Geothermal handbook: PlanninG and Financing power Generation t e c h n I c a L r e p o r t 2 / 2

3 | Fluid or Steam Composition |
Even if a geothermal reservoir is proven to exist, fluid and steam may,
in some cases, have a chemical composition that precludes their use for power generation; in contrast, it is
usually possible to find ways to process and use oil even if its chemical composition is problematic. 
4 | reservoir depletion |
Oil can be pumped until the economics of production fall below a set threshold,
or, in the best case, until the reservoir is considered depleted. Geothermal fluids have to be reinjected to
avoid pressure drops. Therefore, groundwater flows and reservoir refill systems have to be understood
to avoid depletion of a geothermal energy resource. However, an orderly maintained geothermal well can
produce steam for decades.
Source | Authors.

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G e o t h e r m a l H a n d b o o k : P l a n n i n g a n d F i n a n c i n g P o w e r G e n e r a t i o n 
At a cost of US$ 2 to 6 million per well, this would translate into an investment of US$ 40 to 120 million, 
or from US$ 0.8 to 2.4 million per megawatt installed, with an average of US$ 1.2 to 1.5 million. In 
most cases, over 50 percent of the total investment for a geothermal power project will be related to 
exploration and drilling. Since it takes about six weeks to drill a normal 2 km deep well, it would take 30 
months to drill the wells for a 50 MW geothermal project with one drilling rig, not considering time for 
rig mobilization and moving. 
In order to speed up the process, it would be necessary to deploy several drilling rigs and to work 
on the surface pipelines, well heads, and other necessary infrastructure simultaneously. However, in 
new geothermal areas it might not be appropriate to speed up drilling, especially early in the drilling 
process. For successful drilling, the location of the next well needs to be based on the results of tests 
from earlier wells. 
Production drilling, as a time-consuming and costly part of any geothermal project, should be based 
on quality project management and supervision by experienced specialists. Delays during the drilling 
phase can seriously affect the financial viability of a project, especially when contracts or the PPA 
contains clauses and deadlines for project completion, commissioning, and delivery of power to the 
grid.