SLB and Ormat partner to develop enhanced geothermal systems

SLB (NYSE: SLB) and Ormat Technologies (NYSE: ORA) announced an agreement to accelerate development of integrated geothermal assets and enhanced geothermal systems (EGS), according to a press release statement.

The partnership aims to develop EGS technology, which creates thermal reservoirs in hot rock formations to generate geothermal energy beyond areas with conventional geothermal resources. The companies plan to design and construct an EGS pilot project at an existing Ormat facility.

The collaboration combines Ormat's power plant design and operations expertise with SLB's subsurface and reservoir engineering capabilities. Following the pilot phase, the companies intend to pursue commercial-scale EGS deployment for utilities, independent power producers and data center operators.

"By bringing together the world's leading experts in subsurface and geothermal power plant technologies, Ormat and SLB will accelerate the path to rapid deployment of commercial scale EGS facilities," said Doron Blachar, chief executive officer of Ormat Technologies.

Gavin Rennick, president of New Energy at SLB, stated the partnership aims to make both traditional hydrothermal and EGS technologies "truly competitive and commercially viable systems that can scale quickly to meet global energy demand."

Traditional geothermal systems require natural hot water or steam reservoirs, limiting their geographic application. EGS technology expands potential geothermal deployment by creating artificial thermal reservoirs in naturally hot rock formations.

The U.S. Department of Energy estimates next-generation geothermal could provide 90 gigawatts by 2050, with potential for up to 300 gigawatts in the United States. Ormat currently operates a 1,268MW geothermal and solar generation portfolio across multiple countries.

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