Procurement Strategies, development and implementation

Drilling a deep geothermal well requires not only experienced drilling contractor but also a number of specialized service companies, and material supply companies.  While the drilling contractor supply the main equipment, the rig itself, crew and associated equipment, then a number of other service companies are involved, such as mud, cementing, logging and directional drilling specialists.  All of this needs procurement and logistic coordination and management in order to prevent expensive waiting time.  By using one “lead contract” or an “integrated contract”, then the Employer will simplify the whole project management, gathering most of the responsibility and coordination on the shoulder of one contractor, usually the drilling contractor.  This will further ensure efficient execution of technical and operational objectives, leading to reduced cost.

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Variations in an integrated drilling service contracts, which goes away from the traditional scope and risk factors does occur, which are mainly due to bargaining power over drilling contractors.  Such deviations may involve increased risk and responsibility usually taken by the developer but now transferred to the drilling contractor.  Example of this is the transfer of geological risk to the drilling contractor, which may cause financial loss.  In recent drilling tenders, now owners are asking for additional scope of work and risk, which has very little to do with drilling technology or operation.  This is various civil works, which is needed prior to the start of a drilling project, such as water supply, installation of camps, fencing and security service, and even permitting and licenses for the operation.  It can be debated if this type of civil work should be added on the shoulder of a drilling contractor for the purpose of reaching better economics of the project.


  1. Rig site preparation 
  2. Cementation equipment and services  
  3. Casing Running Services
  4. Directional Drilling Services
  5. Airated drilling services
  6. Mud Logging Services*
  7. Stimulation Services – Acidizing
  8. Electric Borehole Logging*
  9. Production Tests (Pump, Cooling Units, Data Recording)*


  1. Fuel, Diesel, Drill bits
  2. Cement and additives
  3. Tubulars, Casing including centralizers and float equipment
  4. Liner hanger
  5. Mud material, Bentonite and additives
  6. Wellhead equipment
  7. Acid

The term “geothermal” means “Earth heat” or “heat of the Earth.”. The heat flowing from the Earth’s interior is estimated to be equivalent to 44.2 terawatts-thermal (TWth) of power (Pollack et al.1993). This is more than twice the amount needed to supply total global primary energy consumption in 2015 (Energy Information Administration [EIA] 2017a). So, why isn’t this renewable energy source more widely deployed?

Clean sustainable energy source.

In times of climate change this type of sustainable energy source is vital for all humankind. It is known to be robust, economic and the most reliable energy source, which can provide baseload power to the grid, complementing the unsteadiness of solar and wind.  Further in a droughts situation and when hydro is not available, then geothermal is available and stable. To reach this energy you require drilling deep wells into the earth.  The most common depth of a geothermal well is from 2000-3000 meters. Heat pumps using low temperature near the surface are not the subject in this short description.

The amount of usable energy from geothermal sources varies between locations, with depth and by extraction method.  The most common extraction approach is when the hydrothermal fluid or steam are brought to the surface.  The hot water or steam then powers a turbine that generates electricity.  There are mainly three types of geothermal power plants.  Those are, dry steam plants, flash steam plants and binary cycle power plants. Flash system is the most widely selected configuration for high temperature resources.

The geothermal energy is not only used to produce electricity.  It can be used directly as heat (direct use), such as space heating and bathing, and even for air conditioning in summertime or in warmer countries. There is enormous potential to use geothermal heat directly. Agriculture and industries can benefit too. The cascaded use of the energy can for example provide heat for food dehydration (drying), heat for greenhouses, and milk pasturing just to mention few out of many options.

If you like to watch a video explaining geothermal click here

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