UK's Ceraphi Acquires Former Shale Developer's Assets

Geothermal energy developer CeraPhi Energy has acquired the business of Third Energy Limited, a former shale gas development company planning to repurpose its existing wells into geothermal energy centers.

The acquisition includes subsidiaries Third Energy Trading Limited, Wolfland Renewables Limited, Wolfland Utilities Limited, Third Energy UK Gas Limited, and a 50 percent holding in West Heslerton Renewables Limited. The assets, located in North Yorkshire in the United Kingdom (UK), include eight well sites consisting of 12 former gas wells in a suspended state, 13.9 miles (22.4 kilometers) of 6-inch and 10.3 miles (16.6 kilometers) of three-inch subterranean pipelines and 13.9 miles (22.4 kilometers) of buried fiber optic communication lines, Ceraphi said in a recent news release.

CeraPhi describes itself as the UK’s leading closed-loop geothermal energy developer. The company completed a commercial demonstration of its CeraPhiWell™ system earlier in the summer using a Third Energy site.

“The decarbonization of heat represents a huge UK and global challenge in meeting our net zero targets”, CeraPhi CEO Karl Farrow said. “Combined with the continued insecurity customers face with volatility and seasonal cost of fossil fuels, we have to move geothermal energy to scale to reduce the cost of deploying direct use heat, which is an endless resource not subject to price fluctuation, enabling a move away from our dependency on fossil fuels within our day-to-day energy mix”.

“By using the inexhaustible resource beneath our feet using closed-loop technology we can access this energy anywhere with zero environmental risk, requiring no hydraulic fracturing, no use of water and providing enough energy within the next 15 years to solve our energy crisis indefinitely”, Farrow added.

“At Third Energy we’ve been pursuing a transition strategy for several years now with geothermal energy at the center of that strategy and in CeraPhi we have found a capable and accomplished partner, as proven by the successful geothermal demonstrator project at our KMA site this summer”, Third Energy Managing Director Russell Hoare said. “Bringing together the expertise of CeraPhi with the assets of Third Energy is a natural progression and I look forward to working with Karl and his team to continue the story”.

CeraPhi said its strategy is to de-risk the scaling and commercialization of large-scale heat networks using boreholes down to a depth of 1.2 miles (two kilometers), “reducing the space required for deployment of large-scale systems and increasing the extraction of thermal energy available for network connections”. By both drilling new wells and repurposing end-of-life and non-producing oil and gas wells, the company’s solution will provide “huge commercial potential” for the scaling of geothermal heat networks in the UK and globally, it added.

CeraPhi’s closed loop technology is designed to fit into old wells to extract heat from deep underground by a downhole heat exchanger, the company outlined. Depending on the operating temperatures, the heat produced could be used as direct power and/or heating or cooling for utilities and other services reducing the overall carbon emissions of the facility, according to CeraPhi.

Geothermal technology has been receiving attention in recent years as global players continue to adjust to the energy transition. In October 2023, the U.S. Department of Energy (DOE) announced the awarding of $264 million in funding for 29 projects to develop solutions for specific scientific challenges outlined in its Energy Earthshots initiative to advance clean energy technologies within the decade. One of the initiatives is the Enhanced Geothermal Shot, which focuses on reducing the cost of enhanced geothermal systems by 90 percent to $45 per megawatt-hour (MWh) by 2035.

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