Committee for the Redevelopment of Montserrat (CRM) – Public Statement on the disappointing results of the project to drill two geothermal production wells on Montserrat with funds provided by the British Government, but managed by the Montserrat based office of the Department for International Development (DFID)
The Committee for the Redevelopment of Montserrat (CRM) is a registered non-government organisation established to promote and facilitate the reconstruction of Montserrat after the volcanic eruption that began in July of 1995. At this point in time, CRM is putting on record its considered opinion that the results of the project funded by the British Government in the amount of 8.5 million pounds to drill 2 geothermal production wells on island, have been at best disappointing if not bordering on failure. This money was channelled through and managed by the Montserrat office of the United Kingdom Department for International Development (DFID) headed by Dr Kato Kimbugwe.
To fully appreciate CRM’s opinion on the status of the project to drill the two production wells, it is necessary to summarise critical events preceding the British Government’s release of the project funds as well as CRM’s connection with the entire geothermal enterprise.
- (i) After the CRM led demonstration in March 2006 which caused the John Osborne led administration to change its decision to give away control of Montserrat’s geothermal resource to a foreign owned company for a mere 4% royalty, CRM met with the coalition government headed by Dr Lowell Lewis to discuss the future of geothermal development. The Hon. Reuben Meade and his colleague the Hon. Charles Kirnon were members of that coalition administration. At that meeting, the government decided to establish an Energy Committee charged with the task of taking forward geothermal development. Represented on that Committee were two CRM members (initially Jim Bass and Ray Tyson or their alternates). Other members were the Director of Public Works (Chairman), the Managing Director of Montserrat Utilities, a representative of the Department of Environment, and a DFID representative (at that time the engineer Mr. Steve Price).
(ii) Almost concurrently, by July of 2008, the Energy portfolio was moved from the Ministry responsible for Agriculture to the Ministry of Communications and Works headed by the Hon. Charles Kirnon.
- The Energy Committee quickly arranged to commission a feasibility study to ascertain the extent of Montserrat’s geothermal potential. With CRM’s active involvement, the Energy Committee prepared the appropriate tender document, advertised it internationally, reviewed the tender applications and selected the successful applicant, that is, EGS of the United States. During the tendering process, applications were also received from companies originating in Italy, New Zealand and Guadeloupe. One submission from Nicaragua was deemed incomplete and could not be considered.
The tender price submitted by EGS and paid for by the British government was two hundred and eighteen thousand United States dollars.
3. EGS, one of the world’s most eminent firms in the field of geothermal science, began its work in 2009. It took almost a year to complete the feasibility study. In the intervening time period, EGS Managing Director Mr Paul Brophy and members of his technical and scientific team visited Montserrat frequently. During some of his visits to Montserrat, CRM arranged for Mr Brophy to be interviewed on Radio Montserrat and by other media. In these sessions, he provided very comprehensive explanations to the public as to the work in progress, the benefits of geothermal energy, and other details relating to the existence of the resource. At the conclusion of the study in early 2010, Managing Director Mr Brophy visited Montserrat to formally present the results to the Government. During this visit, CRM arranged for Mr Brophy to be the main speaker at a Town Hall meeting in the Pentecostal Arts and Education Centre at Brades. In that meeting, Mr Brophy answered questions put to him by a relatively large audience. Radio Montserrat recorded the proceedings.
On the basis of the EGS final report, the British Government agreed to finance the drilling of a production well, thereby bypassing the drilling of any slimline test well that would only prove the existence of some geothermal resource but could not produce electricity on a commercial basis. The British Government subsequently commissioned the preparation of a business plan by Mr Michael Allen of New Zealand, after which, eight and a half (8.5) million pounds were provided through DFID to the Government of Montserrat to finance the drilling of 2 production wells.
Anticipating the provision of the funds to drill the production wells, and based on information obtained from EGS Managing Director Paul Brophy during his public interviews and CRM’s discussions with him, CRM’s representative on the Energy Committee Jim Bass sent Mr Brophy an email dated 1st August 2011. Mr Bass requested that Mr Brophy confirm the necessary procedures to be put in place leading up to the drilling of the production wells that would conform to international best practice. Mr Brophy responded in precise detail by email dated 3rd August, 2011. For public record, the exact wording of his response is set out below.
‘ Jim,
Yes, you are right in recalling my comments on things to do prior to drilling. But here is a recap.
- Need to check that the rights to the resource (probably the Crown) include the right to develop it.
- Check land ownership.
- The first step is to preliminary design the well. The type of well strongly influences everything. I think we can do that ourselves based on what we know. We will need a detailed design from a drilling engineer at a later stage but at this point we can complete this task.
- Next we need to find a drilling person or company to act on your behalf – drilling agent as you mentioned. He would put the bid together and send it out to the various drilling companies. This is why we need the preliminary well design first since we need to specify depth, size of hole, etc .
- After that the drilling engineer or Agent handles just about everything.
- We also need the necessary environmental clearance to complete the drilling.
I can get you a few names of people who could act as drilling agent, but first we need to decide what type of well we want.’
6. (i) In the course of an Energy Committee meeting on the 15th May, 2012 chaired by Director of Public Works (DPW) Ron Beardsley, CRM representative Jim Bass read into the record the above listed recommendations provided by Mr Brophy. Mr Bass then gave a copy of the Brophy email to Chairman Beardsley and expressed the view that Committee members expected the procedures leading up to the drilling of the production wells would be conducted in conformity with the recommended guidelines.
(ii) During the same Energy Committee meeting of 15th May, 2012, CRM representatives Jim Bass and Ray Tyson directed the meeting’s attention to the fact that in its ‘Final Report—Geothermal Exploration in Montserrat Prepared For the Minister of Communications and Works—Government of Montserrat—January 2010,’ EGS provided drilling cost estimates, well diagrams and specifications for both slim line and production wells in Montserrat. Further reference was also made by Messrs Bass and Tyson to the vitally important recommendation that Montserrat should go directly to the drilling of a production well in addition to the Sections on ‘Production Well Drilling’, ‘Advantages of Production Wells’ and ‘Proposed Rig Type’ which are critical to this public release. The contents of these Sections are set out below exactly as presented in the EGS Report.
‘Production Well Drilling
Production wells whether they are drilled for exploration reasons or as a part of a development program, are larger diameter wells designed for producing steam and /or hot water on a continuous basis to supply a power plant. They normally require that the casing be cemented down to the top of the geothermal reservoir. The upper portion of the wells are normally 12 to 20 inches in diameter and the reservoir portion of the well is usually 7-9 inches. Often there is a perforated liner through the reservoir which prevents caving and bridging off of the well.
Advantages of Production Wells
- For any geothermal development these are the only wells that can produce fluids to a power plant.
- With the proper drilling rig they can handle any adverse drilling conditions such as high temperature and pressure as well as bad drilling formation.
- They can allow testing and sampling of the geothermal system and so the reservoir can be fully evaluated.
- With directional drilling more production wells can be drilled from a single drilling pad. In addition directional drilling allows second and third wells to be completed from the same well which can significantly reduce the resource risk.
- A much wider range of logging tools can be can be run in a production well.
Proposed Rig Type
ThermaSource recommends using an Atlas Copco Predator Drilling System or C1000. There are many truck mounted rigs throughout the world but only a few can handle the weight of the casing that will be run. A truck mounted rig is ideal for an island location because there is no need for a large 100+ ton crane. The production well rig should have a lifting capacity of 200,000 lbs or greater. ‘
7. After highlighting the importance of the above Sections within the EGS Report, Messrs Bass and Tyson stressed in the most forceful manner that the best guarantee of success in the drilling of the production well was to follow in the most precise manner, (a) Brophy’s recommendations as set out in his email of August 3rd, 2011, (b) the directional drilling requirement, and (c) the drill rig specifications as set out in the EGS final report. Then, in response to comments made by Energy Committee Chairman Ron Beardsley as to the possible use in Montserrat of the Icelandic Drilling Company (IDC) rig then operating in Dominica , Messrs Bass and Tyson expressed strong doubts as to that rig’s ability to fully meet the EGS criteria.
8. That DFID’s Dr Kimbugwe, DFID Adviser Michael Allen and Energy Committee Chairman Beardsley were preparing the contract to drill the production wells was revealed when in June 2012 Chairman Beardsley emailed CRM representative Ray Tyson a draft tender document for a drilling contract. Given the very precise procedures for tender preparation and the technical imperatives inclusive of directional drilling, drill rig power and other specifications set out in the EGS final report, CRM representatives considered the draft tender contract to be severely inadequate. Mr Tyson responded by email, referring to the EGS critical requirements such as the use of the Atlas Copco Predator drilling system with lifting capacity of 200,000 pounds or greater, directional drilling capability and wellhead design specifications. He also indicated that the drill rig must be specifically designed to drill for geothermal resource and not water, oil, or other subsurface resources. Furthermore, the drill rig operators should have more than 10 years experience drilling for geothermal power.
- CRM representatives on the Energy Committee were never allowed to see the final tender document. They subsequently understood that only a 750 horse power drill rig was tendered for instead of the EGS recommended Atlas Copco Predator Drilling System or C1000 which approximates to 1000 horse power. ( Note: Many persons within the island community are of the view that it is a 520 horse power drill rig that has been used to drill the production wells in Montserrat. Messrs Kimbugwe and Allen should confirm whether or not this is so). Most shocking however, is that a copy of the tender document obtained after the contract was signed and drilling was well under way, clearly shows that no directional drilling capability was requested. Under the heading in the tender application document specifying whether or not directional drilling was required, the preparers clearly noted N/A, that is, Not Applicable. In addition, unlike the tendering for the feasibility study, the tender for drilling the production well was placed on what is referred to within the geothermal drilling fraternity as an obscure website.
- In the procession of events that preceded the drilling of the production wells along the Cork Hill main road, the following are worthy of note.
- After the DFID engineer Mr Steve Price retired from his position in 2010, DFID was only represented at two Energy Committee meetings by Dr Kimbugwe. These meetings occurred before the British Government’s acceptance of the Business Plan and the provision of the 8.5 million pounds to finance the project.
- No Energy Committee meeting was called by Chairman Ron Beardsley between June, 2012 and December 10th, 2012. By the date of the Energy Committee meeting on December 11th, 2012, it was being rumoured within the island community that the Icelandic Drilling Company had been contracted to drill the production wells using the drill rig then in use at the time in Dominica. In the course of that meeting, Chairman Beardsley was asked by CRM representatives if that was true. He said ‘yes.’ He was then asked if the drill rig operating in Dominica was capable of directional drilling. He said ‘no.’ Later that evening at 9.55 p m he emailed CRM representatives Bass and Tyson to say that having conducted further investigation the IDC rig referred to was capable of directional drilling. (This email is available for inspection if required). The all important issue for Montserrat is this. If the IDC rig had directional drilling capability, why was it not so used as EGS had recommended in the drilling of the 2 production wells currently completed on Montserrat.
- In the course of the December 11th,2012 Energy Committee meeting, it was also revealed by Chairman Ron Beardsley that Capuano Engineering of California had been contracted to serve as the Montserrat Government ‘s agent or client representative charged with protection of the Government and community’s interest during the drilling of the production wells. Mr Beardsley revealed that in pursuit of this arrangement he had travelled to California to meet with Capuano Engineering officials. CRM representatives were never told about the impending visit to California, the nature of the proposed discussions, or the actual terms of the contract. Fortunately, though surprised, Messrs Bass and Tyson had no problem with the appointment of Capuano Engineering as they were fully aware of the company’s history, the excellent reputation and extensive experience of some of its senior executives relative to the drilling of geothermal wells and their involvement in other key areas of the industry.
- CRM has provided the factual information above to support its contention that after the preparation of the Business Plan and the British Government’s provision of the 8.5 million pounds to drill the production wells, CRM representatives and other members of the Energy Committee were effectively excluded from meaningful participation in the procedures leading up to the actual drilling process by Chairman Ron Beardsley, the Head of the DFID office on Montserrat Dr Kato Kimbugwe and Mr Michael Allen who prepared the Business Plan. The disappointing if not failed results from the production wells drilled to date are their responsibility alone.
Presently, at the end of June 2014, the 8.5 million pounds have provided to the people of Montserrat, production wells Nos. 1 and 2 demonstrating clearly limited or in our view disappointing performance. Well No 1 at the entrance to the road leading to Foxes Bay has had to be stimulated with pumped water. At well No 2 situated on the Corkhill road across from the former Seventh Day Adventist School, as stated by the Ministry of Communications and Works engineer monitoring the drilling exercise, the internal diameter of the drill pipe at the bottom of the well is only 4 inches. This diameter, as pointed out above within the EGS feasibility study is inadequate for conventional commercial operation.
Listeners to Radio Montserrat and readers of the Montserrat Reporter newspaper will remember the statements put out by the DFID office that the final test reports relating to the completion of the production wells would be available by October 2013. Other deadlines have been set including March 2014 and July 2014. What is unequivocally clear from the statements made to the Montserrat media and broadcast on Radio Montserrat, are the efforts being made by Messrs Kato Kimbugwe and Michael Allen to exonerate themselves of blame in respect of the disappointing results obtained so far from the 2 production wells. (Please note: former Energy Committee Chairman DPW Ron Beardsley left Montserrat permanently in late November 2013.)
To illustrate the efforts to shift blame by the 2 gentlemen indicated above.
- Dr Kato Kimbugwe.
During a joint press conference with His Excellency Governor Adrian Davis and Dr Kimbugwe broadcast on Radio Montserrat on Thursday 13th February, 2014, reporter James White Jnr asked a question concerning delays with the geothermal exploration in terms of equipment capacity and sourcing of the right equipment in the planning stages. Dr Kimbugwe made a lengthy response listing the scale of the 8.5 million pound investment and the number of international experts put in place to develop the resource. He said, and we quote, “Mike Allen who leads that unit is an internationally renowned expert. Google him and find out what projects he’s worked on all over the world. Paul Brophy, international expert. IDC is the number one geothermal drilling company in the world. Iceland relies on 99.9% of its energy to come from geothermal. We got the number one company that has developed most of their wells in Iceland. So I take my direction, advice from geothermal experts and that’s the way we should be doing it.” This effort to justify the direction in which the drilling of the production wells has gone as being the result of advice given to him by international experts underscores the points CRM has been making above as the reasons for our concern. Dr Kimbugwe seems not to have properly read the EGS feasibility report and their recommendations. Added to this, it is clear that Mr Brophy’s preparatory steps set out in his email of 3rd August, 2011 to Jim Bass and thus to the Energy Committee were not followed by Messrs Kimbugwe, Allen and Beardsley. Capuano Engineering was only hired as the client’s agent to ensure adherence to the drilling contract that Kimbugwe, Allen and Beardsley masterminded. IDC as the drillers only executed the contract requirements.
- Mr Mike Allen.
On Tuesday 1st April, 2014, Mike Allen was the featured speaker at what was described in the introductory remarks as a “geothermal press conference.“ Personalities present included DFID’s Dr Kato Kimbugwe, the Government of Montserrat’s Director of Information and Communications Mr Mike Jarvis, Mr Bennette Roach of the Montserrat Reporter, senior staff of the Ministry of Communications and Works, and the Manager of Montserrat Utilities. Mike Allen’s remarks on the geothermal project inclusive of the drilling and testing of the production wells were quite lengthy. Within the following 3 weeks this press conference was rebroadcast several times on Radio Montserrat. Some of the statements that he made are of great concern to CRM. They include the following.
- ‘ The harsh reality is that to get the best resource we need, we would like to be closer to the volcano and obviously we can’t be there because of the exclusion zone. So in geothermal terms we are sitting on what we call an outflow………….We would like to get as close to the centre as we can but physically we are restricted because of the exclusion zone.’
- ‘ The answer is that if the volcano were quieter and we could get closer to it and we could go around towards Plymouth………..’
- ‘ So it’s really being able to expand the area, so we’ve started to prove the reservoir but I think we know that we need to move towards the volcano and in general in that direction probably to get larger production.’
[ CRM’s Comment: These remarks at (a), (b), and (c) are an acknowledgement of a better result being obtained by having closer access to Plymouth and quite likely the main heat resource reservoir. This proximity to the Plymouth objective would definitely have been achieved by the inclusion in the drilling contract of the EGS recommended directional drilling and related specifications.]
- During Mr Allen’s discourse on well testing, Bennette Roach asked him a question. ‘What do you mean by airlift?’ Allen responded in part. ‘Well, we basically put air into the well to start the well flowing because the well doesn’t flow without some stimulation etc.’
- Bennette Roach asked another question. ‘ We are beyond the stimulating process?’ Allen responded as follows. ‘Well, we have to do that every time we turn the well on and off. The well sits there with the water level. We just have to lift the water out of the well and then the well starts to flow. SOME WELLS FLOW NATURALLY AND OTHER WELLS HAVE STIMULATION. SO WE HAVE TO DO THAT EACH TIME WE STOP AND START THE WELL.’ [CRM’s emphasis.]
[ CRM’s Comment: With these remarks and several others not included in these public statements that were made by Mr Allen during this press conference, CRM considers it fair to ask the following question among others. Due to the failure to fully adhere to the EGS instructions for the drilling of the geothermal production wells, instead of ‘gusher ‘ type emissions of fluids and / or steam, will the resource flow from the wells drilled so far have to depend on such measures as water stimulation? Former employees of the Montserrat Water Authority will recall that many years ago while drilling for water in the lower Belham River Valley, with the right equipment and drilling at the right spot, the offshore drilling company hit the expected ‘gusher’ of water.]
CONCLUSION
The foregoing information and related observations are the bases on which CRM has determined that the disappointing if not failed results of the 8.5 million pound project to drill two geothermal production wells on Montserrat, can in large measure, be attributed to the exclusion of the Energy Committee/CRM from the decision making process after the UK Government made the project funds available. As indicated above, this exclusion was orchestrated by the DFID Head of Office in Montserrat Dr Kato Kimbugwe, the DFID Geothermal Adviser for the project Mr Mike Allen, and the former Director of Public Works and Energy Committee Chairman at the time Ron Beardsley. This act of exclusion in taking forward this (or any other major) project, highlights an issue with serious implications for Montserrat. It is this. In spite of the fact that they were spending millions of pounds specifically assigned to Montserrat for a project that could have totally transformed the Montserrat economy for decades to come, neither Mike Allen, Dr Kimbugwe or Ron Beardsley were accountable to any local entity that could have demanded full compliance with the EGS feasibility study, asked searching questions, or seek other opinions or advice within the world wide geothermal industry. No Government of Montserrat should allow this to happen at any time.
Against the background of the failings experienced with the 2 production wells drilled so far, CRM and the general public in Montserrat have been informed at various press conferences that the British Government has agreed to finance the drilling of a third production well. Accordingly, CRM delegations have met with the Minister with responsibility for Energy the Hon. Charles Kirnon (on 9th April, 2014), His Excellency Governor Adrian Davis (on 1st May, 2014), and the Hon. Premier Reuben Meade (on 10th June, 2014), and expressed in precise detail our concerns outlined above in this public release. To each of the 2 Ministers and the Governor, CRM requested that whenever the 3rd production well is to be drilled, it should not be left entirely to DFID’s Dr Kimbugwe, Mr Mike Allen and anyone else designated by them, but the Energy Committee on which CRM is represented should fully participate in the preparation of the tender. These tender arrangements to include adherence to the EGS recommended directional drilling, drill rig power and lifting capability, supervisory arrangements, etc, in addition to tender advertisement, tender evaluation and the selection of the drilling company.
