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Vol. 26, No.1 Week of January 03, 2021
Providing coverage of Alaska and northern Canada's oil and gas industry

More Mount Spurr geothermal exploration

State proposes issuance of a two- to three-year prospecting permit for the southern flank of volcano to Raser Power Systems LLC

Alan Bailey

for Petroleum News

Alaska’s Division of Oil and Gas has issued a preliminary finding, proposing the issuance of a noncompetitive prospecting permit to Raser Power Systems LLC, for geothermal exploration on the southern flank of the Mount Spurr volcano. The permit area encompasses about 6,750 acres in three tracts, about 80 miles from Anchorage and about 40 miles west of Tyonek on the west side of Cook Inlet. Raser Power Systems is a geothermal company based in Salt Lake City.

The permit grants Raser Power the exclusive right to prospect in the designated land tracts for two years, with the possibility of an extension for a further year if the company has been unable, “despite reasonable diligence,” to discover a commercially viable geothermal resource within that initial two-year period.

The division says it only received one application for a permit following a call for applications in February 2019 - hence the proposed issue of a non-competitive prospecting permit at a rental rate of $3 per acre. Raser Power will need an approved plan of operations and all relevant federal, state and local permits before commencing operations on the land tracts.

Volcanic heat

One of a series of volcanoes along the Alaska Peninsula and the north side of the Cook Inlet, Mount Spurr clearly pinpoints an area where there is geothermal heat in the subsurface. And, with the area of geothermal interest being around 40 miles from the Beluga power station on the Alaska Railbelt electricity grid, there is the potential to establish a geothermal power plant at Mount Spurr, should a viable geothermal energy source be discovered. A geophysical survey conducted in the 1980s pointed to the possible existence of a layer of warm or hot brine 2,000 feet below a plateau at the entrance to the pass on the south flank of the mountain.

In 2008 Ormat Technologies, a Lower 48 geothermal company, paid $3.5 million for 15 state leases on the flanks of Mount Spurr. In 2009 the company began an evaluation of its leases by conducting various forms of aerial survey, coupled with gravity and electromagnetic measurements. The company followed up in 2010 with the drilling of two core holes to depths of 1,000 feet. Then, in 2011, the company brought in a drilling rig to drill to a depth of 4,000 feet.

Unfortunately the drilling failed to discover a viable geothermal resource, with Ormat encountering difficulties in drilling through a conglomeratic rock formation to test presumed hotter rocks underneath. The company eventually decided to write off the $7.3 million it had invested in the project. However, given the obvious heat associated with the active Mount Spurr volcano, coupled with its convenient location, the geothermal potential of the area remains intriguing.

Current volcanic activity

The current active vent for the volcano consists of Crater Peak, on the volcano’s southern flank, above and to the north of the prospecting tracts. There is a discontinuous zone of weak geothermal activity, including warm seeps, springs and fumaroles, extending from south of Crater Peak to the north side of Mount Spurr. And there is a meltwater lake created by increased heat flux that began in 2004 at the mountain’s summit, the division says.



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