Geothermal Deep Drilling Service

WORKSHOP ON GEOTHERMAL ENERGY:

ICELANDIC - BRITISH COOPERATION,
17th of November 2011, London
Vilhjalmur Gudmundsson
Contents

 Company overview, history and management

 Strategy

 Rig Fleet, drilling operations and service

 International market overview

 Summary and highlights

Overview

Business Area
 IDC is the largest drilling company worldwide focusing on geothermal energy.

Operation
 Drilled 160 high and low temperature (up to 320°C) geothermal wells the last 10 years and
over 230 since 1970. Well depths range from 1.000 to 4.500 meters.

Main operating countries

 Iceland, New Zealand, Dominica, Germany, and Azores.

Upcoming and past International Projects

 Denmark, Switzerland, Hungary, UK and Ireland.

Rigs and employees

 4 rigs in Iceland.
 1 in New Zealand, 1 in Dominica and 1 rig in Germany.
 135 employees.
Overview cont.

Associations – Membership
 IADC, International Association of Drilling Contractors.
 IGA, International Geothermal Association.
 EGEC, European Geothermal Energy Council.

Certification QHSE
 2008 - Quality Management System - ISO 9001:2008.
 2010 - Environmental Management System - ISO 14001:2004.
 2010 - Occupational Health & Safety Management System - OHSAS 18001:2007.

Auditors
 PWC: from 1986.
 History

 1945 State Drilling Contractors established.

 1986 Jarðboranir hf. (Iceland Drilling Ltd.) established.

 1993 Listed on the Iceland Stock Exchange (ICEX).

 2005 Acquired by Atorka Group and consequently delisted

from ICEX.

 2007 Acquired by Geysir Green Energy.

 2007 Hekla Energy GmbH established.

 2011 Acquired by Miðengi.

 2011 Currently in a selling process

Organisation
Management Team
Bent Einarsson CEO
Bent has significant experience in the sector, he has been 21 years with IDC, the last 19 years as CEO and before that as
CFO. Bent holds a Cand. Oecon degree from the University of Iceland.

Gunnar Freyr Gudmundsson CFO

Gunnar joined the company in 2008 from Icelandair Group where he worked as CFO of one of its subsidiaries. Before
joining Icelandair Gunnar worked as an auditor for PwC. Gunnar has a Cand. Oecon degree from the University of Iceland
and is also a Certified Public Accountant.

Vilhjalmur Gudmundsson CDO

Vilhjalmur joined the company in 2006. He has years of experience as project manager on different international marketing
projects, working for the Trade Council of Iceland. Responsible for business development on foreign markets and
marketing. Vilhjalmur has Cand Oecon and MBA degree from Lunds University in Sweden.

Sturla Birkisson CTO

Sturla joined the company 6 years ago. He has 8 years experience on different mechanical engineering projects.
Responsible for drilling equipment, tenders and contracts, planning and procurement. Sturla has a MSc degree in
Mechanical Engineering from Technical University of Denmark.

Thor Növig CEO Europe

Thor joined the company in 2007 as CEO Europe as well as being MD of Hekla Energy GmbH. He has 30 years of
experience in the drilling industry, working as MD of the drilling contractor ITAG in Germany prior to joining IDC. Thor has a
MSc degree in Drilling Technology.
Strategy
Mission and core values

Our mission is to support our customers to develop and access energy

resources in an economical and environmentally responsible way

Reliable Ambitious Flexible

 The safety of our
employees, customers and
environment are our
cornerstones.
 We operate in accordance
to laws and regulations,
fulfill our obligations and
communicate with integrity.
 We earn our trust through
consistent reliability and
quality.
 We are dedicated to deliver
to the challenging
expectations of our
customers.
 We strive to achieve
maximum results through
continuous innovation.
 We deploy professional
work ethics and develop
our ability to deliver
according to the highest
standards that govern our
industry.
 Our operations and service
adapts easily to new
market situations and
customer requirements.
 Our equipment is highly
mobile and we can execute
any project under various
conditions.
Vision

Modern rig technology

 Our competitive advantage is in geothermal drilling. Our experience in complex geological conditions in Europe
and modern rig technology have provided us with opportunities to diversify into new project types.

Geographically diversified operations

 Our turnover will increase through a balanced geographical distribution of revenues.

HSE – Health Safety and Environment

 Our reputation is to deliver excellent result for our customers with safety as a priority and in harmony with the
environment.

Human Resources
 Employees have solid basis for personal growth and share our vision for the future. Employee satisfaction is the
highest in our industry.
Rig fleet – service and operation
Rig fleet

80% of IDC‘s assets are „new“ drilling rigs

 IDC rigs are in the category of medium size rigs suitable for geothermal drilling as
well as oil and gas.

 IDC rigs are highly automatic for safe and fast operation.

 IDC rigs are maintained to highest standards to meet our customers standards.

Rig type Year Model Hook MP Drilling

Load number depth
[mT] power [m]
[hp)
Rig002 (HE) 2008 Euro Rig 350 3 X 1600 6000
TÝR 2007 HH300 270 3 X 1000 5000
ÓÐINN 2006 HH220 200 2 X 1000 4000
GEYSIR 2004 HH220 200 2 X 1000 4000
JÖTUNN 1973* 700 E 180 2 X 800 3300

SLEIPNIR 1998 G102 100 2 X 700 2200

SAGA 2001 G55 55 1 X 500 1500
Service and Operations

Integrated drilling solutions

• Directional drilling, Aerated fluid drilling, Casing
running, Cementing, Stimulation, Well completion,
Production testing and logging

Technical expertise
• Geologically challenging and demanding conditions
• Medium / Hard rock drilling
• Difficult basalt drilling
• Drilling in production zones with lost circulation

Drilling efficiency
• In 2008 IDC drilled 70 km in Iceland with average
drilling speed of about 50 meters pr. day of total rig
time including mobilization. Optimal drilling speed
during drilling operation can reach 200-250 pr 12
hours shift
 HH-220 and HH-300
New generation of rig
• SCR – hydraulic land rig

• Especially designed for geothermal operations

• Compact rig site

• High environmental standards

• Low noise emission (encapsulated generator sets)

• Fast automatic pipe handling system

(vertical system, 14 sections, DP range 3)

• Hydraulic operated power swivel

• Independent driven rotary table

• Automatic power slips

• Automatic hydraulic power tongs

• Controlled casing make-up

Main rig components

Automatic
Pipehandler
Mast

Mud Mixing Mud pumps

Drillpipe Bins
Engines Mud tank system Drillers
cabin

Offices
Operations – Rig fleet (Bentec Euro rig)
Operation – rig fleet HH-300
IDDP: TYR: HH-300 in Krafla, March 2009

Hekla Energy GmbH, Hunäusstrasse 7a, D-29227 Celle, Tel: +49 (0) 5141 34921 0, www.heklaenergy.com
Our Gardner Denver rig working in the Azores 2009
Framkvæmdir á Reykjanesi
Mauerstetten 2009
Euro Bentec rig in Noville, Switzerland
Click to edit Master text styles
Second level
Third level
Fourth level
Fifth level
 Icelandic Deep Drilling Project IDDP
in Krafla spring 2009

IDC chosen because of its experties in high

temperature geothermal drilling

Drilling into high temperature hydrothermal system

Heat expected above 450° C

Target: Super critical conditions

Estimated dept was 5 km in an area where normal

drilling dept is 2,5 km

Drilling stopped at 2,1 km when reaching magma

Supercritical Conditions:
Temperature > 373°C
Pressure > 220 bar

Magma Well Conditions:

Temperature 950°C
Pressure 165 bar
Online monitoring system, available to our customers
International market overview

 Project map & Markets

 Highlights for international market
Project map & Markets – Diversified operations

Offices
Projects
Pipeline
Highlights for international markets

Foreign projects
 All international projects are based on day rates.
 Azores Islands have so far been our largest international market.
 Recent works in Germany and Switzerland through our subsidiary HE.
 Several smaller projects in the past in Ireland, UK and Hungary.

Diversification
 Actively looking for new opportunities in Europe, which is our focus area.
 Other areas of interest include countries such as; New Zealand and Chile.
 Diversification into Oil and Gas (‘O&G’) projects. Some of IDC’s rigs are ready for O&G
drilling, besides we have a pool of experienced crew in O&G.

Projects/Pipeline
 Awarded projects in 2011 are in New Zealand, Dominica and Azores.
 Currently shortlisted for 2 drilling projects: one in Germany, and one in Chile.
 Pipeline projects in Germany, Turkey, Indonesia, Guadeloupe and New Zealand.
 Recently awarded drilling contract in Viborg, Denmark, planning to start in Dec/Jan 2011.
Summary and highlights
 Global expert in geothermal deep drilling.
 Well known and respected within the International Geothermal
Community. 1)

 Positive outlook for the geothermal industry.

 Increasing governmental support for renewable energy.
 International expansion opportunities.

 Modern, high tech rig fleet.

 Currently weak home market and growing international
operations.
1) Source: Survey conducted by Capacent Gallup on the perception
of the Icelandic Geothermal Energy Sector internationally – with some
view on individual company perception
Íslandsbanki, Nov 2010
 USEFUL LINKS:

 Iceland Drilling: www.iceland-drilling.com

 Hekla Energy: www.heklaenergy.com
 OR: www.or.is/English/
 Hitaveita Suðurnesja: www.hs.is
 Landsvirkjun: www.lv.is
 Iceland Deep Drilling Project: www.iddp.is
 Member of IADC: www.iadc.org
 Member of IGA: www.iga.is
Headquarters: Iceland Drilling Company, Hliðasmára 1, 201 Kópavogur, tel: +354 5855200 www.iceland–drilling.com

German office: Hekla Energy GmbH, Hunässtrasse 7A, 29227 Celle, Germany, Tel: +49 (0) 5141 349 210

New Zealand office: Ngahera House, 2283 Vaughan Road, Rotorua 3010, New Zealand Tel: +64 (0) 79299614