Geodyn Solution: Integrated Investment in Nebraska with Hydrogen and Helium Exploration and Extraction
Geodyn Solution proposes a $650 million investment in Nebraska to establish an integrated facility combining hydrogen and helium exploration and extraction, hydrogen production, helium extraction, ammonia production, and a 1000 MWh electric plant with Organic Rankine Cycle (ORC) and heat recovery systems. This project leverages Nebraska’s natural resources and operational synergies to deliver strong financial returns over a 10-year period.
- Total CapEx: $650 million
- Annual Revenue: $145.7 million
- Annual OpEx: $60 million
- 10-Year ROI: 131.8% (13.18% annualized)
- Payback Period: 7.6 years
- NPV (5% discount rate): $184.6 million
This diversified approach ensures multiple revenue streams, enhances efficiency, and positions Geodyn Solution as a leader in clean energy and industrial gas production.
Project Overview
Objectives
- Explore and quantify hydrogen and helium reserves in Nebraska.
- Extract hydrogen and helium efficiently for commercial use.
- Integrate ammonia production and electricity generation with exploration and extraction.
- Maximize ROI through strategic capital allocation and cost management.
Components
- Hydrogen and Helium Exploration: Geological surveys, seismic studies, and test drilling.
- Hydrogen Extraction: Electrolysis powered by renewable energy.
- Helium Extraction: Cryogenic separation from natural gas.
- Ammonia Production: Haber-Bosch process using on-site hydrogen.
- 1000 MWh Electric Plant: Combined cycle gas turbine (CCGT) with ORC and heat recovery.
Technical Design
1. Hydrogen and Helium Exploration
- Activities:
- Geological surveys and seismic studies to locate reserves.
- Drilling test wells to assess reserve size and quality.
- Technology: Seismic imaging, exploratory drilling rigs.
- Purpose: Confirm resource availability for extraction planning.
2. Hydrogen Extraction
- Technology: Proton Exchange Membrane (PEM) electrolysis.
- Capacity: 10,000 tonnes/year.
- Power Source: 50 MW solar farm.
- Purpose: Feedstock for ammonia production and power plant fuel.
3. Helium Extraction
- Technology: Cryogenic separation.
- Capacity: 1 million cubic feet/year.
- Source: Natural gas co-production.
4. Ammonia Production
- Technology: Haber-Bosch process.
- Capacity: 50,000 tonnes/year.
- Inputs: Hydrogen from electrolysis, nitrogen from air separation.
- Synergy: Utilizes waste heat from the electric plant.
5. 1000 MWh Electric Plant
- Technology: CCGT (500 MW) + ORC (50 MW).
- Heat Recovery: Heat Recovery Steam Generator (HRSG).
- Efficiency: ORC converts low-grade heat into additional power.
Operational Synergies
- Waste Heat: HRSG steam supports ammonia production, cutting energy costs.
- Resource Use: Natural gas powers the plant and aids helium extraction.
- Electricity Boost: ORC increases output and revenue.
- Data Utilization: Exploration data optimizes extraction strategies.
Detailed Capital Expenditure (CapEx)
Exploration CapEx
- Geological Surveys and Seismic Studies: $10 million
- Test Drilling (5 wells): $15 million
- Permits and Environmental Assessments: $5 million
- Total Exploration CapEx: $30 million
Extraction and Production CapEx
- Hydrogen Extraction (Electrolysis Plant): $100 million
- Helium Extraction (Cryogenic Separation Plant): $50 million
- Ammonia Production Plant: $150 million
- 1000 MWh Electric Plant (CCGT with ORC & HRSG): $200 million
- Infrastructure (Pipelines, Storage, etc.): $50 million
- Land Acquisition and Site Preparation: $20 million
- Total Extraction and Production CapEx: $570 million
Total Project CapEx
- Exploration CapEx: $30 million
- Extraction and Production CapEx: $570 million
- Contingency (5%): $30 million
- Total CapEx: $650 million
Operational Expenditure (OpEx)
- Exploration Maintenance: $2 million/year
- Hydrogen Extraction: $10 million/year
- Helium Extraction: $5 million/year
- Ammonia Production: $20 million/year
- Power Plant: $15 million/year
- General Operations and Administration: $8 million/year
- Total OpEx: $60 million/year
Revenue Streams
- Hydrogen: 10,000 tonnes × $2,000/tonne = $20 million/year
- Helium: 1 million cf × $0.2/cf = $0.2 million/year
- Ammonia: 50,000 tonnes × $500/tonne = $25 million/year
- Electricity: 1,000,000 MWh × $100/MWh = $100 million/year
- Exploration Data Sales: $0.5 million/year
- Total Revenue: $145.7 million/year
Exploration Reserves
- Hydrogen: 100,000 tonnes (10-year supply).
- Helium: 10 million cf (10-year supply).
Financial Projections
ROI and Payback Period
- Annual Profit: $145.7M – $60M = $85.7 million
- Payback Period: $650M / $85.7M ≈ 7.6 years
- 10-Year Cumulative Profit: $85.7M × 10 = $857 million
- 10-Year ROI: ($857M / $650M) × 100% = 131.8%
10-Year Cumulative Cash Flow
Year | Annual Profit ($M) | Cumulative Cash Flow ($M) |
|---|---|---|
0 | -650 | -650 |
1 | 85.7 | -564.3 |
2 | 85.7 | -478.6 |
3 | 85.7 | -392.9 |
4 | 85.7 | -307.2 |
5 | 85.7 | -221.5 |
6 | 85.7 | -135.8 |
7 | 85.7 | -50.1 |
8 | 85.7 | 35.6 |
9 | 85.7 | 121.3 |
10 | 85.7 | 207.0 |
Net Present Value (NPV)
- Discount Rate: 5%
- NPV: $184.6 million
Risk Management
- Exploration Risks: Advanced imaging and phased drilling reduce uncertainty.
- Market Risks: Diversified products buffer price volatility.
- Technical Risks: Robust R&D and maintenance plans.
- Regulatory Risks: Dedicated compliance team.
Sustainability
- Renewable Energy: Solar-powered hydrogen production.
- Efficiency: Heat recovery minimizes waste.
- Compliance: Adheres to environmental standards.
Conclusion
This $650 million investment integrates hydrogen and helium exploration and extraction with ammonia production and electricity generation, delivering a 10-year ROI of 131.8%, a 7.6-year payback period, and an NPV of $184.6 million. It offers substantial returns and strategic market positioning.
