HomeMy WebLinkAboutNome Pilgrim Hot Springs Geothermal Feasibility Rpt LorieDilley 04-19-2007 Alaska Energy Authority
PRELIMINARY FEASIBILITY REPORT
Pilgrim Hot Springs
Nome, Alaska
April 19, 2007
Lorie M. Dilley, PE/CPG
Principal Geologist
3335 Arctic Blvd., Ste. 100
Anchorage, AK 99503
Phone: 907.564.2120
Fax: 907.564.2122
TABLE OF CONTENTS
1.0 INTRODUCTION…………………...............................................................1
2.0 BACKGROUND AND GEOTHERMAL RESOURCE
CHARACTERIZATION…………................................................................1
2.1 LOCATION........................................................................................................ 1
2.2 PREVIOUS STUDIES OF PILGRIM SPRINGS AREA.................................... 2
2.3 GEOLOGY......................................................................................................... 2
2.4 HYDROGEOLOGY........................................................................................... 3
2.5 GEOCHEMISTRY............................................................................................. 3
3.0 POWER PLANTS ………………………………………………………………5
4.0 ENERGY EFFICIENCY………………….....................................................5
5.0 ALTERNATIVES………………………………………………………………..6
5.1 ALTERNATIVE 1: SHALLOW SOURCE; UTC SYSTEM ........................................... 7
5.2 ALTERNATIVE 2: DEEP SOURCE; UTC SYSTEM...................................................8
5.3 ALTERNATIVE 3: DEEP SOURCE; TRADITIONAL BINARY PLANT ......................... 8
6.0 CAPITAL COST COMPONENTS..............................................................9
6.1 SITE DEVELOPMENT............................................................................................. 9
5.2 EXPLORATION & CONFIRMATION ...................................................................... 10
5.3 PERMITTING ....................................................................................................... 11
6.4 PRODUCTION WELL DRILLING ........................................................................... 11
6.5 GATHERING SYSTEM/POWER PLANT.................................................................. 12
6.6 TRANSMISSION LINE .......................................................................................... 13
7.0 CONCLUSIONS……………………………………………………………….14
7.1 ALTERNATIVE DISCUSSION ................................................................................ 14
7.2 FOLLOW ON STEPS ............................................................................................ 14
8.0 LIMITATIONS………………………………………………………………….15
9.0 BIBLIOGRAPHY………………………………………………………………16
LIST OF TABLES
Table 1 Program Components and Costs
Table 2 Summary of Alternatives
LIST OF FIGURES
Figure 1A-B Vicinity Maps
Figure 2 Site Map
Figure 3 Area Photos
Figure 4 Geologic Map of Seward Peninsula
Figure 5 Ownership Map
Figure 6 UTC Generator Photo
Figure 7 Drilling Costs
LIST OF APPENDICIES
Appendix A Model Schematics/Order of Magnitude Cost Estimates
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PRELIMINARY FEASIBILITY STUDY
PILGRIM HOT SPRINGS, ALASKA
1.0 INTRODUCTION
This study presents the results of our preliminary feasibility study of Pilgrim Hot Springs,
Alaska. The purpose of this preliminary study was to evaluate the previous scientific
studies conducted in the area and to indicate the feasibility of developing Pilgrim Hot
Springs into an active geothermal resource. Alternatives were developed as to the
power plant type and geothermal well requirements. A decision matrix, the benefits and
faults, and order of magnitude costs are provided for each alternative. This report is
based entirely on the literature review conducted and no field studies or additional
evaluation of the geothermal resource has been conducted. This is a preliminary study
to indicate the potential feasibility of developing Pilgrim Hot Springs into an active
geothermal resource for power generation.
2.0 BACKGROUND AND GEOTHERMAL
RESOURCE CHARACTERIZATION
2.1 LOCATION
Pilgrim Hot Springs is located on the Seward Peninsula, Alaska, approximately 60 road
miles north of Nome and 80 miles south of the Arctic Circle. The area is located at
Latitude 65° 06’ N, Longitude 164° 55’ W. Vicinity maps are presented in Figures 1A
and 1B, a site map in Figure 2, and photos of the area in Figure 3. The area is
accessible by air via a small landing strip. A 7.5 mile rugged dirt road leading off from
MP 53 of the Nome-Taylor Road accesses the area. Pilgrim Hot Springs stands out as
an approximately two square mile “thawed zone”; an area of warm soil, dense
underbrush and tall cottonwoods seemingly out of place within the harsh conditions of
frozen soil and stunted vegetation in the surrounding subarctic tundra.
Pilgrim Hot Springs lies in an area of low relief in the wide flat valley of the Pilgrim River,
which meanders generally east to west approximately a half mile to the north. Figure 2
presents a site map. Pilgrim River is a tributary of the Kuzitrin River to the north.
Several low flowing springs and seeps flow into the Pilgrim River from the underlying
alluvial sands and silts. Water temperature near the springs ranges from 145° to 160° F
(63° to 71° C). In 1918-19, a worldwide pandemic f lu epidemic struck Mary’s Igloo and
Pilgrim Hot Springs area and killed every Alaska native adult and a majority of the
children living there. Most of the surviving orphans were raised by the Catholic Jesuit
priests and Ursuline nuns at the orphanage constructed at Pilgrim Hot Springs. The
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children and grandchildren (approximately 150 descendants) now comprise the tribe of
Mary’s Igloo, a federally recognized Alaska Native Tribe. They were moved to
surrounding villages when the children’s orphanage closed in the 1930’s.
The surface ownership of Pilgrim Hot Springs is in the Catholic Church, which has
leased the area to Pilgrim Springs Limited. It is our understanding that Mary’s Igloo
Native Corporation (MINC) owns the surrounding area and the subsurface rights (see
Figure 4). Currently there is a caretaker on the property and occasional visitors.
2.2 PREVIOUS STUDIES OF PILGRIM SPRINGS AREA
The most recent and comprehensive investigation of the geothermal characteristics of
Pilgrim Springs was a cooperative investigation begun in 1979 by the State of Alaska,
Geophysical Institute of the University of Alaska and Woodward Clyde Consultants
(WCC). The study, done in two phases and completed in 1982, included the drilling of
six test wells to depths between 150 and 1001 feet. In addition, surveys of soil helium
and mercury, gravity, and electrical resistivity; surficial geology and bedrock mapping,
seismic refraction, geomagnetic profiling, shallow thermal conductivity measurements,
hydrologic measurements, and geochemistry analysis were undertaken.
While this program was able to confirm a significant geothermal resource at Pilgrim
Springs, the exact location, depth, and characteristics of the source of the geothermal
activity remains to be identified.
2.3 GEOLOGY
The Kigluaik Fault, a range-front fault trending east-west several miles to the south,
separates the northern edge of the Kigluaik Mountains from the down-dropped (graben)
Pilgrim River valley (Figures 1A and 1B). This seismically-active fault has experienced
displacement within the past 10,000 years. These mountains, rising to elevations of
generally 3500-4000 feet, are composed of various metamorphic rocks of Precambrian
age, including granitic gneisses and amphibolites. A remnant of similar Precambrian
metamorphic rock outcrops several miles north of Pilgrim Springs in the Hen and
Chicken Mountains. Local Cretaceous intrusives consisting of biotite granite and
diabase are found in a belt from the Seward Peninsula to the Kobuk valley; geothermal
springs in this belt appear to be associated with these intrusive plutons. Geologic
mapping indicates a number of north trending faults, with one projected underneath the
Pilgrim valley fill approximately 1.5 miles east of Pilgrim Springs.
Based on seismic and gravity surveys, the Pilgrim River valley is filled with sediments at
least 1500 feet thick. Surface soils consist of alluvium deposits of the Pilgrim River. A
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vicinity map showing the topographical features surrounding Pilgrim Springs is
presented in Figure 1B, and a geologic map of the Seward Peninsula is presented in
Figure 4.
2.4 HYDROGEOLOGY
Much of Northwest Alaska is underlain by permafrost. Severe winter temperatures
maintain permafrost at shallow depths below the surface. This permafrost impedes both
the downward and the lateral movement of water, so that most precipitation runs off as
surface water. Pilgrim Springs is located in the wide lower end of a drainage system
which drains the Kigluaik Mountains to the south and the western end of the Bendeleben
Mountains. Both the Pilgrim and Kuzitrin Rivers flow sluggishly across meandering
floodplains at a very low gradient, through a poorly-drained lowland studded with ponds,
lakes and swampy flats with elevations generally less than 25 feet above sea level. The
rivers flow north into the Imuruk Basin, eventually draining out through Grantley Harbor
and Port Clarence into the Bering Sea.
The extent and thickness of the permafrost in the region has been adequately
determined in the past using resistivity surveys and Landsat imagery (Forbes, 1979);
however, further investigation of surface temperature profiles using a temperature probe
and thermister is necessary. The area of warm thawed soil in the vicinity has been
estimated in size from 20 to 30 acres (HLA, 1974) to 0.7 square miles (WCC, 1983) to 2
square miles.
Six wells were installed by WCC in 1982 ranging in depth from 150 to 1001 feet. They
were clustered in the hottest part of the anomaly approximately ¼ mile southwest of the
historic Pilgrim Springs Church; see Figure 2. One well was located on MINC property.
Flow rates for the wells ranged from 30 to 250 gallons per minute. All six wells
penetrated an extensive shallow geothermal system, having fluid temperatures of 1940 F
(900 C), were under artesian pressure of six feet above the land surface, and appeared
to feed the surface springs and seeps in the local vicinity of Pilgrim Springs, principally to
the southwest of the church. Temperature profiles of the two deepest drill holes indicate
the thermal gradient of sediments below the surficial groundwater zone to be increasing
about 40 F (2.20 C) per 100 feet of depth.
2.5 GEOCHEMISTRY
Pilgrim Springs can be characterized as an alkali-chloride spring, a type often associated
with areas of recent volcanism. Saline waters can also be associated with Tertiary
sedimentary rocks, which may compose some of the extensive depth of fill in the Pilgrim
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River valley. Warm brine (NaCl) water has been reported from other wells penetrating
Tertiary sediments around Kotzebue and another location on the Seward Peninsula.
Geochemical analysis of Pilgrim Springs was undertaken by the Alaska Division of
Geological and Geophysical Surveys, on samples taken from the six wells. In general,
water from wells PS-1 and PS-2 was hot 198-2050 F (92-96°C), high in dissolved solids,
low in salinity, and low pH. Well MI-1, which is tapping water that lies below the shallow
thermal aquifer, is cooler 750 F (24°C), low in dissolved solids and salinity, and has high
pH.
Available geochemical data of Pilgrim Spring’s exploration wells and springs imply
contradictory evidence of a deep, but diluted thermal fluid and a more saline, shallow
aquifer. Geothermometry of waters indicate maximum deepwell temperatures (Fournier,
1981) of 2660F (~130ºC) yet these values are not consistent with the mixing curves
provided by the existing major chemistry.
Despite extensive exploration in the Pilgrim Spring’s valley by previous researchers,
“neither the heat source nor the water source of the circulating geothermal system have
been identified (Lofgren, 1983).” Deep drilling (Well PS-5) into the intersection of two
high angle faults propagating through the Pilgrim Spring’s property was unsuccessful in
identifying a conduit connecting deeper thermal waters with the shallow artesian aquifer,
yet the resulting temperature profile confirmed the possibility for high temperature
thermal waters 2480 F (120+ ºC) at depths greater than 2600 feet. However, testimony
of past researchers implies additional grounds for locating such a structural conduit.
Economides (1982) and Wescott (1981) agreed that a thermal aquifer containing fluids
of 3000 F (150ºC) at 4,800 feet depth are supplying heat to the surface waters near the
present-day well field. Forbes (1979) however recommended further investigation 2
miles to the northeast along the thawed fault-bounded foothills of Hen & Chickens
Mountain.
A geothermal reservoir is dependent upon the hydrology of the reservoir and the heat
balance. The conceptual geothermal reservoir model developed by WCC, 1982 was
developed considering the inflow and outflow of fluids and heat into an idealized
reservoir area. The model indicates that there could be a continuous supply of 19 to 24
megawatts (MW) of geothermal energy fed into the reservoir from some yet unidentified
source. The 19 to 24 MW of energy fed into the reservoir is balanced by outflow from
the reservoir of 6 MW to the atmosphere, 2 MW to the thermal springs, and 11 to 16 MW
into the groundwater. A 20-year supply of energy at a use rate of 1.5 MW is believed
stored in the shallow thermal aquifer system. More than 90 percent of the resource
available is from the as of yet unidentified source. The useable part of the resource is
estimated to be 13 to 18 MW or the energy in the thermal springs and the groundwater.
This is prior to any energy conversion into power production.
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3.0 POWER PLANTS
Corresponding to progressively lower resource temperature, geothermal energy is used
for electric power generation, direct heating and geothermal heat pumps. Two main
types of geothermal systems are utilized for electric power generation: steam dominated
and hot water systems. Steam dominated systems have pure high temperature steam
that is greater than 455ºF (235ºC) and typically have production wells 3,000 to 13,000
feet in depth. The steam is brought to the surface and it is used directly to spin the
generators to create electricity. Hot water geothermal systems in production have a
typical temperature range of 300 to 570ºF (150-300ºC) (DOE 2003). A flash steam
power plant is most common in these systems. The geothermal fluids are brought to the
surface through production wells as deep as 13,000 feet. They are highly pressurized;
up to 40 percent of the water flashes or in a series of steps boils explosively and turns to
steam. The steam is then separated and is fed to the turbine generator unit directly to
produce electricity.
For hot water systems with lower temperature reservoirs, those between approximately
255ºF and 430ºF (125ºC and 225ºC) a binary cycle power plant instead of a flash steam
plant is required. In the binary cycle plant the geothermal waters are passed through a
heat exchanger to heat a secondary working fluid that vaporizes and that vapor is then
used to turn the turbines.
United Technologies Corporation (UTC) has developed a binary geothermal power plant
currently operational at Chena Hot Springs which produces power from even lower
temperature fluids. A reverse-engineered refrigeration unit is used as the binary plant
and only requires a 100ºF (38ºC) temperature differential between heat source and sink
to generate power. At Chena Hot Springs, this differential is achieved by using 164ºF
(73ºC) water from the geothermal wells and 40 to 45ºF (4 to 7ºC) water from a local cold
water source. This system is currently only produced by UTC and hereafter will be
referred to as the UTC system. See Figure 5 for a photo of a UTC system at Chena Hot
Springs.
4.0 ENERGY EFFICIENCY
Based on the conceptual model there is approximately 13 to18 MW of energy available
prior to power production. The amount of energy that can be produced is based upon
the energy available at the well heads, losses in the hot water delivery system, and the
efficiency of the generators. Losses in the transmission line to Nome would also impact
the amount of power that reaches the customer. The energy available at the well heads
is based upon the flow rate and the temperature of the fluid. Table 1 provides an
estimate of well productivity or the amount of energy available per reservoir temperature.
For the low temperature source (90 ºC) the energy available is approximately 0.4 MW
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per well. For the higher temperature source (150 ºC) the energy available is
approximately 2.5 MW per well. Flow rates for each alternative to produce 5 MW of
power are presented in Section 5.0 for each alternative.
One of the most important concepts about the operation of a power plant is that the
efficiency of the process is determined by the temperature difference between the boiler
and the condenser. In a conventional fossil fuel power plant the temperature of the
steam leaving the boiler may be 1,000 ºF and the condenser may operate at 100 ºF.
Theoretical efficiency of the cycle is about 60 percent. Due to losses in equipment, heat
transfer processes, the actual efficiency might be on the order of 40 percent. In addition,
boiler, combustion, and generator all have efficiencies less than 100 percent therefore a
traditional fossil fuel power plant operates at about 30 to 35 percent efficiency.
Geothermal resources produce temperatures far less than those of a traditional fossil
fuel plant. Geothermal power plants conversion efficiency of heat to electricity is
generally less than 10 percent (Rafferty, 2000). This impacts the feasibility of producing
geothermal power by increasing the quantity of heat needed thereby increasing costs for
resource development. Furthermore the higher heat requires more waste heat requiring
more cooling and therefore a larger parasitic load on the plant.
In binary plants, discussed in Section 3.0, the temperature of the vapor leaving the boiler
is always less than the temperature of the geothermal fluid. Binary power plant
efficiency is based the entering temperature of the geothermal fluid and the leaving
temperature of the fluid. Most plants are capable of achieving leaving geothermal water
temperatures of approximately 160 ºF (70ºC). By knowing the plant efficiency and the
resource temperature, the quantity of water flow required can be determined. Given the
reservoir temperature of 300ºF (150ºC) and assumed plant efficiency of 10 percent, the
required geothermal water flow is about 2,400 gallons per minute (gpm) for a 5 MW
plant. The calculation conducted to determine flow for a given plant efficiency and
reservoir temperature breaks down below a temperature of about 200ºF (95ºC) and
therefore does not work for the shallow source identified at Pilgrim Springs.
5.0 ALTERNATIVES
Given the identified shallow source of geothermal fluids at Pilgrim Hot Springs near
195ºF (90ºC), and the presumed deeper source of up to 300ºF (150ºC) geothermal
water, we modeled three possible alternatives to generate electricity. Because of the
relatively cool temperatures of the two possible sources, we considered options using
either the UTC system or a traditional binary power plant. If the lower, hotter reservoir
exists, the temperatures are believe to range from 250ºF to 300ºF (120ºC to 150ºC)
which is too cool for a flash steam power plant. The alternatives modeled in this report
are as follows:
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Alternative 1: Shallow Source; UTC System.
Alternative 2: Deep Source; UTC System.
Alternative 3: Deep Source; Binary Plant.
For each alternative, we assumed that there was a developable resource able to
produce 5 MW of electricity, which needs to be proven by drilling. Because so little is
known about the nature of the resource, including total size, or the sustainable flow rates
of the geothermal fluids, this assumption may prove to be either much lower or higher
than the real potential of the resource. This can only be verified by more onsite
investigation of the resource. A resource capable of producing 5 MW’s may be more
likely to hold for the deep, higher temperature, geothermal source. The current peak
power needs of Nome are in the neighborhood of 5 MW , and they are projected to
exceed this by around 9 MW with the Rock Creek Gold Mine on line.
Table 1 presents components and costs associated with confirming the existence of the
geothermal reservoir. Table 2 presents a summary of the alternatives. The order of
magnitude cost estimates for each alternative are based on a completed 5 MW capacity
power plant, with enough geothermal wells drilled for supplying the necessary fluids and
providing for reinjection wells in order to maintain reservoir pressures. Schematic
diagrams of the alternatives are presented in Appendix A, Figures A1 – A3. The cost
estimates are an order of magnitude costs and should only be used to compare costs
between the alternatives and as an assessment of the feasibility of the models, should
further research prove out the resource. Further analysis of the components of the cost
estimates follow in Section 5.
5.1 Alternative 1: Shallow Source; UTC System
In this alternative we modelled tapping the shallow, 195ºF (90ºC) geothermal waters.
This temperature is well suited to the temperature differential utilized in a Chena Hot
Springs-style UTC system; assuming cooling is achieved by winter air or local, cold
stream waters used in the power plant. The Pilgrim River runs nearby, and would
provide the necessary cooling water. We assume a depth of 500 feet below the surface
for wells utilizing this source.
According to Chena Power, LLC, a flow rate of approximately 1200 gallons per minute
(gpm) would be necessary to generate 1 MW with the assumed 195ºF (90ºC) fluid. For
the 5 MW, a flow rate of about 6,000 gpm would be necessary. The efficiency of the
larger 5 MW system may require additional flow, which is unknown at this time. If the
attainable flow rate for each well was near 300 gpm, approximately 20 production wells
would be necessary. Simple calculations based on fluid temperature (Hanse, 2005) give
a productivity of 0.4 MW per well (see Table 1). This calculation results in 13 wells
necessary to generate 5 MW of power. The number of wells with this low-temperature
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resource was set at between 13 to 20 wells. This number of wells may be unfeasible in
such a small area, leading to well interference among other problems. At least one
reinjection well, and likely more, would be necessary to maintain the pressure and fluid
flow within the reservoir.
The existing UTC power plant technology as utilized at Chena takes advantage of a
temperature range very similar to that found in the shallow resource at Pilgrim. The
geothermal waters utilized at Chena are 164ºF (73ºC), and the cooling river waters are
40ºF (4ºC). The generators at Chena are 200 KW units. Twenty-five of these units
would be required to produce 5 MW. UTC is reported to be developing a 1 MW
generator, in which case this rather unwieldy number of generators would be cut to 5.
5.2 Alternative 2: Deep Source; UTC System
In this alternative we consider the as yet to be determined deeper, hotter, geothermal
source. We model this source using the 300ºF (150ºC) fluid temperature and well
depths at 5000 feet below the ground surface. Alternative 2 investigates the costs
associated with using a UTC power plant with this source. According to Chena Power
LLC, the flow rate of geothermal fluids necessary to generate 1 MW at this temperature
is approximately 350 gpm, much lower than the preceding alternative. Using an
assumed plant efficiency of 10 percent, we calculated the flow rate at about 480 gpm per
1 MW. Therefore to produce 5 MW of electricity the geothermal fluid flow rate would be
between 1,750 to 2,400 gpm. Drillhole productivity calculations from Table 1 indicated
each well in this alternative would produce about 2.5 MW. For the anticipated 5 MW, 2
wells would be needed. However, based on the high flow rates needed 3 wells may be
necessary. For this alternative we have assumed 2 to 3 production wells would be
necessary.
The existing UTC technology would have to be modified to take advantage of this higher
temperature source. The larger temperature differential would at least require a different
secondary fluid to maximize the efficiency of power generation. Assuming this
technological problem is adequately solved, the greater temperature differential should
help increase the power available, perhaps lowering the cost per MW.
5.3 Alternative 3: Deep Source; Traditional Binary Plant
In this alternative we again consider the inferred deeper, hotter, geothermal source. We
modeled this source assuming 300ºF (150ºC) fluids at 5000 feet depth below the ground
surface. Alternative 3 investigates the costs associated with using a traditional binary
power plant. As with Alternative 2 above, calculations in Table 1 give us roughly 2.5 MW
per well, necessitating 2 wells to produce 5 MW. Flow rates would be similar to those in
Alternative 2 therefore we have assumed 2 to 3 wells would be needed to achieve the
necessary flow rates at the assumed plant efficiency of 10 percent.
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The temperature of this source is in the range of fluid temperatures that have proved to
be economically exploitable by traditional binary power plants. Ormat is a major supplier
of this type of power plant with generators in the 5 MW range.
6.0 CAPITAL COST COMPONENTS
Presented are the components of the capital cost for the alternatives dicussed. All costs
detailed are order of magnitude only. Summaries of these costs are found on the
schematics of the alternatives in Figures A1 through A3 in Appendix A and in Table 2. All
costs are based on 2008 construction with no inflation. The large capital costs required
for these types of projects necessarily involve borrowing money and long delays in
construction can add significant costs to any of the projects. The components
considered were the following:
· Site Development
· Exploration & Confirmation
· Permitting
· Production Well Drilling
· Power Plant and Gathering System
· Transmission Line
For the geothermal components such as exploration and confirmation, and well drilling,
we relied on calculations in Table 1 developed by Hanse, 2005. Site development and
transmission line costs were developed based on experience of local engineers, the new
Nome Power Plant, and contacting suppliers. Power plant costs were based on Hanse
and quotes from suppliers of the power plants.
6.1 Site Development
Site development would include upgrading the gravel access road and developing an
area for the power plant site and well pads.
An existing, approximately 7.5-mile, 4-wheel drive road that connects the Nome-Taylor
Highway to Pilgrim Springs would need to be upgraded to provide access for drill rigs
and other equipment (see photo in Figure 3). The last 200 yards of this road is
especially swampy and difficult for vehicles according to the on-site caretaker. Costs for
this improvement will depend on a number of factors, including number and type of
stream crossings necessary, size and adequacy of existing road section, availability and
grading of local materials, subsurface conditions at the site, etc. For our cost analysis
we assume that the current 4-wheel drive road is approximately 16 feet wide and has a
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2-foot thick section and will be upgraded to 24 feet wide and 3-foot thick section. We
assume that adequate gravel will be available from quarries near Nome. Bid tab
estimates were used plus additional increase in the cost for hauling material to Pilgrim,
we estimated approximately $40 to $80 per cubic yard for gravel. These numbers are
on the low end for rural Alaska projects, but Nome generally has a reasonably available
source of gravel from local mining operations. We further assume that two stream
crossings will be necessary, and that these will be provided by road culverts at
approximately $200,000 per crossing. This gives a total range for the road upgrade of
about 3 to 5 million dollars (M$).
Based on the new Nome Power Plant size and scaling for the size and number of
generators that would be used at Pilgrim we estimated a building size of about 15,000
square feet. Pad development for the power plant will be on the order of $250,000 to
$500,000 assuming a 15,000 square foot building and cost for gravel of $40 to $80 per
cubic yard. Well sites and additional upgrades to on-site roads will probably add an
additional $250,000 to $400,000 in gravel to the project. Site development would add an
additional 0.5 to 1 M$. This assumes that the power plant would not need a specialize
foundation. The new Nome Power Plant needed a specialize foundation with a cost of
about 1 to 1.2 M$ for the foundation alone.
5.2 Exploration & Confirmation
The exploration phase consists of investigating the geothermal resource, beginning with
prospecting and field analysis, and ending with the drilling of the first full-scale
commercial production well. Some of this work has already been accomplished. For
example, a full regional reconnaissance is not necessary as the focus has already been
narrowed to the region of apparent geothermal activity at Pilgrim. Some district
exploration has already been accomplished in the 1979 study of Pilgrim Springs.
However, much work does remain to be done to characterize reservoir morphology, flow
rates and temperature for both the shallow and deep resource. It is expected that
exploration of the shallow resource, (though it may be less likely to satisfy the power
generating needs of Nome) would be less costly due to being nearer the surface and
better characterized at this time than the deeper source. According to Hanse (2005),
exploration costs typically run in the range of $100 to $200/kW depending on the nature
and size of the project, the amount of information already available, and the technologies
employed in exploration.
Factors affecting drilling costs also greatly influence exploration. The size of drill rig will
also affect the drilling costs. For the proposed shallow wells, a shallow gas drill rig may
may be preferred to a large oil drill rig. The shallow gas drill rigs are capable of drilling
depths on the order of 3,000 feet and are transported on a single, heavy duty truck.
Support trucks are used for carrying supplies, mud tanks, and some associated gear
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however the drilling footprint is much smaller than the large oil drill rigs. The deeper
depth of 5,000 feet is near the cut off for some of the more advanced shallow drill rigs
and it may still be possible to use this type of drill rig for this depth. Currently, drilling
costs are expected to be high because of the high cost of oil and the high demand for
rigs for petroleum exploration projects. Figure 7 presents drilling costs of oil and gas
wells in 2003. The costs for the shallower depths use the smaller drill rigs. If one
doubles these numbers to account for the current (2007) level of exploration, and then
doubles the cost again as a rough “Alaska factor” to try to compensate for remoteness,
a range of about 0.8 to 2 M$ per well results.
Confirmation costs are those costs necessary to confirm 25 percent of the total project
capacity. Table 1 provides the costs for administration, unsuccessful drill holes,
regulatory compliance for exploration drilling, reporting documents, and well testing.
These costs are needed to confirm a geothermal reservoir prior to production drilling. If
the costs from Table 1 are added up for the two sources and multiplied by an Alaska
factor of 2, this gives a low-end total confirmation cost of around 5 M$ for the shallow
resource and 9 M$ for the deeper resource. If we double these numbers again to give a
rough estimate to the high end of the expected range (to allow mainly for more
expensive drilling costs due to the competition for drilling equipment with the petroleum
industry, etc.), and add on the range above for the exploration costs we get the numbers
listed on Figures A1 through A3 for the costs of exploration and confirmation of 7 to 14
M$ for the shallow resource and 11 to 22 M$ for the deeper resource. This is the range
of costs needed to confirm that the resource is actually there.
5.3 Permitting
Permitting costs are necessary for compliance with state and federal regulations. Hanse
gives a range of typical project costs for permitting of from about 0.2 M$ with a
completion time for permitting of less than a year (best case scenario) to over 1 M$ with
a permitting time of over 3 years, mostly depending on the stringency of local
regulations. Air permitting on the Nome Power Plant was extensive and required two
years of monitoring data before permitting would take place. However geothermal
power plants generally have better air quality than traditional fossil fuel plants and
therefore air permitting will probably be less rigorous. Additional permitting issues may
arise particularly with transmission lines and migratory birds as well as discharge of
waters into the surrounding environment. These costs are included into the Exploration
and Confirmation costs on Figures A1 through A3 of Appendix A.
6.4 Production Well Drilling
Although some well drilling is included above in costs to confirm the resource, additional
wells would need to be drilled to complete the development of the resource to 5 MW.
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April 2007 Page 12
Drilling costs are affected by depth of hole, availability of equipment, how well the
resource is characterized, temperature, chemistry and permeability of the resource, and
cost of construction materials, among other factors. A little over half of the drilling costs
are explained solely by the depth of the well. Assuming the brine in this resource is not
corrosive and given that the relatively low temperatures of these resources should not
result in high pressure, the drilling conditions at Pilgrim should not be unduly adverse.
One method for assessing base cost for drilling each well is that given by Table 1. This
value is significantly higher, however, than drilling costs averaged from onshore oil and
gas drilling (Augustin, 2006), see Figure 7. Either of these costs must be multiplied by
an “Alaska Factor” to take local conditions and remoteness into account, as well as
availability and cost of drilling equipment in the current market.
The number of wells that need to be drilled depends most strongly on the productive
capacity of each well, which has been estimated in Section 4.0. The success rate of
holes drilled during this phase is in the range of 80 percent. It is strongly recommended
to drill at least one extra production well during this phase to help offset the common
occurrence of well productivity decline. Reinjection wells will also be necessary to
maintain the resource.
Taking all of these factors into account, a range for the cost of drilling is around 4 to 8
M$ for the shallow resource and 5.5 to 11 M$ for the deep source, keeping in mind that
25 percent of the production capacity for the shallow resource and 33 percent of the
production capacity for the deep resource was developed in the confirmation phase.
Competition for drilling services from the oil and gas industry could drive these figures up
even higher.
6.5 Gathering System/Power Plant
In costs for the power plant we include costs for the generators and generator building
and pumps and piping to bring the geothermal fluids to the generators.
The hot water gathering system includes the pipes and pumps. Under a reasonable
assumption that our geothermal fluids are not too highly corrosive, we can start with the
industry average of around $250 per kW from Hanse(2005), which gives about 1 M$ for
a 5 MW project. Doubling this for the Alaska factor, one obtains a range of roughly 1 to
2 M$. The number of pipes necessary to develop the shallow resource will undoubtedly
be greater, as we require a greater number of wells in our model.
At the new Nome Power Plant, a traditional fossil fuel plant, building costs were on the
order of 5 to 7 M$, with the final project costs approaching 30 M$. Geothermal power
plant costs include the cost of land, and physical plant, including buildings and power-
generating turbines. Geothermal plants are relatively capital-intensive, with low variable
Alaska Energy Authority Preliminary Feasibility Study
HDL 07-301 Pilgrim Hot Springs, Alaska
April 2007 Page 13
costs and no fuel costs. Plant lifetimes are typically 30–45 years. Financing is often
structured such that the project pays back its capital costs in the first 15 years. Costs
then fall by 50–70%, to cover just operations and maintenance for the remaining 15–30
years that the facility operates. In the case of the traditional binary power plant, we use
numbers from Hanse, multiplied by a factor of 2 (“Alaska Factor”) to estimate a range of
from 23 M$ to 30 M$ for a 5 MW power plant, assuming a resource temperature of
150ºC. According to the Renewable Energy Policy Project (REPP) in Washington DC,
capital cost for geothermal power plants in the 5 MW range using a medium quality
resource ranges from $1600 to $2400 per installed kW. Applying a factor of 2 for the
remoteness of the project, construction cycles and Alaska weather the REPP numbers
are in the same range as Hanse.
Chena Power, LLC gives a cost of $1300 per KW for the UTC generators. Based on
conversations with Chena Power, LLC, this cost is expected to hold for the currently
produced 200 kW generators and the 1 MW generators they are developing. Shipping
for the 200 kW generator to Chena Hot Springs was around $50 per kW. We also
assume the construction of a 15,000 square foot building to house the generators,
shops, and apartment space at around $350 to $500 per square foot. Using these
values we get a cost of roughly 12 to 17 M$ for the UTC plant.
6.6 Transmission Line
To bring the power produced to Nome, approximately 60 miles of transmission line
would be necessary. For a single pole structure, Dryden and LaRue (personal
communication) provided a rough estimate of $500,000 to $750,000 per mile. This
assumes winter construction for tundra protection, and further assumes that topography
is gentle along the path of the transmission line. This gives a total cost of between 30 to
45 M$. Hanse reports costs for construction lines of from $164,000 to $450,000 per
mile, doubling these numbers for the Alaska Factor we get a total of around 20 M$ to 54
M$. We take a middle range to be a reasonable rough cost estimate, and assume
transmission costs to be approximately 20 M$ to 45 M$.
Alaska Energy Authority Preliminary Feasibility Study
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April 2007 Page 14
7.0 CONCLUSIONS
7.1 Alternative Discussion
The following presents a summary of the alternatives and associated costs.
PROJECT
ALTERNATIVE COSTS ($M)
1. Shallow Source; UTC System 48 - 92
2. Deep Source; UTC System 54 - 103
3. Deep Source; Binary Plant 64 - 116
Based on cost alone, it seems that Alternative 1 would be the preferred alternative. It is
possible that this alternative would not produce 5 MW. We do not know the total
capacity of either resource for power generation. It is more plausible that the inferred
deeper source would be able to generate power in the range of 5 MW. The shear
number of wells and generators needed to generate power may also preclude the use of
the UTC system. Well interference may also be a major problem with Alternative 1.
Alternatives 2 and 3 utilize a source, that while less well characterized than the shallow
source, has greater theoretical potential for power generation due to its higher inferred
temperature (150ºC vs 90ºC) and potentially greater heat capacity. Using a UTC system
may have cost advantages because of the small size of the plant and relatively low
temperature of the source. However, the UTC system currently utilized in geothermal
setting at Chena Hot Springs runs off of a lower temperature source and the
technological problems of working with the hotter fluid at Pilgrim will need to be
overcome. This may delay the time until a working plant is available, thus raising the
cost.
Although projected to be slightly more expensive than the other options, Alternative 3 at
this time seems to be the option most likely to succeed. Prior to more research into the
characteristics of the resource, this appears to be the best option. If the deeper
resource proves to have greater than 5 MW capacity then the cost per megawatt will
decrease. Many of the costs are fixed and therefore additional power capacity beyond
the 5 MW would provide a lower cost per megawatt which could benefit the mine coming
on line.
7.2 Follow On Steps
At this time neither of the resources has been confirmed. The shallow source has been
identified however its full character has not been confirmed. The deep source is only
known through limited geochemistry and modeling the shallow source. An exploration
Alaska Energy Authority Preliminary Feasibility Study
HDL 07-301 Pilgrim Hot Springs, Alaska
April 2007 Page 15
followed by a confirmation phase needs to be conducted prior to any decisions about
type of power plant and number of wells.
We would recommend that the exploratory phase focuses initially on both the shallow
and the deep source. A better characterization of each would help immensely in refining
the feasibility estimates of the available options. We would recommend the following for
assessing the resources:
1. Identifying the regional thermal and hydrologic gradient;
2. Repeat equilibrium temperature profiles for existing wells;
3. Accurately and uniformly characterize the chemistry of the well, spring and river
waters;
4. Complete mapping of regional geothermal system;
5. Characterizing regional aqueous geochemistry; and
6. Quantifying thermal budget and environmental impacts.
In addition to these items, a conceptual model of the shallow and deep geothermal
reservoirs with our improved understanding of structurally controlled geothermal systems
should be developed.
Based on the exploratory phase one or both of the sources will be identified and a more
thorough understanding of the sources will be achieved. After the exploratory phase a
decision can be made as to which source to pursue and a confirmation phase can begin.
The costs associated with exploratory and confirmation phases including the drilling of
test holes and well tests is on the order of 7 to 22 M$.
8.0 LIMITATIONS
If substantial time has elapsed between submission of this report and the start of work at
the site, or if conditions have changed because of natural causes or construction
operations at or adjacent to the site, we recommend that this report be reviewed to
determine the applicability of the conclusions and recommendations considering the time
lapse or changed conditions.
Prepared By: Reviewed By:
Hattenburg Dilley & Linnell Hattenburg Dilley & Linnell
Michelle Wilber Lorie M. Dilley, PE/CPG
Staff Geologist Principal Geologist
Alaska Energy Authority Preliminary Feasibility Study
HDL 07-301 Pilgrim Hot Springs, Alaska
April 2007 Page 16
9.0 BIBLIOGRAPHY
Economides, M.J., Economides, C.E., Kunza, J.F., and Lofgren, B.E. (1982) A fieldwide
reservoir engineering analysis of the Pilgrim Springs, Alaska, geothermal reservoir:
Proceedings, 8th Workshop in Geothermal Reservoir Engineering, Stanford
University, Stanford, CA.
Forbes R.B., Wescott, G., Turner, D.L., Kienle, J. (1979) A Geological and Geophysical
Assessment of the Geothermal Potential of Pilgrim Springs, Alaska: Unpublished
preliminary report to Alaska Division of Energy and Power Development and U.S.
Department of Energy
Forbes, R.B., Gedney, L., Van Wormer, D., and Hook, J. (1975) A geophysical
reconnaissance of the Pilgrim Springs, Alaska: Geophysical Institute Report UAG-
R231.
Hanse, Cedric Nathanael. (2005) Factors Affecting Costs of Geothermal Power
Development. Geothermal Energy Association.
Kirkwood, P. (1979) Status of Pilgrim Springs: Topical Report – Energy Systems, Inc.
prepared for U.S. Department of Energy.
Kline, J.T. (1981) Surficial Geology of the Lower Pilgrim River Valley and Vicinity,
Western Seward Peninsula, Alaska: Alaska Division of Geological and Geophysical
Surveys, Alaska Open File Report AOF-140
Lofgren, B.E. (1983) Results of Drilling, Testing and Resource Confirmation -
Geothermal Energy Development at Pilgrim Springs, Alaska: Unpublished report of
Alaska, Woodward-Clyde Consultants to Alaska Division of Energy and Power
Development.
Rafferty, Kevin (2000) Geothermal Power Generation, a primer on Low-Temperature,
Small-Scale Applications: Fact Sheet by Department of Energy Geo-Heat Center.
Wescott, E., and Turner, D.L. (1981) Geothermal reconnaissance survey of the central
Seward Peninsula, Alaska: Alaska Geophysical Institute, Report UAG-R284.
Table 1: Confirmation Program Components and Unit Costs
Method Unit Cost per unit
($)
For 500 ft
deep/90ºC
For 5000 ft
deep/150ºC
Administration project 7.5 % of total
confirmation
costs
0.2 M$ 0.3 M$
Drilling : Full diameter hole foot Cost =
240,000 + 210
(depth in feet)
+ 0.019069
(depth)
2
0.3 M$/Well 1.8 M$/Well
Drilling : Hole productivity °F MW/Well =
reservoir
Temp. (°F)/50
– 3.5
0.4 MW/well 2.5 MW/well
Drilling : Unsuccessful hole
factor
% 40% 5 wells
needed* =1.5
M$
2 wells
needed* =3.6
M$
Other project 20,000 0.02 M$ 0.02 M$
Regulatory Compliance
(includes permitting and
environmental compliance)
project 5 % of drilling 0.08 M$ 0.2 M$
Reporting document:
(data
integration/analysis/modeling)
project 5 % of drilling 0.08 m$ 0.2 M$
Well Test: Full diameter hole,
3-10 days
well 70,000 0.2 M$ 0.07 M$
Well Test: Multi-well field test,
15-30 days
project 100,000 0.1 M$ 0.1 M$
Source: GeothermEx, "New Geothermal Site Identification and Qualification" (Table IV-
1), 2004.
* Number of wells needed to confirm 25% of the production capacity, which in our case
is 25% of 5 MW = 1.25 MW. Note that in the case of the deep, 5000 ft resource, one
successful well at 2.5 MW/well will confirm 50% of the capacity as modeled in this paper.
Table 2: Summary of Alternatives
Alt Temp Depth # of Wells Flow Rate # Generators Costs
(M$)
1 195 0F
90 0C
500 Feet 13~20
+ 4 reinjection
6,000 gpm 25 UTC @ 200 kW
5 UTC @ 1 MW
48-92
2 300 0F
150 0C
5,000 Feet 2 - 3
production
1 reinjection
1,750 gpm –
2,400 gpm
5 UTC @ 1 MW 54-103
3 300 0F
150 0C
5,000 Feet 2 - 3
production
1 reinjection
1,750 gpm –
2,400 gpm
1 Binary @ 5 MW 64 – 116
gpm: gallons per minute: kW: kilowatt, MW: megawatt
Alaska Energy Authority Preliminary Feasibility Study
HDL 07-301 Pilgrim Hot Springs, Alaska
April 2007 FIGURE 3
Pilgrim Hot Springs. Catholic Church built 1918-1920 and Mission grounds. View
facing mostly north.
The 7-1/2 mile access road from Road Marker 53 of the Nome-Taylor Road.
APPENDIX A
Model Schematics and Order of Magnitude Cost Estimates