Launched a Texas-focused geothermal trading group with major energy backers

Jan 12 (Reuters) – A trade group seeking to promote geothermal energy in Texas will launch on Thursday with backing from major oil and utility companies seeking to transform their businesses.

The Texas Geothermal Energy Alliance (TxGEA) has been organized as many fossil fuel giants and start-ups seek to switch to low-carbon energy from oil and gas. The group includes Halliburton (HAL.N), Repsol (REP.MC), Chevron Corp (CVX.N), Baker Hughes, CenterPoint Energy (CNP.N) and GeothermEx, a Schlumberger company.

Former chairman of the state’s utility and energy regulatory boards, Barry Smitherman, led the formation of the group. Texas is the largest oil and gas producing state.

“Decision makers and opinion leaders are interested in a clean, renewable, dispatchable resource — that’s what piqued everyone’s interest,” Smitherman said. He added that the group’s short-term focus will be education and advocacy.

Geothermal technology uses much of the same drilling technologies used in the oil and gas sector, although the wells are designed differently. One member, Nabors Industries, a drilling company, already sees geothermal energy as a business opportunity.

Smitherman said service companies see it as another way to use their technology, workforce and skills.

Many geothermal projects are currently underway in the United States, which could pave the way for greater scale for an industry that does not yet easily compete with cheaper oil and gas.

According to TxGEA member Sage Geosystems, geothermal represents less than 1% of global utility-scale electricity production because it is geologically constrained.

The United States has approximately 3.5 gigawatts of geothermal capacity currently installed.

Reporting by Liz Hampton in Denver; Editing by Cynthia Osterman

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