begin in approximately four weeks time,” the company said in a statement.

“The well, to be called Yerila-1, is named after the granite of the same name which outcrops just 40 kilometres south-west of the drilling site and is one of the highest heat producing granites known – over 20 times more than normal granites.”

Yerila-1 will be drilled to a depth of about one kilometre depth, passing through an artesian aquifer modelled at 620 metres, and then penetrating into the interpreted Cooper Basin equivalent strata below. Data collected from the well will enable calculation of inherent stress characteristics and a temperature gradient profile.

On completing the Callabonna program, the rig will be moved to the Paralana-1 site in permit GEL178 to complete the Paralana geothermal evaluation well to 600m.

“Paralana-1 was spudded in mid January but encountered unstable hole conditions and was halted at 306 metres,” Petratherm said.

“The larger capacity rig commissioned for Yerila-1 is rated to 2000 metres, and can drill with a weighted mud system to overcome hole instabilities found at Paralana-1.”

Temperature gradient data gathered from the geothermal evaluation wells at Callabonna and Paralana will be sued to determine whether significant geothermal resources exist at these sites.