Geothermal needs better tools for superhot drilling. Hephae can help.

Thousands of feet beneath the desert valley of southwest Utah, a slender tool tucked inside a drill pipe is barreling through hot granite. The rod-shaped device, built by the startup Hephae Energy Technology, is a tracker of sorts, wirelessly sending data to help operators above steer the drill below and to measure rock conditions.

The work is underway at Fervo Energy​’s Cape Station, the largest project in the nation using nascent techniques to tap earth’s heat for clean energy. The 500-megawatt endeavor could usher in an era of next-generation geothermal development — but only if the industry can bring down drilling costs.

That’s where tools like Hephae’s can help.

Oil and gas firms have long used similar ​“measurement-while-drilling systems” to bore holes underground. But off-the-shelf parts aren’t designed to withstand the higher rock temperatures that geothermal companies aim to reach, which makes the equipment less efficient and costlier to operate.

Hephae’s founders, veterans of the fossil fuel industry, saw an opportunity to create a more advanced version for the burgeoning next-gen geothermal market. ​“We realized that companies like Fervo need the same exact tools that we’ve been working on for the last 45 years,” Steve Krase, Hephae’s CEO, recently recalled.

“They just need to work a hell of a lot hotter,” he added.

Hephae deployed its high-temperature device for the first time commercially at Cape Station earlier this year and has since used it there it additional times, Krase said. His firm will soon ship another of its high-tech rods to the startup Mazama Energy, which has started drilling its commercial pilot facility near the Newberry Volcano in central Oregon.

Geothermal firms ​“are basically trying to get underground as cheaply as possible,” said Stephanie Díaz, a senior associate for technology and innovation at BloombergNEF. She said the pursuit is a ​“rising tide that lifts all boats,” given how innovation spreads.

Investors are backing firms along the supply chain as a way to get exposure to the geothermal market, but without taking on the risk of building a first-of-a-kind project. ​“Instead of having to figure out an entire power plant, you just need to figure out one component that is essential to creating the power plant,” Díaz said.

How Hephae’s tech could curb geothermal costs

Krase and his co-founder, John Clegg, launched Hephae in 2020 to adapt their oil and gas expertise for geothermal wells.

Their measurement-while-drilling system fits into a thick steel tube that connects to the rock-cutting drill bit. Sensors and rounded circuit boards — stacked like chips in a Pringles can — gather subsurface data and transmit it through a sequence of pressure pulses, enabling engineers to steer the drill through the challenging environment.

Conventional versions of the tool are built to operate at relatively lower temperatures — around 175 degrees Celsius (347 degrees Fahrenheit) — where oil and gas reserves are typically found. But for geothermal firms, the higher the rock temperature, the more energy they can wring out of the system, making each well more cost-effective and productive.

Right now, that means geothermal developers must occasionally pause for extended periods to cool the drilling fluid inside the wells to avoid overheating the electronics. This ​“nonproductive time” can cost operators roughly $500,000 to $1 million per well, since they’re still paying to rent a drilling rig they’re not using, according to Krase.

Hephae says its unique design can withstand temperatures up to 210℃, reducing work delays by directing heat away from the sensors and circuits as they operate. Before shipping the tool to Cape Station, the company put the technology through its paces at an Oklahoma test facility and in Texas at a high-temperature gas well — another possible market for Hephae.