Reducing Subjectivity in Geothermal Exploration Decision Making (Presentation): NREL(National Renewable Energy Laboratory)

Sertac Akar, Katherine Young

Research output: NRELPresentation


Geothermal exploration projects have a significant amount of risk associated with uncertainties encountered in the discovery of the geothermal resource. Two of the largest challenges for increased geothermal deployment are 1) understanding when and how to proceed in an exploration program, and 2) when to walk away from a site. Current methodologies for exploration decision-making are formulated by subjective expert opinion which can be incorrectly biased by expertise (e.g. geochemistry, geophysics), geographic location of focus, and the assumed conceptual model. The aim of this project is to develop a methodology for more objective geothermal exploration decision making at a given location, including go/no-go decision points to help developers and investors decide when to give up on a location. In this scope, two different approaches are investigated: 1) value of information analysis (VOIA) which is used for evaluating and quantifying the value of a data before they are purchased, and 2) enthalpy-based exploration targeting based on reservoir size, temperature gradient estimates, and internal rate of return (IRR). The first approach, VOIA, aims to identify the value of a particular data when making decisions with an uncertain outcome. This approach targets the pre-drilling phase of exploration. These estimated VOIs are highly affected by the size of the project and still have a high degree of subjectivity in assignment of probabilities. The second approach, exploration targeting, is focused on decision making during the drilling phase. It starts with a basic geothermal project definition that includes target and minimum required production capacity and initial budgeting for exploration phases. Then, it uses average temperature gradient, reservoir temperature estimates, and production capacity to define targets and go/no-go limits. The decision analysis in this approach is based on achieving a minimum IRR at each phase of the project. This second approach was determined to be less subjective, since numerical inputs come from the collected data. And it helps to facilitate communication between project managers and exploration geologists in making objective go/no-go decisions throughout the different project phases.
Original languageAmerican English
Number of pages36
StatePublished - 2015

Publication series

NamePresented at the Stanford Geothermal Workshop, 16-28 January 2015, Palo Alto, California

NREL Publication Number

  • NREL/PR-6A20-63762


  • conceptual models
  • decision making
  • exploration targets
  • geothermal exploration
  • value of information analysis


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