Yerila-1, which was first due to spud in early June, will be drilled to a depth of up to one kilometre, passing through an artesian aquifer modelled at 620m, and then penetrating into the interpreted Cooper Basin equivalent strata below.

Petratherm has struck a deal with Planet Gas Ltd to provide results of the well and logging program to Planet Gas in exchange for a contribution towards the well cost.

“Temperature gradient data gathered from the geothermal evaluation well will be used to confirm geological and geophysical modelling, which suggests there may be a geothermal resource at a depth of 3.5km,” Petratherm said today.

“Well logs will also measure the physical properties of the overburden and determine the regional stress field, factors that have bearing on the commercial viability of the potential hot rock resource.”

On completion of Yerila-1, the rig will move immediately on to drill test the Paralana geothermal target (GEL 178), 65km south-south-west of Callabonna.

According to Petratherm, the basement granite in this area produces an average of six times the heat by volume of normal granite. Some areas are 25 times hotter.

“This is at least twice as much heat than other radiogenic granites that have been used to generate geothermal power successfully elsewhere in the world,” Petratherm said.

Geophysical data and modelling of the Callabonna Gravity Low, along with historical seismic data, indicates a major sub-basin above the granite in this area, providing an insulating blanket that retains heat in the granite.

“The potential combination of a suitable capping insulator and basement heat engine below means this region may contain vast geothermal energy supplies,” the company said.

Meanwhile, elsewhere in South Australia, Geodynamics’ Cooper Basin hot fractured rocks project has made major progress during the quarter, most demonstrably with the first example of heat extraction from the target hot rocks.

That test took place in front of various media representatives, who saw the company successfully demonstrate geothermal flow and heat extraction.

Diagnostic testing below the Habanero-2 well used for the test showed the presence of a large permeable underground heat exchanger. According to the company’s quarterly report for the period ending June 30, the underground heat exchanger discovery represents “the best news of the project to date”.

Geodynamics Power Systems, a wholly owned subsidiary of Geodynamics, made major advances during the period, gaining official recognition for its Kalina Cycle technology, winning a A$2.1 million Australian government grant and forming a geothermal market alliance with Siemens to tackle the New Zealand market.

The government grant is for the first GPS waste heat power generation project – a 12MW plant under consideration for the Mt Keith nickel mine.

Plans are afoot to secure further government grants. Besides the Greenhouse Gas Abatement Program grant it received for the Mt Keith project, Geodynamics is preparing submissions for a Renewable Energy Development Initiative grant for the development of the 3-5MW commercial demonstration plant and a bid for a A$500 million Low Emission Technology Development Fund grant for the first scale-up commercial geothermal plant of about 40MW.

The company renewed its memorandum of understanding with Santos regarding future power supply and executed a heads of agreement with Origin Energy regarding a power purchase agreement.

The Origin deal gives it the right to purchase up to 50% of the power generated by Geodynamics at a large commercial geothermal power plant in the Cooper Basin, with a nominal 200 MW or more.

Financially, Geodynamics topped up its cash supply with A$19.2 million via a placement through ABN Amro Morgans and a shareholder purchase plan. Those funds are for developing a commercial demonstration plant on its Cooper Basin ground.

The company also shored up its Cooper Basin holdings by its scrip-based purchase of Geothermal Exploration Licence 99 from Scope Energy.

This has allowed Geodynamics to lay claim to controlling all known and delineated geothermal resources in Australia.

Geodynamics’s total expenditure during the quarter was A$4.5 million, leaving the company with a cash position of A$23.8 million.