German drilling firm Daldrup offering an integrated risk insurance model

Drilling rig on site in the Netherlands (source: Daldrup & Söhne AG)
Alexander Richter 10 Apr 2017

German drilling firm Daldrup & Söhne AG has announced a new integrated risk insurance model as part of a recently signed drilling contract for a geothermal project in Bavaria, Germany.

As part of an announcement of a recent new drilling contract we reported on earlier, Daldrup & Söhne AG – a German drilling contractor and energy company – announced a new integrated risk insurance model for drilling.

In the geothermal project Geretsried in the south of Munich, Daldrup & Söhne AG is using the alternative risk transfer (ART) structure as a new drilling contractor in Germany for the first time in Germany, according to the company’s press release.

The Enex Geothermieprojekt Geretsried Nord GmbH & Co. KG awarded the contract for two geothermal drillings at the Geretsried site to the company Daldrup & Söhne, using an integrated insurance model, which has already been successfully tested in the Netherlands. It has now been used in Germany to hedge the risk of discovery risks developed by Daldrup & Söhne AG. The ART structure is an integrated backup model that enables geothermal drilling and energy projects within a reinsurance structure by being financed through debt at an early stage in the project.

In addition to hedging the liquidity risks, the capital requirements of the clients are significantly reduced during the search phase. Enex finances the energy project with the involvement of an international bank.

In cooperation with the BMWi research project “Dolomitkluft”, the 6,186 meter long bore, which has reached a temperature of 160 degrees Celsius but has not found sufficient depth of groundwater, is to be used economically in Geretsried. For this purpose, the geothermal reservoir of the Oberjura is to be connected by means of a sidetrack from the existing main borehole via a modified drilling path. A second well is to open the reservoir at a depth of 4,900 m. These plans are based on geological and seismic preliminary investigations as well as gained knowledge from the drilling drilled in 2013. The results show structures that allow the assumption of sufficient water quantities. If such a finding is given, Enex plans to erect a geothermal power plant.

Josef Daldrup, CEO of Daldrup & Söhne AG, explains: “The geothermal energy project in Geretsried is the first integrated project of this kind in Germany, with the successful implementation we have an exemplary reference project in the Netherlands. We assume that we will acquire further geothermal energy projects with our ART structure in Germany as well as in our European neighboring countries. Geothermal drilling – including the first drilling that carries the highest risk – is for our equity capital investors and banks with our ART structure Can be backed up right from the start. ”

This is a news piece published by our German partner site