Isra-Mart srl:Exclusive: Cornish geothermal plant seeks oil and gas backing

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The UK's first deep geothermal power plant is on the brink of securing financial backing from the oil and gas industry, moving the planned 10MW project one step closer to reality.

Speaking to BusinessGreen on the sidelines of an industry event yesterday, Ryan Law, managing director of Geothermal Engineering, said the firm has been holding extensive meetings with an unnamed potential investor from the oil and gas sector for its proposed £40m geothermal plant in Redruth, Cornwall.

The company is planning to make a formal funding announcement in the coming months and then expects to start drilling the first well by October this year. The 4.5km-deep well is expected to access rocks that reach temperatures of up 200°C and is intended to be followed by two further wells.

Geothermal Engineering has already raised the £10.5m needed to complete the first well and test the viability of the site through a mix of private sector backers and a £1.5m grant awarded by the Department of Energy and Climate Change in 2009.

But the company now needs to raise a further £30m to complete the project if it is to achieve its goal of bringing the plant online in 2013.

Once fully operational, it is expected to have a 10MW capacity and will also provide up to 55MW of renewable heat energy for the local community – the equivalent of heating 20 schools for a year.

Deep geothermal plants work by pumping water down to rocks about 5km below the surface that are at high temperatures of around 200 degrees centigrade. Once there, most of the water turns to steam and is then pumped back up and converted into geothermal electricity using a steam turbine. When cooled, the water can be reused to produce more geothermal energy.

Oil firms are generally receptive to deep geothermal power as they use similar technologies and practices. The US Department of Energy (DoE) has also backed a geothermal "coproduction" project, which sees geothermally heated waste water from oil wells used to generate electricity.

DoE said coproduction has a "significant" potential to produce electricity for field use or to be sold to the electrical grid, estimating that an average of 10 barrels of water is produced with every barrel of oil.