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Examining the strategies and deployments around decarbonisation in hard to abate sectors, we speak with CEOs, heads of corporate strategy, CTOs, Innovation/R&D, project directors & heads of carbon management from around the world. Hosted by Alex Cameron of the Decarbonization Leaders Network and Decarb Connect & produced by Janno Media.
Alex Cameron: I mean, I won't be entirely flippant, but the idea of being able to go to a dinner party and say, "Yeah, I'm directing a microwave beam at a volcano. That's what I do for a living. What do you do?"
James Benetatose: Yeah, it definitely sounds very sci-fi-esque, but it's real and it's happening.
Alex Cameron: Well, welcome back to the Decarb Connect Podcast. I'm Alex Cameron, Founder and CEO of Decarb Connect, now known as Industrial Connect Group. And I'm here today with James Benetatose, who's Head of Business Development at Quaise Energy. And we are in the fortunate position—we, you, the listeners, and me—of hearing about a first-of-a-kind geothermal project that's taking place in Oregon. So, James, hello, welcome to the podcast. And would you like to just kick off with: How did you personally arrive at this point in time? So, tell me a bit about how you got here, and how Quaise got here, and we'll go from there.
James Benetatose: Absolute pleasure. Great to be here. Thanks for having me. My journey started back in college, having a hard time choosing which major to study, and ultimately, I decided on petroleum engineering. There was nothing really to it, except I saw pictures of petroleum engineers wearing coveralls, working outside, and I said, "I want to do that." So, I chose petroleum engineering and started my career working offshore oil and gas. Spent a number of years working in the Gulf of Mexico, then transitioned into product development and manufacturing for the power sector. Spent about four years doing that, had some international experience. And during that international experience, I lived in Italy, in Milan, and it was a very polluted city. It was really my first time experiencing pollution of that kind, and kind of the effects of the oil and gas industry in an area where the pollution had an effect on my health.
So, I made the decision then that I was going to work in the energy transition and be a part of a clean energy company. So, I went to grad school, got my MBA, and found Quaise while I was doing my MBA at Boston University. Ever since then, it's been a great journey of studying the various different business models. And ultimately, we settled on: We're not going to be a drilling services company—which was never the intention—but the intention was always, we want to be a geothermal energy developer. So, we made that decision, and here we are today, developing our first project at the Newberry Volcano near Bend, Oregon.
Alex Cameron: It's interesting. We've had a couple of—well, several—companies on the podcast before who've, in their own market segment, made that same decision about being a project developer versus tech/tool only. So, just for those who might not have thought this through before: Why? Why is that so important, and why has it been such a significant course of action for you guys?
James Benetatose: I think, first of all, is that there's no one developing super-hot-rock geothermal energy today. So, there was not necessarily a customer for a deep drilling technology such as millimeter-wave drilling. So, when we think about how to commercialize this, we don't necessarily think of drilling the hole as the product; we think of the entirety of the subsurface as the product. So, that means that we're drilling the wells, we're completing them, we're stimulating them, and we're getting them flowing. So, just selling a drilling service is not necessarily going to be a successful commercialization pathway. And if we're going to be doing all of that work on the subsurface, why not bundle it with the surface infrastructure, which is a lot easier? It's not an easy project, but building power plants—there are multiple companies that know how to do that, and you can get EPC contractors to do that for you. And then you're selling the more valuable product, which is the electricity, rather than the heat itself.
Alex Cameron: Okay. Good, so that's a good summary that gives the context of where we are right now. I guess the only other bit of context before we talk more about the actual project is the technology. So, I mean, millimeter-wave gyrotron drilling—these are not familiar terms for most people. What does this really mean, and how do you paint the picture of how it differs from typical projects?
James Benetatose: Yeah, so if we look at all the wells that have ever been drilled in the world, there have been very deep wells drilled—deeper than 12 kilometers for the Kola Superdeep Borehole in Russia. It was drilled a long time ago, so it's still the deepest well. And then we look at hot wells. So, there have been very hot wells drilled—400, even 500 degrees Celsius wells have been drilled. But the combination of a hot, deep well has never been drilled before. There's never been a well above 300 degrees Celsius past 5 kilometers ever been drilled before.
So, we look at that and we say, "Okay, is it an economic challenge or is it a technical challenge?" In our assessment, it's both. So, that's where millimeter-wave drilling comes in. Millimeter-wave drilling is an energy-based drilling method. So, we replace mechanical crushing and grinding of the rock with ablation. And we move away from a mud-based drilling—or mud or water-based drilling system—to an air-based drilling system. And with those two challenges removed, we think we've solved the problem of deep, hot drilling. We overcome the challenges of transferring power to the bit, so instead of trying to get torque downhole and use mud motors that don't work above 300 degrees Celsius, we use waveguides to transmit power from a gyrotron—which is a microwave-generating device—down to the rock face where it is ablated. And instead of trying to establish circulation with heavy muds that could fracture the formation and cause lost circulation, we use air to get sub-micron particle size particles out of the well.
So, in essence, we have a gyrotron, which is the microwave-generating device. It's a device that was developed in the '60s or '70s in the Soviet Union for fusion research, actually. And that's where it had stayed for a while, as a fusion research technology used in fusion experiments around the world as a way to heat up their plasma to hundreds of millions of degrees Celsius. A researcher at MIT decided, "Well, I could use this beam of energy to destroy rock and drill deep holes into the Earth for geothermal energy." And we've since taken that physics-based research at MIT and commercialized the technology to where it is today, where we're drilling hundreds of meters—almost a kilometer deep now—at our test site in Marble Falls, and then expanding the power level 10x. So, we're right now receiving a megawatt-scale gyrotron, and we're going to be replicating what we've done at our test site in Marble Falls to drill to 1 kilometer, but increasing the rate of penetration and the hole size.
Alex Cameron: So, what is known, if you like, and proven so far, is that this technology works. What is yet to be—what's next on the agenda? Is it to do with the depth that this can go to?
James Benetatose: That's right. The next steps are drilling to greater depths and then drilling in relevant temperature formations. So, right now, we're drilling in a granite quarry. It's close to the surface; it is not a geothermal project. It is purely a test site, research and development, to prove the technology at this first test scale. So, then we want to take it: bigger hole size, then deeper, then to relevant—which will, at the same time, reach the higher temperatures. And then we'll be introducing, kind of repeating those steps with directional drilling, and then packaging that all together in a commercial well once we have all of those steps proven.
Alex Cameron: So, we're moving from this quarry-based project to Oregon. So, tell us about the site, why this place, and then what's the nature of the project? What can you tell us about it?
James Benetatose: Yeah, so Newberry Volcano is one of the youngest volcanoes in the United States. I believe it's a shield volcano, and it has a melt zone or a magma chamber below it. And that's really what is creating this heat source. And it is a very well-characterized subsurface area. So, there has been drilling here since, I believe, the '80s, because they've been hunting for a hydrothermal resource because it's so hot. Everyone was like, "Okay, if we can find a hydrothermal resource here, it would be almost equivalent to The Geysers," which is the largest geothermal field in the US.
But for four decades, everyone has come up with dry holes. So, with the advent of EGS (Enhanced Geothermal Systems) or multi-stage hydraulic fracturing—because at Newberry, they've actually had some past EGS projects using hydroshearing rather than multi-stage hydraulic fracturing. So, the difference would be trying to activate existing fractures to create permeability, instead of using high-pressure pumping to create new fractures.
So, yes, it's a very well-characterized site, so we know for a fact that there is a heat source there. And beyond that, it is in a good region as far as off-take. There are multiple pathways to get the power out and to customers that need power.
Alex Cameron: So, before we go a little bit more into where we're at, what's the outcome? Can you try—it's always a funny question to ask people on an audio podcast, but can you paint a picture of what is the outcome of this work over the next two or three years? What would you expect to be built there? How do you expect to connect it? Do your best to paint that kind of picture.
James Benetatose: Yeah, so this is a project that we're undertaking in two phases. We decided to get started on the project prior to millimeter-wave drilling being commercially ready, and that's because we had seen enough progress on the millimeter-wave drilling technology to say, "Okay, we don't want to be starting a project when millimeter-wave is exactly ready; we want to be at the point where it can just slot into the project."
And so, we decided to start with conventional drilling to drill our first EGS triplet, or an Enhanced Geothermal Systems triplet. That will allow us to get about 30 megawatts gross of power online—or established in the subsurface—prior to introducing the millimeter-wave drilling technology to further expand. So, the first outcome for the project will be in stages. The first outcome is a confirmation well drilling to 300 to 400 degrees Celsius. That will confirm the resource and give us information about the stress state, the fracture orientation, the fracture growth, and the fracture toughness.
This is something that Quaise is doing that other EGS developers are not: We are actually going to be fracturing our confirmation well. We believe that it is a step beyond what others are doing, and it should set the standard on how to do EGS development. From that, we will then drill an EGS doublet, which will allow us to flow test and establish the resource. So, we are anticipating around 15 megawatts gross power production potential from that EGS doublet. That is an injector and a producer pair, with a hydraulically fractured reservoir in between them to allow us to sweep the heat from the rock and produce that at the surface.
We'll then expand that with one production well, and that would be a triplet. So, that would be one injection well to two producer wells. We feel that that's a very good ratio for development. It allows us to maximize the fluid that we can pump through the injection well and produce through two production wells because of the density change, so we're able to get all that fluid back.
Then we're going to replicate that with going deeper and hotter using the millimeter-wave drilling. So, this first system will be at around 315 degrees Celsius average reservoir temperature, and then introducing the millimeter-wave drilling technology, we're going to go even deeper and hotter. So, we'll be around 365 degrees Celsius average reservoir temperature, and we've chosen that specifically to stay under the supercritical point of water. Then we will build two power plants to use that heat to produce power and send that to the grid to an off-taker.
Alex Cameron: So, before we get to the power plant stage, what would someone like me, walking by that site, see at surface level?
James Benetatose: Yeah, today you would see a drilling rig. You'd see a drilling rig and multiple—all the auxiliary equipment needed to drill a well.
Alex Cameron: Okay, and then in terms of how you actually transmit—the transmission systems—are they away from power plants? Is that existing, or is that a whole other infrastructure?
James Benetatose: There is existing power infrastructure as far as the grid, but with any new power project, you have to build the transmission to get to the existing grid.
Alex Cameron: It's interesting to me that this site has already had that testing and drilling for so long, because when you think about how geothermal is presented in the news now, or any kind of use of a site like that, you kind of feel it's a very recent form of exploration. But actually, having that site having been explored before, does that mean there is data you can access that's more helpful to you, or what else does that do for you?
James Benetatose: There was a lot of data available to us, mostly coming from NREL, the National Renewable Energy Laboratory. They had the DEEP-IN project, so they had a repository of data that they had collected and interpreted that was open source that we were able to utilize to really build our subsurface model and create our own interpretation of the heat source.
Alex Cameron: And have you met some of the people that have been on that site before you guys started?
James Benetatose: Yeah, so two of our team members, Trenton Cladouhos and Jeff Garrison, were actually part of the team at AltaRock. So, they were doing some of the original EGS work here at the Newberry Volcano back in 2010, and they were involved with many other projects in geothermal. But they've been working at the site for over a decade now.
Alex Cameron: Yeah. I mean, I have to say—I won't be entirely flippant, but the idea of being able to go to a dinner party and say, "Yeah, I'm directing a microwave beam at a volcano. That's what I do for a living. What do you do?" That must open some seriously mad conversations.
James Benetatose: Definitely sounds very sci-fi-esque, but it's real and it's happening.
Alex Cameron: Yeah. So, timeline then. Walk us through—obviously, you've been through a couple of these gateways already so far, and this is specifically on the Newberry Volcano—what's the timeline to producing power that goes into the grid?
James Benetatose: Yeah, so right now it's all about achieving milestones and then capital formation. We are still a venture-backed company, so we have to raise money in tranches, which means we will do this first EGS doublet test, and then we will raise more money. If we didn't have that constraint, things would happen a lot faster. But what we're anticipating is that we can get power online to the grid by 2030, but then have the next 200, 250 megawatts online very shortly after that, with the intent to develop this site even further.
Alex Cameron: And then permitting? I mean, most projects of any sort that we hear about, whether it's in the US or Canada or Europe or anywhere, permitting is the thing that makes everyone pull their hair out or roll their eyes. What's that been like for you, and to what extent is that setting pace as much as the capital is?
James Benetatose: Yeah, absolutely. So, the Bureau of Land Management is the permitting agency here. The site is actually—US Forest Service owns the surface because it is a national forest, and then the BLM owns the subsurface. But the BLM takes the authority on permitting the whole project, and they've really been a great partner. I don't think we have enough good things to say about the BLM and how collaborative they've been working with us.
We were able to get our categorical exclusion extremely fast relative to what the team expected—a year, and I think we had it in four or five months. So, we were able to start work right away. So, yeah, not enough good things to say about the BLM getting this permitting done.