126: Matthew Houde | Co-Founder Of Quaise Energy - The Solution To Deep Geothermal

🎙️: https://atlasgeographica.com/matthew-houde/

The following is a conversation with Matthew Houde. 

Matthew is the co-founder of a business that is developing a new drilling technology that could allow the world to access the deep geothermal heat beneath our feet.  This is best consumed alongside the episode with Carlos Araque, Matthew’s co-founder at Quaise energy.

The subject of geothermal energy is deeply interesting to me. I think it could well be one of the most important disruptive innovations of this generation and it is precisely companies like Quaise who could be the winners from this disruption. 

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• 00:00 – Introduction
• 01:24 – Quaise Start-Up Story
• 08:24 – Geothermal Versus Solar & Wind
• 15:46 – Why Geothermal Matters
• 23:50 – Who Is Carlos Araque + Stories In Raising Money
• 31:48 – Quaise Technology (Part 1)
• 34:45 – 2nd, 3rd, 4th Order Consequences Of Success
• 44:13 – Quaise Technology (Part 2)
• 1:06:14 – Problems With The US Grid
• 1:12:09 – Quaise Timeline
• 1:16:28 – Geothermal In The Media & Thoughts Of The Competition
• 1:26:02 – Country Mattew Houde Is Bullish On
• 1:28:58 – Conversation Between Any Two People Of History

🍻☕: https://www.buymeacoffee.com/ryanhogg

Curious Things Mentioned During The Episode

• Carlos Araque – Co-Founder Of Quaise Energy
• John Redfern – CEO of Eavor
• Alexander Richter – CEO Of ThinkGeoEnergy

Transcript

SPEAKER_00 0:00

The following is a conversation with Matthew Hood. Matt is the co-founder of a business which is developing a new drilling technology that could allow the world to access the deep geothermal heat beneath our feet. This is uh podcast best consumed alongside episode 94 with Carlos Araque, who is Matthew's co-founder at Quase Energy. The subject of geothermal is one deeply interesting to me. I reckon it could well be one of the most important disruptive innovations of this generation, and it is precisely companies like Quase who could very well be the winners from that disruption. This episode was an absolute thrill to record. Matthew and Carlos together make for the best communicators in the geothermal space. And so if you are interested in understanding the geothermal bull case in full, then you simply must consume both of these episodes together. Among other things, in this chat, Matt will talk about the Quays founding story, plus as well his uh admiration for Carlos Arake, the importance of geothermal energy, the Quays technology, which, spoilers, is microwaving rocks into dust, and much more as well. However, before we get into it, this podcast took me five hours to put together, but will only take you five seconds to review. So do your duty, swipe up those phones and pump your good juice into the algorithm with five stars. And with absolutely no further ado, here is the brilliant Matthew Hood. So how did you and Carlos start up Quase?

SPEAKER_01 1:27

Yeah, so this dates back to around 2018. Uh at this time, I personally was a grad student at Stanford. Uh I'd gone to not just Stanford, but grad school in general because I knew um that renewable energy was the industry I wanted to push forward with with my career. Um, just exciting, incredible opportunity to solve the most pressing challenges this century, I think, we have to face the global civilization. Um, while I was there, I became familiar with the geothermal program and found it to be really just, for lack of a better word, interesting to me at a real personal technical level. I had an undergrad background in geoscience and geological engineering. So I always enjoyed problem enjoyed problems that involved the subsurface and especially anything that involved these challenges with just to do with geology and rock mechanics, sort of where the two disciplines intersect. And uh saw very quickly that of course geothermal fits that niche like a glove if you're wanting to do that in in the energy space. Um, just really interesting, you know, technical problems to solve. Um, I think one thing that also really appealed to me with geothermal was learning about where it stood today in terms of its presence and how there was, it seemed a lot of room for technology growth and innovation for geothermal to scale uh to a much greater capacity than where it is currently. Uh, I think when I was entering grad school, this was really right around the time that we saw all these extremely low-cost wind and even solar farms beginning to come online where really uh the technology, it seemed, was fully, fully mature. And it's a matter of sort of the commercial maturity and continuing to scale and integrate those systems where uh sort of the interesting problems to solve are today. But with geothermal, there was this huge white space in terms of where the technology could go for harvesting this energy resource at a much greater scale, and I just saw that as a really interesting sort of field to dig into. Um, so I took several of the courses within the um geothermal department at Stanford within their energy resources engineering department. Uh, at the time I also did an internship with Ormat, which is the largest private developer of geothermal worldwide. Uh, really exciting to see how the exploration and resource development process goes on at a company like that that's involved, you know, as a vertically integrated company, is involved in pretty much all aspects of developing a geothermal field and operating it for selling power back onto the grid. So I got a lot of great exposure, even just as a technically as an intern within as a geologist within the resource team, really seeing all the other different pieces Ormat's doing, you know, in terms of bringing these geothermal resources online, which in their context is mainly harvesting these lower to moderate enthalpy uh hydrothermal or naturally occurring geothermal systems with uh binary power plant cycles. Um, after that internship with Ormat, I got back to Stanford and I was actually uh came across uh an advert from Altaro Energy uh that was looking to begin uh projects sort of under this umbrella of super hot rock. And I'd come across this concept uh earlier at Stanford uh through a fellow uh coast student of mine who uh had mentioned you know some of these Icelandic deep wells, the IDDP projects, um which I didn't really know the full name at the time. Um, how these wells had tapped into these very high temperature resources where water is super critical. I think this is before I even knew what supercritical was. And essentially there is a really exciting potential for the power output that could be generated per well, that these wells can have this tremendous power density that's up to an order of magnitude, potentially more than conventional geothermal wells that are in operation today. And I had seen some papers on it going to the uh GRC conference that year. Um, really, you know, exciting at the time, a lot of these projects coming online worldwide. And Altarock, it turned out, was the sort of US private company really interested in not just developing this super hot concept, but also looking at how it scales um beyond sort of these shallower, naturally occurring hydrothermal systems where a lot of the supercritical projects were going on uh globally, like the IBDP projects, for example. So I saw that they've obviously had the mind of not just really tapping into this exciting potential, but also looking at how it scales beyond sort of the niche locations that geothermal is constrained to traditionally. And so I got looped in with Altarock, and at the time they had been in discussion with a research at the MIT Plasma Science Infusion Center, Paul Waskoff, who had came across geothermal about 10, 15 years ago, and having decades of experience in fusion research, saw that there were some technologies that could transfer over into solving the challenge of deep geothermal drilling. And that is where the millimeter wave drilling concept comes about, which I can get into here later. Uh, but at the time I was really intrigued on helping out with Altarock in terms of exploring this drilling concept in terms of how we can get it funded, scaled up. At the same time, uh, Altarock and uh CEO there, Aaron Mandel, had actually connected with Carlos Raque, who was at that time at MIT Z Engine Accelerator, uh just starting actually, uh, learning about venture capital and how transformative energy projects can be scaled up in the in the private sector from the ground up. And Altaroc was really the sort of key thread here that connected me and Carlos. So we uh got together and figured out a means to uh really advance the next stage of technology development, which was going to require government funding for these higher power lab experiments that scaled up beyond what Paul was able to achieve at MIT with the equipment available to him through this proposal writing. This is how Carlos and I uh got introduced, um got to know each other and realized we were very passionate about the same problem, which is scalable geothermal, uh, bringing that into our solution space for the energy transition, and eventually came to the point where it made sense that this was going to be not just a standalone project, but its own company. And so Quase really gets born in the midst of that sort of process of coming up with uh proposal being written for RPE agency within the US Department of Energy uh to fund these experiments and also looking in terms of how we raise that additional funding through the private sector.

SPEAKER_00 8:17

Amazing, what a comprehensive answer. Um take me a little bit back to earlier in it. You mentioned that um you wanted to tackle something within renewable energy because you know it's a great call to action. Could there be a better problem to solve? Especially for a you know, an engineer. Um at the time solar and winds were getting all the attention, you could say they still do get all the attention. Why not go into one of those fields where there was a more say clear path?

SPEAKER_01 8:49

Yeah, I think it's a few areas, and one is just I think it in terms of interest, the way that I was seeing this as a grad student at the time, and granted, I think now being a bit older, can see there is some space for some smaller technical innovations that continue to improve the efficiency, output of these projects, continue to bring down cost. But it just seemed to me that a lot of the real technology development had had already taken place. We have, you know, you look at the wind turbines going up today and new solar panels going up, and they're not dramatically different in the technology from five, 10 years ago. It's a pretty standard design, similar manufacturers. It's mostly the improving the economies of scale that are really pushing forward the growth in these uh new technologies for wind and solar development, not necessarily the technology. So I think I was a bit dissuaded from you know seeing it, you know, getting into that space that it wasn't going to be as compelling to me at least to be involved in sort of this technology development from something, you know, that's say starting in the lab in the context of what we're doing here with millimeter wave drilling and bringing that to full fruition of commercial deployment was really the sort of uh area, you know, the energy transition I really wanted to get involved in. I think also it was becoming clear as I was in grad school and learning a bit more about the grid and you know what the challenge was for meeting our energy demand with fully 100% renewable energy, that there was going to be significant challenges in addressing that need with a solution that only relies on wind and solar energy. I think the limitations there are fairly well known. These are intermittent resources that have to be balanced with additional capacities such as dispatchable firm resources that are able to modulate their power output, as well as varying scales of storage technologies that can actually arbitrage when these intermittent resources are producing the most energy to redeploy that power back to the grid when it's most needed. And so it was really apparent that there was a need for, in particular that former category, some clean, dispatchable technology that can really complement some of the challenges wind and solar faces for uh providing a 100% reliable clean grid. Um, I think also there were additional challenges beyond the simple supply-meet-demand problem with the energy transition that really drew me to geothermal as a solution there. One of which is looking at in terms of balancing the sort of requirements for these more dispersed resources like wind and solar for much more land and much more materials, specifically in the materials in the lines of specific minerals and metals that are also similar to fossil fuels today, constrained uh heavily due to certain countries. And so there are more sort of holistic challenges to delivering this 100% renewable energy system beyond just meeting supply and demand, such as how much land is going to be required by this new energy system, and how are you going to make sure that supply chain is met by the various new, and in case a lot of these wind and solar technologies, more exotic minerals and metals that are much more harder to find being available across the globe entirely. And so it just seemed that geothermal is a really just fits the glove like a hand in terms of uh balancing some of the limitations that a wind and solar system would be able to deliver, relying only on those two sources of energy.

SPEAKER_00 12:29

Did it ever feel risky um going after geothermal? Presumably you had a lot of good options at your feet, but you went for this. Now, in hindsight, I suppose it makes sense since there's so much attention and money going towards geothermal, but in 2018, or that was, I suppose, 2015, 16, did it feel risky?

SPEAKER_01 12:48

It definitely did, I would say. I think my thinking at the time was that the US geothermal growth was gonna kind of was in a very challenging, risky scenario. There was not really much on the near-term horizon for how geothermal is really going to um scale up or continue growth. And this was again at the time where especially wind and solar were coming online at a rapid pace. I think that was a common thinking in geothermal space, was that you know, kind of the the arms race, so to speak, is who's going to get to the lowest cost. Uh, wind and solar had won the battle, so to speak. Um, although it should be looked at that way. These aren't competing energy resources, they're complementary. Um, at the time, I think I was more keen on some of where the global development could be, because there is still a lot of naturally occurring hydrothermal resources globally that are untapped and can also can actually meet substantial energy needs for a lot of these communities and countries, granted that so much of the world's population tends to live near the types of tectonic areas whereby whether you know you have local volcanism or magnetism or you have structurally structural reasons for why there's an elevated geothermal gradient, there's actually quite a bounty of naturally occurring geothermal um potential that's still undeveloped. Um, but I would say definitely thinking of you know wanting preferring to stay and work in the States, um, it looked like it would be a bit risky. And I think it that in itself kind of um probably helped me make my decision towards really fully committing towards this kind of crazy idea coming across my way from Altaroc in terms of basically replicating a scene from Star Trek for trying to drill for geothermal energy. It was like, well, yeah, not much to lose here, so might as well go for it.

SPEAKER_00 14:33

Yeah, just just wait, dear listener, until we get into the uh you explaining the technology of all this. It truly is out of Star Trek. But um, how does it feel now? Almost ten years later, you're a co-founder of what could be a generational company, assuming that you solve the um the problem that you've set out to solve. I mean, we're talking trillions of dollars of value created. Um, yeah. How do you how do you sort of reflect on the the risk you made then? Does it feel like it's paid off, or there's a still a long way to go before it's paid off?

SPEAKER_01 15:11

More so, I think even just to today, I could never imagine like my career post-school turning out as well. And it is, I'm eternally grateful for the sort of privilege and opportunity that that came about because so much of it was just the timing of things. Um sounds very serendipitous. Exactly, exactly. It really feels this is you know what everything kind of had would have led up to between my school and work experiences, and just again, the problem we're trying to solve and the potential, as you outlined there, is so so enormous, it's uh pretty easy to wake up every day and be uh very very very excited about getting to work.

SPEAKER_00 15:46

All right, so almost 10 years since you discovered this idea of geothermal. Could you just now give the most compelling reason for why geothermal is an important uh area that people should pay attention to?

SPEAKER_01 16:01

Yes. The Earth is a massive battery in the terms of the heat that's stored in the subsurface, what we refer to as geothermal energy. When we think about it, you know, as it's been done today, we tend to think about things like geysers, like old Faithful erupting at Yellowstone, and basically these naturally occurring geothermal systems that, as I previously touched on, there are there is a lot of potential for, but ultimately don't do full justice for how massive and importantly, in my opinion, universally accessible this geothermal resource is. I mean, you can go anywhere on Earth, and if you drill deep enough, you're going to hit very high temperatures. And higher temperatures you can go, and the more flow you can get out of a well, the more power output you can deliver from these geothermal reservoirs, whether they're naturally occurring or the context of what we're interested in, we go into what we call hot, dry rock systems and develop through either EGS or closed loop a more novel engineered means for harvesting that heat from the subsurface. So it's this massive, massive energy resource. I mean, literally in terms of joules, it's somewhere on I think the order of one to ten billion times our annual energy demand. So it's you know, a fraction of a fraction of a percent of that is what can meet our current energy needs. And importantly, it complements a lot of the solutions available today that are commercially mature for actually transitioning to a 100% zero carbon energy system. Again, it's a reliable baseload resource that can also be operated in a more firm, dispatchable manner, however you choose to engineer it. Uh, you have this balancing of sort of the materials and land requirements that wind and solar have. I think really the most appealing aspect to geothermal as a clean energy solution to me is the accessibility and some of the challenges it can answer in terms of ensuring everyone in the world has access to not just clean energy, but also just access to energy, period. It is such a key enabler of development and helping so much of the world raise their income and improve their standard of living. And importantly, it's an energy resource that they do not have to be necessarily dependent upon global supply chains that can perhaps be more fickle, and importantly, controlled and dictated by a few energy, you know, countries with much much larger potential of energy resources. It's actually something that can be developed locally and provide that universal access to energy that I think is so important for development and you know, determining our own destiny, for lack of a better word.

SPEAKER_00 18:43

So yeah. That's that's for me the most compelling part of the argument. It um takes away any type of energy dependence, assuming Quase delivers, you can dig deep enough really anywhere that it would make each country uh give them at least the potential to be energy independent, assuming they can go deep enough. But um go one step further, Matt. Give me the most hyperbolic use case of geothermal energy if your daydreams go exactly as you plan. What does the world look like?

SPEAKER_01 19:18

Yeah, so I think there's an obvious need where geothermal fits in again as this complement to wind and solar as being our primary sources of clean energy, um, primarily through its systems mostly electrified, but also certain cases, of course, where there's a lot of heating being directly met by this geothermal resource. I also like to think there's a new, more novel deployment of how geothermal provides not just power, but other more industrial use cases. I think what's very, very appealing to me about geothermal compared to wind and solar is that it's obviously not just a source of electricity, but it's also a source of heat. And when we are, if we are able to tap into these much higher temperatures of say exceeding 400 degrees Celsius, there is a bounty of different varying industrial heating applications that geothermal can serve in addition to being a source of primary energy for electricity and heat. So, one, just to give an example, because it was in the news last week, and I'm very excited about it, is this project that Fervo announced, uh, where they are looking at a sort of co-production geothermal facility that also does direct air capture. Direct air capture, one of its, it's a big energy consumer. It's going to need a lot of heat. And with geothermal, you're providing both the power and the heat directly on site to vastly improve the economics of direct air capture. And also, I think improving the operation of a geothermal plant because now you have multiple applications to deploy that energy to beyond just wholesale electricity sales to the utility or grid at large. Um, this is just one example of you know, you can think of hydrogen co-production, desalination, uh, the Salt and Sea projects that have gotten a lot of uh interest and exciting progress in the past few years looking to co-produce lithium for the geothermal brine. It's a variety of sort of co-productive capacities that geothermal can deliver in addition to energy sales. And I like to think that there's a model for energy development for the world, especially in countries that don't have these developed mature energy systems, even fossil fuel-based energy systems, that they can actually not just deliver their own local energy, but it's almost like a local industrialization in a box. In other words, you know, they have ability to deliver all this industrial manufacturing capacity if they would need to, through a geothermal resource that they could tap into locally by taking advantage of that energy and heat on site. So that's my far out use, you know, hyperbolic case for what geothermal could look like in 50 years.

SPEAKER_00 22:00

Is is that is that the is that the most optimistic timeline or is that more of a realistic timeline?

SPEAKER_01 22:06

Oh, I wouldn't put the timeline too much in there. I think um optimistically, and actually I would say, you know, I think within the next ten years we want to bring supercritical geothermal online, and so within next thirty years, I would definitely say, you know, this is where maybe this hyperbolic case could be could be applicable here. It's gonna be contingent, of course, on hitting our technical milestones here in the next 10 years. But I'm confident to get it done.

SPEAKER_00 22:32

Just between you and me, how confident are you in the technology to be able to dig 15 kilometers deep through rock?

SPEAKER_01 22:40

So far, so good. Um, you know, I think like anything, you know, it's not just that we are proposing to do a service that is, say, directly better and comparable to what conventional drilling does today. We're actually trying to basically break a world record for drilling, and we want to do that hundreds, if not thousands, of times, drilling these super deep boreholes that would regularly be exceeding the depth of the deepest hole on the planet today. So I think putting in that lens, of course, it's gonna be a risky endeavor. There's gonna be challenges that rise up that are gonna be hard to solve. And I can think of ones right now, today, that we are working on that uh very much I think would be a, you know, are gonna be a non-trivial matter to solve. Um, but importantly, um like any sort of science project, we have not found the problems being unanswerable. In other words, there's nothing science sort of level, or even a lot of these engineering challenges necessarily that is saying this is a showstopper and you're not gonna be able to do this. It's more so just getting out into the lab and especially into the field and beginning to execute and making sure we deliver good holes while at an economic cost.

SPEAKER_00 23:51

Go back to the opening question about meeting Carlos. Um tell us a little bit about uh Carlos Araque.

SPEAKER_01 24:00

Yes, yeah. I met him briefly in person the first time, I think, in Boston, summer 2018. Um I think it was one thing that kind of appealed to me because this was a new meeting with a lot of new people I hadn't met before in person yet from MIT and Alterac and Carlos. Um one thing that struck me was that this meeting was about, you know, say three to four hours, and I noticed he was very much listening. I I don't think he necessarily, you know, chimed in or interrupted or anything, but he was very much just taking it all in. And I've learned that's a trait of his that I very much admire and learned a lot more about, I think, in months and years following, is that he's a very attentive listener and does not, you know, one of these people that seeks a need to say, chime in or interrupt when there's nothing uh relevant to say or, you know, not to take away from focus of the discussion. And the more I talked with him in the months following that and founding Quaze, I really grew to admire one, what's I think Gabby's talking to him is his his knowledge and his ability to think of these engineering problems in a sort of first principles-based approach from the ground up. Uh, being a younger student fresh out of college, that was a kind of an eye-opener to me in terms of how you can look at these big technical science engineering challenges, is that no matter what your background or level knowledge is of something, even if you're just coming across it, you can begin to figure things out and figure out, you know, roadmaps and how you answer these questions when you start thinking of these things from a first principles approach and reason from what you know is true in terms of, you know, say conservation of energy, dealing with fluid mechanics, and looking at, you know, what are the real requirements for energy requirements for actually vaporizing a hole into rock at a size sufficient for a geothermal borehole. You can start to answer those questions to yourself and actually show that, oh wow, I think this actually could work. And so um, I obviously gleaned that a lot from him that he had this very, you know, well-reasoned approach to thinking through these challenging questions. But again, I was very, very um impressed and grateful to just hear how, you know, first early discussions with him, he it was very much a uh a listening, you know, uh back and forth exercise, and that he was very much um, you know, very very I was very appreciative of the way that he sort of uh guided me through thinking about this millimeter wave drilling question and challenge, and knew that this is someone that uh when it came to starting this new company, Quase, this is absolutely the person I want to dive into. And given he has this experience from Schlumberger working in product development over 15 years, he knows you know how these challenging big technical projects get delivered from start to end. And so that gave me a lot of confidence. I'm working with someone that sees how something like this can actually be put into practice stuff.

SPEAKER_00 27:02

And what's the division of labor between the two of you?

SPEAKER_01 27:05

Yeah, I like to think of us like the um oh gosh, I might have to send you the revision after because I don't know if I'm getting the name right, but I believe it's the Roman deity uh Janet, uh the one that has the two faces there's the external face and the internal face. And so I think Carlos very much being not just the face of the company's CEO, but also being the real leader on the fundraising effort, he is constantly having to do very much the external facing of quays and obviously guiding us, you know, in terms of high-level what things need to be, you know, handled at an organizational level, you know, growing as a startup into a larger company. Uh that gives me a lot of freedom, I think, internally to focus on a lot of you know the areas that are challenging at the sort of engineering and science level, um, helping thread you know some of the efforts going on between our various teams and being a company also that's distributed in a few locations, too. Um, I get the opportunity to be able to play that sort of internal glue role uh within within Quase that I'm very grateful for that Carlos handles a lot of the more challenging efforts, uh raising capital, which is always the uh keeps the lights on at night, keeps us going. Maybe the most important thing as an early stage startup.

SPEAKER_00 28:20

And so far, how much capital have you guys raised?

SPEAKER_01 28:23

Yes, I believe total is 72 million in private capital. That may or may not include uh the five million dollar award from RPE that funds Quase in addition to several of our collaborators on that project. Uh, but 72 million, of which 52 million was raised last year in our Series A and Series A extension.

SPEAKER_00 28:45

And how does that money get spent?

SPEAKER_01 28:48

A lot of a lot of equipment for certain. Um, definitely uh we are working with high power specialized one-off research equipment as gyrochuns and company equipment have been built for today. Um, and so a lot of that equipment can be a bit expensive. Um, that was a big reason why we had to raise the round that we did to really just get the purchases going on acquiring this equipment for ourselves that are able to mobilize into a field setting and do our testing or be able to keep within-house and testing. That was something we weren't able to do in preceding years. And so uh we're very grateful for collaborators like Oak Ridge that have been able to provide access to their gyrotron equipment to proceed with our testing without that purchase equipment. But a lot of the private fundraising has gone towards uh procuring that equipment, key equipment for the next stage of development and also building out our teams. We have an engineering team based in Houston, um, a lot of which is coming from the oil and gas sector. Um, so that team has grown very rapidly in the past two years. I want to say it's you know from about four people to now 2022. Um, so uh a lot of financing going towards increasing the headcount and the sort of productivity of our quase as a whole towards really pushing forward this technology.

SPEAKER_00 30:16

And um how much stuff are you building from scratch?

SPEAKER_01 30:23

Yeah, so uh some of these, you know, especially the gyrotron and the key really the key novel technologies that are being acquired, these get purchased through commercial vendors. Um we are also working. Yes, gyrotron is the source of our microwave energy. It generates microwaves at typically around 30 to 300 gigahertz, which is one to ten millimeters in wavelength. So that's why we refer to it as millimeter wave drilling. But the the gyrotron is really the key enabler here because it's able to generate electromagnetic radiation at the power levels and frequencies that are needed for delivering enough energy across several kilometers downhole to vaporize rock. And so these gyrotron devices today are built by only a handful of vendors worldwide. Um, typically they have been built and actually they were initially conceived about 60, 70 years ago for nuclear fusion purposes where they want to use microwave energy at these frequencies for heating a plasma up to the temperatures needed in a tokamak for uh fusion reaction to take place. Um, in the sense we're both using microwaves to heat material, but um instead of plasma in this context, now we're heating rock instead.

SPEAKER_00 31:46

And I I I I understand there is gonna be a um an instinct from you to be really humble here, but I'd I I'd love to know just how bleeding edge is the engineering and the physics that uh you, Carlos, and your team are tackling here. Is uh is it right on the edge where it requires uh almost like creativity in your thinking, or is there a body of work that you can refer to uh in trying to solve these problems?

SPEAKER_01 32:20

It's a good question. It's it's a combination of both, to be honest. I think the fusion technology, as it stands again, it's been around for 60, 70 years, and so there's pretty well-established theory and manufacturing processes and implementation in terms of putting these gyrotron um devices together within an overall fixture, including what we refer to as a waveguide transmission line that serves as a conduit for the microwaves, um, putting that all together for these fusion experiments. And so we don't have to reinvent the wheel in terms of the gyrotron technology or the waveguide technology. However, deploying those technologies in this rugged field application for geothermal drilling is very novel. And so everything we are doing on integrating these within a drilling rig and building components that are compatible both in the field and especially for components going downhole in the rough, rugged borehole environment, it's fairly novel in terms of using that technology for those purposes. And I'd also note that there is very little, not just say, um, engineering sort of work, but even basic, more fundamental science research into um, well, not just using microwaves to heat and vaporize rock, but literally the sort of information on rock vaporization, you know, how how rock um at different varying pressures and different rock compositions, you know, how that vaporization process uh takes place, at what temperatures and what components are going to come off, you know, be liberated from this rock melt first. It's a fairly poorly understood space. Provide an example when Paul initially started his research back about 10 years ago, when he went digging for rock vaporization data, the really only area you would find this is in ablation studies for meteors coming through the atmosphere. So it's a pretty novel field of research Paul had to dig into just to get some basic, you know, kind of order of magnitude assumptions on the properties of rock at these vaporization temperatures. So there's a lot of science here. There's very very bleeding edge, and just in general, um, using microwave energy to vaporize rock in the fashion that we're doing is is entirely novel and certainly requires some requires some cutting tech and thinking on our side, I would say.

SPEAKER_00 34:46

Um I I know by its very nature it's almost impossible to know or predict, but what do you suspect might be second, third, fourth order consequences from breakthroughs in the technology that you're pursuing?

SPEAKER_01 35:01

Yes, so I think definitely, I think geothermal as a whole, um, it will be a very um significant step to say that we have a drilling technology now that unlocks these depths and temperatures that were previously considered uneconomic for any sort of geothermal harvesting. Um, you know, I like to mention that the Geofission report that the U.S. Department of Energy wrote and published back in 2018, they had a brief one-page blurb on super hot, supercritical geothermal systems, and noting that you know, this is a massive resource in terms of the potential. However, beyond a few niche locations where you can tap into these temperatures below or above five kilometers depth, these temperatures are very deep, and we do not, you know, they're basically financially prohibited to access with conventional drilling technologies. And so we aren't even considering them as part of this analysis. I think with this drilling technology, if we have success, that assumption there changes greatly. And all of a sudden, now there's a sort of whole new space in our subsurface that is economically accessible for geothermal deployment. Um, I'd say also I think there is a variety of use cases that we are exploring that involve um hard rock destruction, where our drilling approach could be could be advantageous, that could certainly have um some strong sort of second-order applications beyond deep geothermal drilling. So things involving the mining industry, for example, um, they are very often dealing with challenges in uh reducing and commuting and handling hard rock materials different than the more softer sedimentary rock formations that are uh more the standard for oil and gas drilling. Um, so there's some areas probably outside of geothermal, of course, where this technology uh would have a lot of economic use cases. But the big one, of course, to me is just unlocking a whole new uh sub-resource of geothermal that really really scales up the potential.

SPEAKER_00 37:11

What about outside of drilling and rocks and mining? Um, is there any fun things that you guys come across and you think, oh, wow, this might be really good at, you know, building a house or something?

SPEAKER_01 37:26

Yeah, I mean, I think uh a fun one for me to always entertain uh because it's also far out there, and I think it's more fitting to this, you know, people picturing this thinking it's something from Star Trek, but actually doing this drilling but in space, extraterrestrial drilling um is quite an exciting application, uh really novel application. You know, we need to find someone that can give us a ride to get up to space, but uh this is a this is a process that does not require gravity or mechanical forces to destroy and reduce rock. Um, in addition, you're also with vaporization, not just um reducing your rock to something smaller that you can remove out of a hole, you're actually breaking down the mineral structure and reducing these rocks to metal oxides, which when you look in terms of some of these challenges that NASA and other countries are looking at for um space in terms of developing, say, um facilities on the moon, one area they're looking at is how can we utilize the existing materials on the moon or on other planets or asteroids for the purposes of, say, building infrastructure that is hospitable for people to stay on these extraterrestrial bases. And so with our vaporization process, in fact, we're already reducing these rock components into a smaller, more manageable, say, metal oxide that can be accompanied with some processing equipment that is able to deliver, say, building materials for putting together a um a structure. Um, I think there's a lot of exciting potential there for this um sort of space in situ resource utilization and drilling, just space extraterrestrial drilling where we could certainly have a strong, strong use case.

SPEAKER_00 39:15

In the um in the in the rock that gets vaporized and sucked back up to the surface, um does is it possible that it could be used as well to extract traditional metals, gold, silver, cobalt, uh they come out. Yeah, that is possible. I mean that's a ridiculous application, right?

SPEAKER_01 39:37

Yes, it I think it um definitely depending on the site, um, similar to how people are looking at lithium co-production with geothermal today, it would be very dependent on the rock you're drilling. And of course, with these boreholes that were vaporizing, they aren't, you know, even though they're quite deep, if you actually tally up with the volume or masses of rock being removed, it's not a massive amount compared to commercial mining operations. But just in general, the fact that, like you mentioned, we're actually create producing these metal oxides, which could include commercial ores of interest. Um, there's certainly opportunities for what we do with the cuttings in this context, actually, are ash that we're producing, not like more traditional rock cuttings. Um, but there are use cases to utilize those um various vapor post-vaporization deposits um for just extracting you know relevant ores of interest. Um so definitely there could be areas where we're drilling that have much higher grades of, I would think, especially maybe much rarer um metals today that have a large uh lower throughput or you know lower production. So you know, producing a small amount of iron maybe you know isn't going to be too valuable. But if we're right drilling in formations that have are harnessed, harvesting uh platinum or you know, similar, much rarer metals and and uh minerals, that could be pretty interesting use case for sure.

SPEAKER_00 41:04

And if you do achieve the breakthrough, does Quaze then own that technology and anyone else who would use it would need to license it off you?

SPEAKER_01 41:14

I think in the context of drilling deep boreholes through a millimeter wave drilling um with this vaporization process, I would say yes. Um I think there's gonna be maybe applications and in general, we're focusing on the specific area of the electromagnetic spectrum for the purposes of rock destruction. I I think there's a pretty large white space there um for other um potential researchers and companies to look at in terms of how they can deploy similar technologies for the purposes of say reducing rock or whatnot. But we will we definitely plan to own the IP entirely for drilling these deep boreholes for geothermal, especially.

SPEAKER_00 41:58

So say 15, 20 years down the line, you you knock it out of the park, the technology does exactly what you say it'll do. I can come along and be like, I'm gonna dig for uh super rare earth metals in in Australia. And um do I there do I then pay quays for that for like the permission, I guess, to use the technology? Or is it does that then because the purpose would be outside of drilling for geothermal, does it then be okay? I and maybe these aren't questions that are important at this stage, but it's just curious because you know, one of the huge compelling parts of Quase is that you could well be one of the most valuable companies in the world, assuming it works. And I don't know if I'm being too hyperbolic there and getting carried away with myself, but um that's that's a sense I get at least.

SPEAKER_01 42:51

Yeah, I mean I think um when we are at that stage, I will say, you know, I I'm not too certain on details of how the IP would work there, but one thing I'm pretty certain of is that even at that stage where our value would justify our our value, and I would I would agree if we're fully successful, we have the potential to be this incredibly valuable company. The value in what we do will not necessarily be the IP or the patent, at least the patents, you know, the ones that would be protected or could be preventing or enabling others from doing similar applications. I think it's really going to be the craft in how we do this. I think it's gonna, you know, it's like you could get a recipe from a chef and you can understand, all right, we need this much turmeric and this much salt and this much chicken. Um, but how that all goes together and how you cook it, that really depends on the chef who knows the recipe. And so I think similarly for drilling these millimeter wave boreholes, it's deceptively simple in that we're sending high power microwaves and a purge gas downhole and we're getting a hole out of it. There's a lot to be done there in the craft and how this is operated in practice for actually delivering a borehole, let alone using it for other rock destruction applications. applications. And so that's going to be the type of IP that is very valuable and that we'll be keeping pretty close. Similar to uh Coca-Cola recipe, I guess, would be another example.

SPEAKER_00 44:10

Right. Nice. All right. So to a layman, could you please describe to me what the technology is?

SPEAKER_01 44:16

Yes. We are vapor creating a deep borehole through a process we refer to as millimeter wave drilling, which basically involves transmitting high power electromagnetic radiation in the high frequency part of the microwave spectrum we refer to as millimeter wave, using that energy to actually vaporize a hole into rock. And the way that works is the same phenomena that takes place in anyone's microwave oven when they're heating up their food. Rock is a dielectric material and when you deliver enough electromagnetic radiation, particularly being most advantageous in these microwave frequencies, that dielectric material is going to want to heat up because the molecules there will see this alternating electromagnetic field and respond on their own by beginning to move around for lack of a better word. So they'll vibrate, they'll buzz around basically what temperature rise is at the atomic molecular level. And with enough energy for any material you can obviously heat it up to induce a phase change. In particular with rock rock melts at around 1000 to 1500 degrees C and vaporizes at a much higher temperature of around say 3000 to 3500 degrees C. So with enough energy you can not only melt rock with microwaves but you can actually reduce the rock to a vapor, a gas, which is crazy to think just truly a gas, like not even pebbles, but a gas. Yes, very very momentarily I think so when rock is going to heat up to this vaporization point, it will be liberated from its surrounding liquid phase, its melt phase, and it's going to very quickly condense back into a solid. But importantly this is not a large drill cutting like you would get from mechanical destruction with the bit. It's actually an ash produced postvaporization and because it's coming from the gas form it's going to be an incredibly small size and it's going to want to very momentarily be very sticky for lack of better word. It will want to agglomerate with other ash particles might want to stick to things along the hole in the waveguide, which is one of the engineering challenges we're very much focused on here in the next couple years. But it's so small that you don't require a very heavy powerful fluid for removing this cutting out of the hole for material removal. And that's always one of the biggest challenges for drilling is not just destroying the rock, but finding a way to get that material out of the hole to continue completing this borehole that's the chief objective. And so because that ash is the way it is we believe a circulating purge gas that is transparent to microwave energy does not interfere with the millimeter wave transmission in any sense, at least in most pressure settings a purge gas is sufficient for actually lifting this ash up the hole over several kilometer distance for for removal because again the ash is so fine enough to to begin with and also there is a mass balance where we're adding much more purge gas into the borehole than we are taking rock vapor out. And so that ensures we can actually dilute and get this ash out of the hole without leaving it down there and plugging things up. So in essence the drilling is microwaves and purge gas to come down a pipe. Our drill pipe is called the waveguide and that is the only component downhole. And those serve the purposes of reducing the rock by dielectric heating, vaporizing the rock which quickly is recondensing back into a solid form, but this very fine ash, which they can then be removed from the hole by this circulating purge gas that's also injected down our pipe. Now the reason we're able to do this is because of these two key technologies coming from fusion research the first being the gyro device which at a high level the way the gyro works is it's a very large high powered vacuum tube that when you feed electricity into it it's going to generate an electron beam within its vacuum cavity. And accompanying that vacuum tube is a very high powered magnet that's generating magnetic fields exceeding one Tesla that when those electrons see the magnetic field, they're going to want to start gyrating. And it is through this interaction of this very high voltage electron beam and the magnetic field that we are able you are able to derive electromagnetic radiation, particularly in these microwave frequencies from this initial electrical energy input. And these devices are built to be fairly efficient with modern systems. They can reach up to say 50-55% and there's some work to improve the efficiency even further for delivering very high power microwaves from an initial input of just simple electrical energy. So we have a device that spits out very high power microwaves but importantly it's also spitting out that energy at these frequencies of 30 to 300 gigahertz that are particularly advantageous for transmitting electromagnetic radiation over very long distances and within the sized pipe that we would need for drilling a full-size geothermal borehole, which is on the scale of say eight to 12 inches in diameter in its deepest bottom section. So I always like to make the comparison that when a lot of the initial research into waveguide technology was being performed back in I think you know the 50s and 60s, they were actually looking at these large waveguides one to three, four inches in diameter and using microwave energy for the purposes of communications, transmitting information over very long distances. And the reason they went away from that approach is a new technology came about that was vastly superior for that application, which is fiber optics. And so you can make the comparison that what fiber optics are doing is very similar to what we do but with much higher frequency electromagnetic radiation. They're using light wavelengths and they're using very very tiny dielectric or glass lined waveguides essentially that are bundled together. So they're using a wavelength that is much more advantageous for the size of waveguide they need for transmitting that energy extremely efficiently with low attenuation loss. Whereas in our context for drilling a full-size geothermal borehole, the lower frequency millimeter wavelength range is really ideal for transmitting energy efficiently over long distances in the sized pipe that we would want for drilling a borehole. So it's that combination of generating high power and transmitting it very efficiently over long distances that will enable us to transmit all this microwave energy down a deep borehole for the purposes of millimeter wave drilling.

SPEAKER_00 51:28

Cool. Alright a few things um it's not a continuous wave of energy it's a burst then a suck back then a burst then a suck back so it is actually continuous.

SPEAKER_01 51:42

The way this would work in practice is that the Gyrotron is not on 24-7 but it is on for the purposes of drilling a length that basically correlates to how long a specific joint of the drill pipe would be. And so you'd be operating on the order of say one to two hours continuously of transmitting microwave energy and purge gas downhole. Then there would be a pause where you would want to switch in and add in more waveguide or drill pipe to continue drilling. But for that one to two hours things are continuous. And in one to two hours how many centimeters of thickness would you be able to remove yes we're shooting for around three three and a half to five meters per hour which today is not like a super um extremely fast rate of penetration but when you look at it for drilling super deep boreholes it would be an incredible orders of magnitude improvement on the overall average rate of penetration. I think that's an important parameter in that it's not just the rate of penetration while you are drilling, but it's the overall speed at which you're delivering this hole because when you're drilling these super deep boreholes a lot of that time is actually lost non-productive time when you're not actively drilling the hole because you're having to replace damaged bits or recorrect the trajectory of the well. And so achieving that three and a half to five meters per hour continuously and independent of depth is really what we're banking on here for this solution.

SPEAKER_00 53:13

Oh yeah that's true right so at 20 kilometers you will be able to dig just as fast as at one kilometer that's right the key parameters driving right the key parameters driving the drilling process are no longer depth and pressure or the rock characteristics.

SPEAKER_01 53:33

You know in other words is it very abrasive and hard which is the case going into this deeper basement rock where rock is going to be uniformly crystalline. The only parameter that's affecting our drilling process in comparison is composition, the elemental composition of the rock. And when you're looking at rock at those depths in the basement in terms of elemental composition it's actually fairly similar. There's a lot more complexity in the mineralogy because those different elements can combine and form the link up different minerals depending on the various pressure and temperature regimes at which you're at it a certain depth. But the elemental composition is going to be fairly uniform, at least for the depths that we're drilling. It's going to be mostly similar to a granite like rock. And so we understand that you know we've drilled granite in the lab and understand that it's a rock that millimeter wave drilling can be particularly efficient at in drilling and that similar crystalline rocks to that composition aren't going to differ greatly in terms of the millimeter wave drilling efficiency. And so that's why we believe it's a process that very much is going to operate independent of depth.

SPEAKER_00 54:39

And and how how confident are you or how rather how confident are we about what is actually at depths beyond say 10 kilometers since there aren't many holes that go that deep you know well we're definitely confident there's heat.

SPEAKER_01 54:57

It's definitely going to be hotter um how hot's going to be a question of location but generally anywhere you go the deeper you go the hotter it's it's going to get but you're almost certain it is rock. Yes. Yes it's there will be some variety in the rock but we're not going to hit um you know Jules Verne lost ocean at the center of the earth it's you know I I will say to introduce some humility here always doing things in the subsurface you have to count on the unexpected and I'm certain when we are able to drill these first super deep boreholes we'll probably find there's even some things that maybe you know geologically geologists and geophysicists have presumed you know at a certain depth we're going to encounter certain horizons of say metamorphic rock we may find you know evidence that confirms or refutes that because that was the case with the cola borehole in similar deep wells when they were first drilled. They found that there's a specific depth horizon where most geologists and geophysicists at the time have presumed this is a transition from more felsic granite based rocks to more mafic rocks like a basalt that you would find in Hawaii. And they found actually you know their reasoning for that was geophysical signals in particular looking at seismic data and seeing an inflection in that seismic data at these depths. And what they found was that was totally not the case. There was actually I believe a more of a horizon in metamorphism that was not signaling a step change in terms of the rock composition from felsic to mafic. So the fact that that thinking was basically refuted by having just a hole that finally got down there and able to look around so to say I think there's definitely going to be use cases for us where we drill deep and find that we find things that maybe refute some of the traditional thinking. One hypothesis we do have um and this is assumption here but we think there's good basis for it from especially a lot in literature is that we do believe as you go deeper there is going to be um higher permeabilities and more fractures more flowing fractures present than I think was initial what's initially been anticipated by many researchers presuming that permeability gets very very low with higher depth. I think there's evidence to believe that one, a lot of the crust is actually pretty heavily fractured up until the brittle ductal transition because this is how the crust manages stress and actually ensures it to be the most competent because it's able to for lack of a better word accommodate increasing stress along the strain in these fractures that also allows for permeability at great depth. And I also think there's uh good evidence in the literature and field work done on fracture networks that have formed in rock that begins to become more and more ductile that show that natural crustal processes actually yield permeable flowing fracture networks that can be harnessed to create a reservoir similar to EGS at more modest temperatures and brittle deformation conditions. Similar may not totally as permeable but fracture networks can still be hosted in these types of deformation regimes and host uh permeable flow. So I think there's I think there's going to be some surprises for certain but I think there's that's one assumption we are really keen on um validating with these deep drawing is whether there's actually more uh higher permeabilities than what would have been expected.

SPEAKER_00 58:30

So as the microwave um goes down the pipe how many sort of centimeters at a time are removed in vaporization? Like how often are you sending down the purge gas? I'm just trying to imagine what what it might look like if you could get a sort of cross section of it happening.

SPEAKER_01 58:49

Yeah I think a good analogy um to make here and hopefully I'm not sealing Carlos's thunder because he might have already made this uh but I like we like to think of it as a burning candle in a sense in that we have similar to this candle has this hot spot where the flame is and it's slowly deepening as that wax is melted and vaporized. It's evaporated from the solid candle similarly our hole basically is being formed by this hot ablation front or ablation surface where the rock and millimeter wave energy interacts it's at the very very top thin millimeter wave millimeter scale um slice of the borehole bottom of this rock that ablation front is essentially deepening down the hole at our drilling rate of penetration so we're trying to drill like I said around three and a half to five meters per hour that's about a a millimeter per second and in terms of the hole sizes we're drilling let's say it's eight inches so that's um eight inches about 20 20 centimeters or about 30 square centimeters of um 30 square centimeters of area and so might have to check my math here after the podcast. I'm pretty certain that comes out to around three cubic centimeters a second of rock vapor we're producing during the drilling and we are putting down purge gas into that hole continuously at a rate that's going to exceed that by I would say at least a factor of 100 or more. I think we're looking at flow rates somewhere around 10 to say 50 or 100 meters per second. And so it's overall the mass balance is supposed to be that there's more purge gas going down and flowing through the hole than there is rock vapor so that it's staying diluted and ensuring full removal of that material.

SPEAKER_00 1:00:47

Okay cool. And final question on the technology I know you answered this before but I didn't quite understand the energy source of the uh gyrotron in the first place is this like is this hooked up to a to a generator like where do you get the energy from because presumably it's a crazy amount of energy that's required to vaporize the rock if you could in layman's terms describe how much energy say per meter is required but then as also as well what is the source of that energy.

SPEAKER_01 1:01:21

Right. So for again drilling at that three and a half to five meters per hour metric and for drilling a full-sized geothermal borehole which we're saying is around eight to ten inches in diameter that requires about a megawatt of microwave power going down the hole. And when you back that out to the total power requirements for this millimeter wave drilling rig, which includes the purge gas injection, any mechanical system, say raising and lowering the pipe, this is probably coming out to somewhere around four to five times that megawatt. So four to five megawatts it's pretty power hungry for for a drilling rig, but it's not an order of magnitude larger and importantly that power generation need on site can either be met by commercially available diesel remote generators as well as power that can be taken off the grid in certain settings that have a convenient interconnection for that. So what's important too is that the gyro has a power supply that produces converts that electrical energy to the exact high voltage the gyro needs. And so you can work with 480 volt power lines or diesel generators for getting the high voltage needed for running the gyrochron. It's just sourcing that power which is larger than a conventional drilling rig but not an order of magnitude larger. And importantly we reduced on other consumables such as drilling MUS and any sort of mechanical tools and and what what is five megawatts?

SPEAKER_00 1:02:54

Is that like the energy that say an office building with 10 floors would consume in a day what's a comparison to so I can make sense of how much energy that might be yeah it's uh you know I kind of off you know not a very accurate rule of thumb but I you know I think usually a household tends to be pinned down as like one kilowatt so that's about 5,000 homes.

SPEAKER_01 1:03:22

Importantly the power we are playing to harvest from these geothermal wells we're intending to build you know at the minimum a triplet set of wells that can produce 50 to 100 megawatts electric of power for 30 years. And so we might be consuming five megawatts of electric power um for that first year just for the drilling but this is yielding a system that can produce 20 times that for 30 years. So the EROI I think is justified by again the increased power output we get of the well but it's uh it's it it takes some power to to power this system at full scale. It's nothing out I think out of um the realm of what we do today with conventional drilling and even flow testing for geothermal well fields these all always involve these very high power megawatt scale diesel generators to begin with and so it's just finding a way to optimize those in the field and of course redual reduce fuel consumption where we can what does a a diesel generator look like that can generate five megawatts of power that thing must be a beast.

SPEAKER_00 1:04:31

Yeah it's big um I don't think it's bigger than a like a semi like a 40 foot flatbed but that's a scale I think we're we're talking about here and we probably need a couple of them uh coupled together um so it's you know it's you know looking at a sort of drilling rig footprint it's um you know they there's a lot of space that would be taken up by drill muds and other things that are kind of being replaced in our operation with say the gyrotron power supply these diesel generators that are coming on site um it's almost like this substitute of more of the this electrical infrastructure versus the mechanical and fluid based infrastructure that's needed for conventional drilling but it's uh yeah it's um it doesn't look I think too out the ordinary on a drill pad nice the big generator though for sure but uh look that's uh incredibly interesting there was definitely a lot of technical talk that it went over my head but I um I think I get a picture of it really fascinating extremely exciting as well um it seems like it's doable I don't know uh are you guys at Quays just sort of swelling with optimism and you have to sort of tamper down your expectations a lot of the time because uh one gets the sense that it's almost you're it's a done deal.

SPEAKER_01 1:05:51

It's just a matter of time yeah I think we we have plenty of um our little engineering challenges and even you know outside of the engineering You know, smaller things that keep us uh humbled in the meantime, but I think the belief there is shared throughout the organization as a whole. We believe this is going to work and be transformative. Um, it's just a matter of how fast can we do it.

SPEAKER_00 1:06:14

You uh mentioned right at the beginning of our chat um about the grid, and it came the the comments suggested that it was a bit of a negative inflection on the grid. And I've heard as well uh Robert Friedland before speak about the problems of the US grid. Um is this a subject that you uh know much about?

SPEAKER_01 1:06:36

Only through good friends of mine that are real experts in these grid challenges.

SPEAKER_00 1:06:42

Um maybe, I mean, tell me, what do they say about it? What are the challenges?

SPEAKER_01 1:06:48

I think to me, uh a large one is again having commercial firm dispatchable power that can be brought onto the grid today. I think California being the canary and the coal mine, as well as the real leader, I think they've done an incredible job in terms of pushing forward, showing that uh one of the most, you know, the biggest economic powerhouse of the United States and very large energy consumer can feasibly be sourced 100% of their electricity needs from renewables. Uh, I think they are, being the groundbreakers they are, the first to really encounter this challenge where increased, in their context, solar penetration has resulted in these periods where there's a massive ramping up period for accommodating energy needs as people come home and turn on their air conditioners and power demand is up while that solar generation is declining as the sun is setting and turning to night. And so I think a lot of people in that space have pointed out that California's challenge now is really not, it's uh it's like the the wind and solar have almost gone too far ahead of themselves, and there's a need for dispatchable power and base, even baseload power in the context of their, I think, planning to restart Diablo Canyon here, or at least keep it in operation. The uh large nuclear plant that's still still around in California. Um, they're already seeing a need for exactly what we want to provide with geothermal, which is universally accessible, dispatchable geothermal power. So I think that's California's kind of a canary in the coal coal mine for what all states throughout the country are going to face. And there's a lot of solutions there that I think take place also outside technical realm, but a policy realm. Um, I mean, just building the high voltage transmission and interconnections to link a lot of this wind and solar from the states with the most resource potential to states with higher demand is a challenge that isn't really technical or economic. It's just a policy one, and one that if we can figure that out at policy level, will significantly accelerate some of the challenges we're facing right now with bringing more renewables onto the grid. But when that is successful, I think the rest of the country too will be in a similar spot as California, where there's a challenge in meeting uh meeting these additional energy needs with more firm dispatchable power. Um, and that's where geothermal is a very, very efficient solution.

SPEAKER_00 1:09:17

And so when you talk about baseload and the grid, that's geothermal just slots right in there. That's sort of the energy that's turned on when, say, the solar is has run out at night time, or say at 5 p.m. when everyone comes home at the same time and there is um you know a lot of demand from the grid that wind and solar can't meet, baseload comes in and supports there as well. Uh that that's the the idea is that they all sort of work together. There isn't a um there isn't a energy supremacy from one of the imports.

SPEAKER_01 1:09:52

Exactly. And for my own case, I'm going to try to insist on also that the vocabulary correct vocabulary here would not be baseload, but rather firm or dispatchable power. Base load powers that's been operated is actually just say operating a coal or nuclear plant at its one gigawatt capacity and it just sits at that all year long. And with wind and solar, the challenge is you don't necessarily need that flat sort of power. You need power that can accommodate the ebbs and flows of when wind and solar on the grid are extremely cheap in the peak, their peak hours. And when they're at those hours, they're able to bid at prices that are incredibly low, which makes it challenging for any baseload resource, I think, to compete economically, even though there's a larger systemic need for that more firm power with higher capacity factor. And so what's beautiful about geothermal is there's a variety of ways that you can do that dispatchable operation, even though traditionally geothermal has not been it's been operated more as a baseload power source. But I know the Geysers in California, which is their large largest geothermal plant in the world, actually, or geothermal field, it's a collection of geothermal plants to be specific. They simply divert their power and basically, you know, are being told by the ISO that you know, fluctuate your power output so that we can balance you with this wind and solar that's uh comes online at various hours of the day. Um they're already doing that, and there's ways to do that, but also making economic use of that wasted energy. So you can install lithium ion storage, you can look at these co-productive sort of applications. Maybe you make hydrogen at the geothermal site, uh, maybe use it for carbon capture or heating or something of that fashion. Um, but there's also some opportunities to look at even with doing this in the subsurface and balancing the actual operation of the reservoir to be dispatchable. So there's a lot of optionality there for both surface and the subsurface that makes me confident that geothermal can meet this sort of need for dispatchable power, firm dispatchable power, even though it's been operated in this sort of more baseload manner, traditionally.

SPEAKER_00 1:12:10

And um, what is your timeline for when you can go out and test the first super deep uh well?

SPEAKER_01 1:12:20

Yes, we are getting out into the field for in the next year, and that is gonna be our first testing uh pretty shallow. Uh, we're looking for areas where we have this hard basement rock at the surface, and we can get a lot of practice drilling shallow wells at the surface where we can also add a lot more monitoring and observation. But in parallel, we are developing the first commercial, uh I would say, or full-scale millimeter wave drilling rig. This is actually a hybrid drilling rig that we're building in collaboration with Neighbors Industries, the largest manufacturer of onshore drilling rigs. So Neighbors is very much providing the conventional drilling rig architecture, which we then integrate with our millimeter wave drilling technology components. And I believe this is a point I didn't really elucidate early on. I want to make clear is that we do not drill these super deep holes solely with millimeter wave drilling. It's really not optimal to do that because we know conventional drilling is a hundred-year mature technology that is very successful at drilling through these overlying sedimentary overburden formations that separate the surface from the deep basement rock. And so when we go into the field with this full-scale rig, we would start at the surface conventionally, drill through that sedimentary overburden, and only switch to the millimeter wave drilling when we're in that deep hard basement rock. And this is also by proxy actually helping us avoid some of the subsurface formations that would prove prove more problematic for millimeter wave drilling, such as hitting And that's underwater. I'm sorry.

SPEAKER_00 1:13:56

That's on that's happening underwater. This is offshore.

SPEAKER_01 1:14:01

Oh no, this would be onshore. So this is all onshore. Um this is yeah, so starting at ground surface, drill conventional and to through sedimentary rock, and only switch to millimeter wave drilling in that deep basement. So that rig is going to be operational by end of 2024, and we plan to be drilling our first, at least super hot wells in 2025-2026 with that rig. So we'd be starting looking at shallow settings, but importantly, the reason for that is to not just successfully drill a well, but also build out the geothermal well field, um, the reservoir, and being able to connect that with a power generation infrastructure for the purposes of the first real super hot geothermal power plant. So that is what we want to deliver by 2026 to 2028. And so, in parallel, we'll be maturing deep drilling technology so that we continue to push the envelope and how deep we can go. But very much within this decade, we want not just our first super hot wells and deep wells, but also the first super hot geothermal plants online. Um, also we can get into the business of making revenues.

SPEAKER_00 1:15:11

Fuck yeah. And uh who who takes care of all the commercial side of things? Like who's determining a partnership with NABORs and or neighbors and you know who's the person that's seeking out the licenses to drill in certain places? Is this all on the shoulders of Carlos, or do you have commercial people in the business as well?

SPEAKER_01 1:15:31

Yes, we do have a business team based in Boston um led by our CFO and head of corporate development, Kevin Bonebreak, very much trying uh uh understanding and acquiring and developing the first partnership so that we can go out into the field and have the partners involved to not just drill these wells, but create the reservoir, complete the well field, and hook up power generation for the purposes of having the full well field reservoir and power plant for actually harvesting this energy and produce power. So very much we have that team already within Quaze developing those partnerships, and uh we're very much leveraging that by getting to these super hot temperatures, we're going to create a huge pole in these adjacent industries to provide the technologies and capacities that are needed for actually creating and operating this reservoir for long-term sustainable power generation.

SPEAKER_00 1:16:29

And tell me how exciting it's been in the last year particularly, but in the last several years. The mainstream maybe mainstream's too much, but the much more popular adoption and understanding and discussion of geothermal energy as um not like a brainchild of an academic, but instead a very feasible um energy solution.

SPEAKER_01 1:16:56

It's pretty damn cool. I I mean we talked on this earlier about how the level of risk it felt, kind of jumping into this, knowing that there was a lot of uncertainty around geothermal. And I've had a lot of discussions with people at our um, you know, there's a nationwide conference called the Geothermal Rising Conference or GRC, that's kind of the lead uh industrial in industry trade show and academic conference for all things geothermal in the US. Uh just seeing the mood at those conferences from when I attended as a grad student in 2017 to attending the most recent one in 2022 in Reno, just dramatic shift in the mood and just also the presence, the number of people there. I mean, there was when I attended in 2017, I don't recall a single startup like entity like ours that was really pitching, you know, kind of a novel scalable geothermal solution. And now it's, you know, I don't even think you can get us all in the same room at a time because there's so many of us, both in the US and worldwide, all pursuing different solutions. And really, I think, you know, you just look at it from a high level. I'm obviously highly biased in that quays and that we're gonna work, but I think you know, there's a actually a diversified portfolio of all these different means of harnessing and scaling geothermal that I'm just 100% confident that we're all going to figure this out and obviously buy it for ourselves. But it's it's a real step change in the mood shift, I think. You know, it's pretty pretty cool to be a part of, and definitely makes a risky decision. Five years ago seemed more than worth it.

SPEAKER_00 1:18:29

There's a Slovakian company I was told about the other day. Um I forget the name now. Are you familiar with them? Because I think the reason that they were brought up is they're doing something similar to what you guys are doing.

SPEAKER_01 1:18:42

Yes, GA drilling.

SPEAKER_00 1:18:44

GA, yeah, that's okay. So talk to me about these guys.

SPEAKER_01 1:18:49

Yeah, so as I understand it, they are also developing a non-contact approach for deep geothermal drilling. The difference with what they are doing is they aren't transmitting microwaves down a hole for the purpose of vaporizing rock to produce a hole, but they are actually looking at heating and heating a rock with basically a downhole plasma torch with the intention of inducing spallation, mechanical stresses in the rock from that heating that break the rock apart into small cuttings that can then be flushed away with uh more traditional drilling fluids or drilling muds. Um so it's actually involving a I think a power cable that would be coming down the hole and having the technology downhole for generating this plasma torch that does that spallation process. Um I hope I'm doing good justice there to their technological approach, but that's that's my understanding.

SPEAKER_00 1:19:46

Cool. I mean, and do you see them as competition? Like, how do you view the competing technologies to uh to drill the same depth that you're trying to drill? Do you do you see you guys as all sort of working together? Do you share ideas? Do you help each other, or is it straight up like you're competing over a finite resource? Who can drill first?

SPEAKER_01 1:20:09

Yeah, I I think there's a little competition there, but I think there's a greater picture we all see ourselves as being very much on the same team of delivering geothermal. And I think importantly, what we'll find as we are scaling up is that we will find. I mean, I'm biased in that I think we're going to be able to do this everywhere, but I'm certain that especially in an earlier stage, there's going to be by site-to-site specific needs that maybe demand a specific approach. I think just from my reading and understanding, I think there's probably a lot of applications where, say, certain settings where shallow and faster drilling maybe is more advantageous, and maybe there is a uh a reasoning for deciding on one approach or the other, depending on the real requirements of the of the geothermal system. So I'm very glad they're they're doing what they're doing because I think they're going to find um there's going to be use cases for that drilling approach for delivering deep geothermal holes.

SPEAKER_00 1:21:03

Alright, and just one more question on the competition. What do you make of Eva?

SPEAKER_01 1:21:09

Ever. Yeah, I mean, closed loop, again, I think it is an extremely exciting solution for district use heating and a lot of heating use cases. Um I think they've gone very far in pushing um development of a real first-time commercial closed loop system that I think would be a tremendous accomplishment. I think my initial impression reading of closed loop is I know there had been a lack of technical successes because you're always trying to overcome an inherent limitation in the thermal diffusivity of the rock. Rock is always an insulated material, and so there's a limitation there that I think has proved hard to overcome previously for a lot of projects, um, in that rock is not a good, very good conductor of heat, and so you're fighting against that. But I think Everett's come up with a solution that I think is very much uh something that can yield commercial um heating cases, and I'm sure even in certain locations, uh commercial electric power generation. Um now, in my more biased opinion, I do think enhanced geothermal systems are preferential for maximizing power output of the site per well. And I also think there's an approach to where you can create these EGS reservoirs virtually independent of location. Um but I think grand scheme of things, it's good that there's both competitors doing both EGS and closed loop. And I'm certain that especially as the next decade takes place and a lot of these projects are ramping up, there's going to be certain use cases where closed loop will be advantageous to EGS and vice versa. And so I think it's great, you know, also just the buzz and um what they've been able to do in Europe and expanding um sort of this reach of novel geothermal technologies beyond the US is also a good achievement. So I'm I'm very excited to see what the what comes out here in the next couple years.

SPEAKER_00 1:23:09

Well what about uh Ever Deep? Do you have any insight into how they're digging? I think it's up to 15 kilometers in Germany. Um whether they're digging now or not, I'm not sure, but I definitely saw a press release that they have won the right to attempt it. Um do you have any insight into how they're digging so deep?

SPEAKER_01 1:23:29

I do not. Um I know I can definitely just seeing it from the surface, literally, I think it's challenging. Um those are very deep holes they have to drill to get to those temperatures, and importantly, they want to drill laterals downhole for maximizing the contact area. They can harvest that heat through conduction. Um, but they definitely, you know, I think they have um the will at least to get it done. Um, and if I think they do the drilling smart, um they can deliver it at least at a cost where these initial projects could be could be economic for those certain use cases. Um I I don't know much on the yeah, the drilling specifics there, but um I do note in relation that um Fervo had a lot of drilling success recently with their demonstration project and the Forge project as well, um, had some exciting updates on their drilling progress and really improving rate of penetration. So I think there's reason to believe that Ever can um definitely definitely make it work on the drilling side, even though these are going to be very deep and challenging wells, but we'll open to see the next couple years.

SPEAKER_00 1:24:37

Well, Matt, I I I cannot uh thank you enough. You've been so generous with your time. I hope it's not the last time, actually. I uh you know I keep such an intensely close eye on geothermal, but as well Quaze, uh it it's um you know I want to be involved as much as possible because I do see it as like a a generational opportunity, right? There's the overall trend you can identify, but then within the trend there are certain players who are going to capitalize on the trend. And so, yeah. Um I think it's amazing. And I'm totally blown away as well by how sort of clear you speak about the technicalities of it all. I don't know if you realize, but you didn't sort of stumble over your words once. It's really impressive.

SPEAKER_01 1:25:31

Thank you, thank you. I think we've done a lot of um had a lot of discussions recently where I've kind of realized, you know, you kind of get the pitch down more and more in terms of what the key areas you want to uh hunker on. Um practice helps a lot.

SPEAKER_00 1:25:46

Well, look, you know, I'm sure I could keep asking questions, and I know later on I'm gonna think of a million things I should have asked you now. Um, but instead we'll just close on two questions I try to ask as many guests as possible. Non-geothermal related. Uh the first being, what is a country you're particularly bullish on?

SPEAKER_01 1:26:08

Do you ask count?

SPEAKER_00 1:26:11

Fuck yeah, it counts.

SPEAKER_01 1:26:12

I'm I'm bullish on I'm bullish on my own country. No, I think we're in a position with you know the energy transition where I mean, just again, non-geothermal related, you look at the wind and solar resource, and it's like we are just always throughout history have been eternally blessed by the geography of this country we have access to. I mean, it helped us when uh initially growing, we had the waterways interconnecting that no other country had in terms of scaling sort of agricultural production and trade within the country. We have this plentiful fossil fuel resource in coal, oil, and gas that allowed us to very rapidly industrialize the 19th, 20th century. And truthfully, with 21st century energy transition, again, we have like the Saudi Arabia of wind, we have the American Southwest. It's one of the best spots to do solar energy. We have all this geothermal potential, not even focusing on deep geothermal, but just looking at the West and US. I think we're once again kind of uniquely positioned to really be a leader in the energy transition. And I think there's now political willpower for it in the form of what we've seen with the IRA now at the federal level. We are putting significant resources now to scaling up the energy transition. And with the bounty of resources we have, I think it's really going to position us to be, continue to be one of the leading engines of economic growth in the world over the next hundred years while also helping solve the mainstream challenge of climate change.

SPEAKER_00 1:27:40

Yeah. I mean, I it's i I get the sense you've been reading Peter Zihan. I don't know if or maybe it came to that independently, but he um I mean he he would echo absolutely everything you've just said. Um and I would also put US as the country I'm most bullish on. Followed by Mexico. Uh yeah, yeah.

SPEAKER_01 1:28:01

I like Mexico a lot too. Um not definitely not just being our neighbor, but I think also there's you know it's an exciting century for Mexico and again.

SPEAKER_00 1:28:10

Yeah, 150 million people, um the most hungry economic consumer is their northern neighbor, um you know, a culture that values hard work, uh a super highly educated populace, you know. If if only the US would stop demanding cocaine, then that's changing anytime soon. Yeah, I don't think it is either. It actually looks like it's getting worse. But if not for that plight, which is also a consequence of their geography, you know. Um if not for that plight, they'd already be like a top top 10 GDP for short, potentially top five GDP in the world. But yeah, cool. Um final question. If you could witness a conversation between any two people of history, dead or alive, no language barrier, so you're listening to a podcast, who are you listening to?

SPEAKER_01 1:29:09

Oh, there is a good one. Um two people in any discussion. Um I'm gonna need a minute because I do want to give a good answer here. Alright, I think I've got an interesting one. Um it's gonna be a free-flowing discussion between them, but I think I'm gonna go with Isaac Newton and Mozart to have a brainstorming on just their whole realm of thinking and how they came about it. I think, you know, I'm really interested in learning, you know, things about Newton in terms of how, you know, he had all these interests outside of science that really took up a majority of his time, and it's pretty clear that that actually was a key driving point, probably how he came to some of the scientific conclusions he did. And at the same time, you just think of the sort of you know, just the creative output that Mozart had in however many years. I mean, I'm not even a big listener of classical music, but I can immensely disrespect that the immense talent he showed in that brief time period, and also just how he had this engine in his mind for creating music, in a sense, that you know, just thinking of Amadeus, if you've seen it, you know, Stalieri just remarks, it's like I can never compete with this guy. Um, it's clear they just were really not obviously very innovative in their realms of you know music and science, but also just really interesting creative thinkers. I would just love to hear about how they think about the world and I mean even just cosmology and meaning of the universe and things of that nature, because I think they would both have interesting insights and also from their own distinct periods of time. So I'm gonna go with that.

SPEAKER_00 1:31:02

Yeah, that would be unbelievable. Didn't um Newton spend most of his time trying to turn lead into gold? Like they actually consumed everything.

SPEAKER_01 1:31:11

So he spent a lot of time on alchemy and basically, I think for lack of a word, committing heresy against the church at the time. I don't know if this was the actual case, but I like to think that his friends chimed in and were like, hey, why don't you think about this gravity problem a little more? Because if you're gonna keep questioning the Trinity and all that, you're gonna get in big trouble like Galileo. Um so yeah, I think he he spent a lot of time really. I mean, he was very, very religious, and it's clear that he saw, you know, that kind of this, you know, these laws of physics that he was conceiving were very much, you know, reflecting the laws of nature that in his context his creator, his God had come to. And so um I think it's very interesting to see also, you know, you think of how science has changed from then also, and you see kind of where some of those ideas have been validated and refuted? Um, you can kind of see his realm of thinking was very much in his greater cosmology of the universe in terms of you know the natural realm and physics was only one one part of it, and that's why I think he would be fascinating for uh for a discussion.

SPEAKER_00 1:32:15

He was a deeply religious person, eh?

SPEAKER_01 1:32:18

I think so, yeah.

SPEAKER_00 1:32:19

I know um how did he how did he reflect on that or justify it or because presumably someone who who came up with laws of of of physics would be thinking in extremely rational ways. Like um, not to say that to believe in God is irrational, but it is a leap of faith for a reason, you know.

SPEAKER_01 1:32:44

Right? It's yeah, I I think his thinking is that there was no, you know, we have modern day very binary thinking between this is religion and spirituality and this is science. And for Newton, there was no line there, they were all part of the same thing when he was discovering laws of gravity and you know, calculus, he was discovering the language of God, I think, from his perspective. Then I know there's the quote, you know, I think a lot of this came out only up in like 1940s because this was basically locked away in Newton's documents that John Maider Keynes acquired. He actually purchased them and he gave this speech that I read, I think that's where I first came across some of Newton's kind of thinking outside of science, um, where Keynes remarked, you know, he looked at these documents, he's like, Yeah, Newton wasn't this first scientist, he was actually the last magician, you know. The way he saw science, you know, it was a very much a mystical, magical practice to what he was doing because of his sort of greater cosmology driving it. So um, yeah.

SPEAKER_00 1:33:47

It must be a great biography of him. Is there a movie on him? Unfortunately, no.

SPEAKER_01 1:33:52

I'm sure there's not the biography, but you'd think, yeah, there's probably room for interesting uh I mean especially with streaming services now, they do every historical event.

SPEAKER_00 1:34:02

Totally. I mean, Hugh Jackman is in his prime to do a Newton. How good would that be?

SPEAKER_01 1:34:09

Yeah, Jackman or I think Cumberbatch has already done the scientist thing a few times, so I it would be newer for Jackman.

SPEAKER_00 1:34:16

Yeah, give it a give it a Jacko. Um yeah. Well, yeah, Matt, absolute pleasure. Thank you so much, mate. I really appreciate it.

SPEAKER_01 1:34:24

Awesome. Thanks again, Ryan. Really excited to speak with you today and go geothermal.