In the following the cost of high temperature
geothermal wells is analysed. This includes the
preparation, the drilling and the completion of the well.
In high temperature geothermal wells the temperature
of the reservoir can be up to 300°C. The analysis is
based on experience gathered in Iceland for the past
The total cost of geothermal power plant has been
roughly divided in drilling, steam supply system, el-mech
and buildings. The cost of drilling is 30–40% of the
total cost. Usually this is for example higher than the
cost of turbine generator unit. The feasibility of a
geothermal power plant is therefore highly dependent
on how successful the drilling is. Preferably the wells
should be productive and at the same time inexpensive.
We divide the total drilling cost in three main parts:
• Preparation i.e. building a drilling pad, water
supply system and drilling and running a surface casing.
• Drilling of the high temperature well, including
• Completing the well after drilling i.e.
wellhead, silencer, drainage system and a house for
The percentage of the different parts of the drilling cost
will vary some what depending on the type of well
being drilled but the drilling itself is always by far the
largest. The total cost of drilling 2000 m deep vertical
well having ø8 1/2” production part is approximately
225 MISK (2,6 MEUR). This is excluding VAT. Design
and supervision is however included.
The production parts in high temperature wells in
Iceland is drilled either by using ø8 1/2” drilling bit or
ø12 1/4” drilling bit. The larger diameter production
part is generally considered more feasible where the
enthalpy is low and the smaller diameter where the
enthalpy is high. Well 20 in Krafla Geothermal Power
Plant was the first directionally drilled high temperature
well in Iceland. This was back in 1982. For the past
ten years directional drilling is becoming more and more
common and now every 3 or 4 wells out of 5 are
directionally drilled. While a directionally drilled well is
more expensive than a vertical one they have important
advantages. Wells can be made to cut promising
fissures, parts of the reservoir inaccessible from directly
above become accessible and several wells can be
drilled from each drilling pad.
The total cost of drilling different types of wells have
been compared. The comparison is based on 2000 m
deep wells. Included is the preparation, drilling and
completing the well after drilling. If one would also
include the cost of the steam supply system the
difference between vertical and directionally drilled
wells would be less.
For the past year aerated drilling has been tried in
Iceland and more than ten high temperature wells have
been drilled using this technique. The result has been
positive with respect to drilling but it is still too early to
confirm that the productivity of these wells is higher
than the productivity of conventional wells. The trial
aerated drilling carried out for the past year adds 7–
12% to the total cost of drilling.
The drilling cost has been divided into drilling, other
work carried out during drilling and material. This is
only the drilling cost i.e. neither preparation before
drilling or completion after drilling is included. It is
conclude that for high temperature drilling the cost of
work is 70–80% and the cost of material is 20–30% .
The drilling cost as a percentage of the drilling cost of
each well and the well depth has been studied. The
cost of drilling the last 500 m (from 1500–2000 m) is
approximately 15% of the drilling cost. By extrapolation
one can conclude that the drilling cost would be
increased by 15% if a 2000 m well would be drilled to
A primitive study has been carried out for evaluating
how the drilling cost of high temperature wells in
Iceland has developed for the past eight years.
Reservation must be made regarding the method used
and how accurately it represents the drilling cost. It is
also questionable if the cost index used in the
comparison, the Icelandic “byggingavísitala”, gives the
correct indication of general price increase. According
to the study the cost of drilling was more or less the
same until 2003. Since then it has decreased by over
20%. The large drilling contracts which have been
made in the past years are the primary explanation
why the cost has decreased. Because of those it has
been easier for the drilling contractor to organize the
drilling work and the drilling rigs are now working all
year round and not only in the summer time as before.
Bearing in mind how important the drilling cost is in the
total cost of geothermal power plants it is obvious that
the price development in the past years will affect
geothermal power plants feasibility in a positive way.