Mining Energy

The Netherland’s Mijnwater BV (private) is trying to start a trend, which is a tough thing for a company with a name that is in no way considered glamorous or intriguing enough to emulate.  The company has forged ahead with its mission to turn abandoned mines into an energy source.  The caverns of a defunct coal mine near Mijnwater’s hometown of Heerlen was the company’s first attempt at perfecting its ‘demand-supply’ system for geothermal energy from abandoned mine shafts.

The underground tunnels and caverns of abandoned mines eventually fill with groundwater.  The earth’s natural forces end up heating the lower depths.  The deep the mine shafts the higher the temperature of the water.  The municipality of Heerlen spent quite a bit of time and capital studying the potential for tapping the energy in the water to alternatively heat its community’s buildings in the winter and cool them during summer months.  With five well sites, the city built the first mine water geothermal plant in the world to provide power to a municipality.

Mijnwater’s system adds sophistication to the geothermal source by monitoring a variety of factors such as weather forecasts, customer demand and the day-to-day availability of energy from other renewable power producers.  It is a fully automatic, demand-driven system with the capacity to deliver heating and cooling water at any time.  The control system has helped make the mine geothermal source a permanent part of Heerlen’s energy scheme.

The success in Heerlen has not gone unnoticed in other parts of the world.  In the United States and Canada the projects are far less grand.  Geothermal heat from an abandoned coal mine in Springhill, Nova Scotia has been used to heat and cool a plastics manufacturing plant since 1989.  Marywood University in Pennsylvania uses geothermal heat from a mine to warm up its Center for Architectural Studies.  There is a church in Pittsburg that is optimally heated and cooled by water from very old mine shafts just below.  A two-story municipal building in Park Hills, Missouri likewise benefits from close proximity to an abandoned mine filled with water. 

The U.S. Department of Energy, when still run by people who cared about the future of our citizens and were not focused solely on lining the pockets of fossil fuel companies, completed a study on the potential for mine geothermal energy.  The conclusion was that the 500,000 abandoned mines in the U.S. were a promising source of energy.  Defunct coal mines would be particularly good candidates for exploitation because they are more accessible.  It seems most of the mines are already filled with water. 

The Environmental Protection Agency took the concept one step further and identified 72,673 sites that are considered contaminated and therefore suitable for nothing else but geothermal energy.  At least 1,738 of these sites have sufficient temperatures greater than 150 degrees Fahrenheit that could be good candidates for enhanced geothermal systems.

Mijnwater BV is the only private company to percolate to the top in this potential new sector of mine geothermal energy.  It would be wonderful to suggest that it is likely a counterpart will emerge in the U.S. or Canadian markets. No investor should hold their breath for this development.  There may be other entrepreneurs in Europe who will move forward with this opportunity, but in the U.S. where politics rather than intelligence dominate investment decisions, there is not likely to be anything movement for some time to come. 

We expect U.S. energy officials to make excuses about the lack of knowledge and unproven nature of mine geothermal energy in order to forestall exploitation of this renewable energy source.  It is a threat to the fossil fuel interests that wield inordinate influence in the Trump Administration.  There is considerable evidence to the contrary and that cannot be erased by political pandering.  The engineering and construction services firm Greenman-Pedersen, Inc. help Marywood University install and commission its geothermal heating/cooling system.  Jacques, Whitford & Associates Ltd., now Stantec (STN:  NYSE or STN:  TSX) was instrumental in the plant that now benefits the Town of Springhill in Nova Scotia.  The fact that two ordinary EPC firms could install and commission quite effective systems is a testament to the manageability of mine geothermal energy. 

Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein.