Greenlight given to Canada's first large-scale geothermal power plant

DEEP Earth Energy plant in Saskatchewan aims to be online by summer 2024

CALGARY Using drilling techniques more commonly associated with oil extraction, saskatchewan' s DEEP Earth Energy Production Corp. says it will begin construction this year on Canada's first commercial-scale facility for producing electricity from geothermal heat.

The privately held Saskatoon-based company announced Monday that procurement and engineering work has already begun on the first phase of a 25-megawatt power facility in southeast Saskatchewan, close to the U.S. border, which will be supported by a previously announced five-megawatt power purchase agreement with Saskpower – the first geothermal power contract in Canada.

“We're using a highly skilled team and workforce from the oil and gas sector and redeploying those skills and that know-how for the first time ever on a renewable energy project,” DEEP Earth chief executive Kirsten Marcia said in an interview. “We're not taking the stance as a clean energy company that it's us against them.”

Construction and drilling on the first five-megawatt phase will begin in the fourth quarter of this year, with first power production expected by the summer of 2024. The next 20-megawatt segment is not yet fully financed, Marcia said, but once complete, the project will be capable of powering 25,000 households.

The announcement represents a key turning point for Canada's nascent geothermal power industry, which remains underdeveloped despite the country's abundant potential. Geothermal projects are typically more expensive to build than wind or solar, but deliver more reliable, around-the-clock energy.

With geothermal, it is always on 24/7. Once we're up and running, it's always producing power.

“As a consequence, we can attract better contracts than wind or solar,” Marcia said. “Because if you're a utility and you're buying wind, and the wind isn't blowing, you need something else to power your grid. With geothermal, it is always on 24/7. Once we're up and running, it's always producing power.”

DEEP Earth's project will use oilfield-honed horizontal drilling techniques to access geothermal power, with wells drilled to a depth of about 3.5 kilometres and then horizontally for an another three kilometres. Similar well designs are routinely used in oil and gas, but application of these techniques to renewables is new, the company said.

Marcia, who founded the company, trained as a geologist and worked for years in oil and gas and mining before turning her attention to renewable energy. And with Saskatchewan's geothermal potential largely hidden underground, she said the company has relied on decades of publicly available exploratory drilling data from the oil and gas industry to identify potential geothermal hotspots.

Reaching a final investment decision wasn't easy, however, as the company dealt with numerous engineering challenges in designing a facility that wouldn't be at risk of consuming all of the power that it was generating, according to Marcia. During testing, the company also had to find a way to mitigate against the corrosive tendencies of the water it drew from underground reservoirs to the surface for electricity generation, requiring DEEP Earth to use protective coatings in well designs that increased project costs.

But, after 12 years of effort, Marcia said the company is “100 per cent comfortable” in proceeding with construction.

“We believe we've cracked the code for these lower temperature geothermal resources around the world,” Marcia said. “Saskatchewan is not unique in our sedimentary basin... these sedimentary basins are found all over the world with similar geothermal resources. What can get very exciting is if we were able to deploy this technology and our expertise (to) really have a potentially globally transformative impact on the geothermal energy industry.”

DEEP Earth has been working to develop the project since it was founded in 2010. The company began drilling test wells in 2018 and has acquired the subsurface leases to support multiple power facilities capable of more than 200 megawatts of power generation. The company is also exploring the possibility of using some of its subsurface lease for carbon dioxide storage underground.

The project is financed through a mix of private investment and government support including $25.5 million in funding from Natural Resources Canada in 2019.