KenGen Risks Losing Olkaria Wells Over 18-Year Licence Blunder Kenya Electricity Generating Company (KenGen) faces a serious legal and operational risk at Olkaria after an error in the coordinates of its geothermal licence left part of the company’s wells, steam infrastructure and other assets outside its legally recognised area. The licensing mistake, made nearly two decades ago, remains unresolved despite the Ministry of Energy and Petroleum acknowledging the problem in 2017. The dispute has raised questions about the security of KenGen’s investments, the government’s management of geothermal resources and the potential consequences for Kenya’s electricity supply. Olkaria is the country’s most important geothermal centre and accounts for the overwhelming majority of Kenya’s installed geothermal generation capacity. Licence Error Exposes Strategic Assets The problem dates back to September 19, 2008, when the Ministry of Energy and Petroleum issued KenGen a licence covering ...
Gran Canaria’s Geothermal Push Enters New Phase as Drilling Tender Preparations Begin
The latest momentum comes as the Cabildo formally seeks another permit to investigate geothermal resources across strategic areas of the island. At the same time, authorities and project partners are preparing technical tender documents for exploratory geothermal drilling operations expected to begin in the coming development phases.
Together, these developments signal that geothermal energy is no longer being treated as a distant scientific possibility in Gran Canaria. It is increasingly emerging as a central pillar of the island’s future energy strategy.
For the Canary Islands, geothermal energy represents far more than renewable electricity generation. It represents energy independence, economic resilience, industrial modernization, and long-term protection against volatile global fuel markets.
As Europe searches for stable clean energy sources capable of supporting modern electricity systems twenty-four hours a day, Gran Canaria’s volcanic underground resources are beginning to attract growing attention.
Gran Canaria’s geothermal drilling push is being driven by a coordinated network of key players combining policy, science, engineering, and finance. The Cabildo de Gran Canaria and Gran Canaria Geotermia S.L. provide strategic leadership and project coordination, while INVOLCAN and ITER deliver critical scientific and subsurface expertise. International drilling know-how from Dando Drilling and advisory support from JRG Energy strengthen execution capability, and funding from IDAE ensures financial backing for high-risk exploration. Together, these partners are aligning to de-risk drilling and accelerate the island’s move toward commercial geothermal energy.
Gran Canaria’s Volcanic Advantage
Gran Canaria possesses one of the most important ingredients required for geothermal energy development: volcanic geology.
The island was formed through volcanic processes over millions of years, creating underground thermal systems that scientists believe may contain commercially viable geothermal reservoirs. These reservoirs could potentially provide continuous renewable electricity independent of weather conditions.
Unlike solar and wind energy, geothermal energy does not depend on sunshine or wind speeds. Instead, geothermal plants tap into heat stored beneath the Earth’s surface, allowing power generation around the clock.
This is particularly important for isolated island grids like those of the Canary Islands.
Island electricity systems often struggle with renewable intermittency. While solar and wind power can provide substantial clean electricity, fluctuations in weather conditions create balancing challenges for isolated grids with limited interconnections.
Geothermal energy solves part of this problem because it provides stable baseload power.
For Gran Canaria, geothermal could eventually become the backbone supporting a wider renewable energy transition.
New Exploration Permit Signals Growing Confidence
The Cabildo’s latest application for another geothermal investigation permit demonstrates growing institutional confidence in the island’s underground heat potential.
Exploration permits are critical in geothermal development because they allow authorities and project developers to conduct geological mapping, geochemical analysis, seismic surveys, temperature measurements, and eventually exploratory drilling.
These investigations help determine whether underground formations contain sufficient heat, permeability, and fluid characteristics to support commercial geothermal production.
Previous studies already identified southeastern parts of Gran Canaria as highly promising geothermal zones. Municipalities including Telde, Ingenio, Agüimes, and Valsequillo have repeatedly appeared in geothermal assessments conducted by regional energy authorities and scientific institutions.
The new permit request appears designed to expand and deepen those investigations.
This also reflects a broader strategic shift within the Canary Islands, where geothermal energy is increasingly viewed as a realistic long-term energy solution rather than a speculative research concept.
Drilling Tender Preparations Are Already Underway
Perhaps the most important recent development is that preparations for geothermal drilling tenders are reportedly already advancing.
According to regional reports, the public-private company Gran Canaria Geotermia SL is preparing the technical tender specifications for exploratory drilling operations in the southeast geothermal zone of the island.
This is a major milestone.
In geothermal development, moving from geological studies to drilling preparation represents the transition from preliminary research toward industrial implementation.
The planned exploratory wells are expected to reach depths of approximately 2.6 to 2.7 kilometers beneath the surface. At these depths, developers hope to confirm commercially viable geothermal temperatures and reservoir conditions.
Exploration drilling is among the most critical and expensive phases of geothermal development.
Unlike solar or wind projects, geothermal resources remain hidden underground until drilled and tested. Developers must invest substantial amounts of capital before knowing whether a geothermal reservoir can support long-term commercial operations.
The drilling campaign planned in Gran Canaria therefore represents a major financial and technical commitment.
Reports indicate the geothermal initiative could involve investments approaching €30 million, with support linked to Spain’s Institute for Energy Diversification and Saving (IDAE) and broader clean energy funding mechanisms.
This level of investment signals that geothermal energy is becoming strategically important for Gran Canaria’s long-term energy planning.
Public-Private Collaboration Driving the Project
The geothermal initiative in Gran Canaria is being advanced through collaboration between public institutions, scientific organizations, and private sector entities.
Gran Canaria Geotermia SL reportedly plays a central role in coordinating the project. The initiative also involves the Cabildo de Gran Canaria, the Consejo Insular de la Energía, and the Instituto Volcanológico de Canarias (INVOLCAN).
This collaborative model is increasingly common within the geothermal industry because geothermal projects involve substantial financial risk and technical complexity.
Exploration drilling alone can cost millions of euros per well.
By combining public institutional backing with private technical expertise, Gran Canaria aims to reduce development risk while accelerating project execution.
Public-private cooperation also improves access to financing opportunities and European clean energy support programs.
Why Europe Is Suddenly Interested in Geothermal
Gran Canaria’s geothermal expansion is occurring during a period of growing geothermal momentum across Europe.
Several factors are driving renewed interest in geothermal energy:
- Rising concerns about energy security
- Pressure to reduce imported fossil fuel dependence
- Electricity price volatility
- Decarbonization targets
- Advances in drilling technologies
- Growing demand for stable renewable baseload electricity
Unlike intermittent renewables, geothermal plants provide continuous generation capable of stabilizing electricity systems.
This makes geothermal especially valuable as renewable penetration increases.
Countries including Iceland, Italy, Germany, France, Türkiye, and the Netherlands are already expanding geothermal development programs for electricity production and heating applications.
Now Spain appears increasingly interested in joining that geothermal resurgence.
The Canary Islands Could Become Spain’s Geothermal Hub
Historically, Spain focused heavily on solar and wind deployment while geothermal energy received comparatively little attention.
However, the Canary Islands may change that.
The volcanic nature of the archipelago creates favorable geothermal conditions rarely found elsewhere in Spain. Scientists have long believed that islands including Gran Canaria, Tenerife, and La Palma possess significant geothermal potential.
If commercial reservoirs are successfully confirmed through drilling, the Canary Islands could eventually become Spain’s leading geothermal region.
That could transform both regional energy policy and national renewable strategies.
A successful geothermal industry would not only reduce fossil fuel imports but could also attract international geothermal companies, drilling contractors, researchers, and technology developers.
Why Geothermal Matters for Island Energy Systems
For island territories, geothermal energy carries strategic advantages that extend beyond climate policy.
Island grids are inherently vulnerable because they often depend heavily on imported fuels. Shipping disruptions, fuel price spikes, and geopolitical instability can rapidly affect electricity prices and economic stability.
Geothermal energy offers local, domestic, continuously available power generation.
That means Gran Canaria could eventually generate part of its electricity supply using heat sourced directly beneath the island itself.
This concept — energy sovereignty — is becoming increasingly important worldwide.
By developing geothermal resources, Gran Canaria could improve energy independence while reducing exposure to volatile international fuel markets.
Geothermal Could Support Multiple Industries
The benefits of geothermal development extend beyond electricity generation alone.
If successful, geothermal resources in Gran Canaria could support:
- Industrial heating
- Agricultural greenhouse systems
- Desalination facilities
- District cooling
- Tourism infrastructure
- Green hydrogen production
- Food processing industries
- Data center cooling and energy supply
Continuous geothermal power could also support industrial operations requiring reliable twenty-four-hour electricity.
This could help diversify the economy of the Canary Islands while attracting energy-intensive industries seeking stable renewable energy sources.
Technical Challenges Remain Significant
Despite growing optimism, major challenges still remain.
Geothermal exploration is technically difficult and financially risky.
Underground reservoirs must contain:
- Sufficient temperatures
- Adequate permeability
- Sustainable fluid circulation
- Favorable geological structures
Not every exploratory well succeeds.
Some geothermal wells encounter temperatures that are too low for commercial generation. Others fail to produce adequate flow rates. In certain cases, additional stimulation technologies are required to improve reservoir productivity.
Drilling itself is also expensive.
High-temperature drilling environments place extreme stress on equipment, requiring specialized materials and engineering expertise.
Infrastructure challenges must also be addressed, including:
- Transmission integration
- Water management systems
- Reinjection facilities
- Environmental monitoring
- Seismic risk assessment
Authorities will need to carefully manage environmental and social concerns throughout the project lifecycle.
Technology Is Changing the Geothermal Industry
Modern drilling technologies are helping reduce some geothermal development risks.
Many geothermal techniques now borrow innovations originally developed within the oil and gas sector, including:
- Directional drilling
- Advanced well logging
- Reservoir simulation
- Real-time drilling analytics
- High-temperature materials engineering
Enhanced Geothermal Systems (EGS) technologies may also expand future opportunities.
EGS techniques aim to create productive geothermal reservoirs even in regions lacking natural permeability by engineering underground fracture networks.
If these technologies continue improving, geothermal resources previously considered marginal could become commercially viable.
Gran Canaria may eventually benefit from these technological advances.
Lessons From Iceland and the Azores
Gran Canaria’s geothermal ambitions are often compared with volcanic island geothermal success stories elsewhere.
Iceland remains the global benchmark for geothermal development. The country generates large portions of both electricity and heating from geothermal resources.
Closer to the Canary Islands, the Azores demonstrate how volcanic islands can successfully integrate geothermal energy into isolated electricity systems.
On São Miguel Island, geothermal power already contributes significantly to electricity supply.
These examples reinforce growing confidence that volcanic Atlantic islands can successfully develop geothermal industries when supported by long-term investment and policy stability.
Geothermal Could Reshape the Canary Islands’ Future
If drilling confirms commercially viable geothermal reservoirs beneath Gran Canaria, the implications could be transformative.
The island could eventually:
- Reduce imported fuel dependence
- Lower long-term electricity costs
- Increase renewable energy penetration
- Improve grid stability
- Attract clean energy investment
- Create highly skilled technical jobs
- Strengthen industrial competitiveness
- Position itself as a geothermal innovation hub
For a region heavily dependent on tourism and imported energy, geothermal development represents an opportunity to build long-term economic resilience.
The project could also elevate the Canary Islands’ international profile within the global renewable energy sector.
A Defining Moment for Spanish Geothermal Development
The Cabildo’s latest exploration permit request and the parallel preparation of drilling tenders suggest that Gran Canaria is entering a defining stage in its geothermal journey.
For decades, geothermal discussions in the Canary Islands largely remained within scientific and exploratory circles.
Today, the conversation is changing.
Permits are advancing. Funding mechanisms are emerging. Technical drilling plans are being prepared. Public-private partnerships are forming. Institutional support is strengthening.
Most importantly, the urgency surrounding energy security and decarbonization is accelerating political momentum.
Gran Canaria now appears determined to move beyond geothermal theory and toward real-world implementation.
Whether the island ultimately succeeds will depend on exploration results, drilling performance, financing stability, environmental management, and long-term policy commitment.
But one thing is becoming increasingly clear: geothermal energy is rapidly evolving into one of the most strategically important renewable energy priorities in the Canary Islands.
As Europe searches for stable, carbon-free baseload energy capable of supporting the clean energy transition, Gran Canaria’s volcanic underground may soon become one of the continent’s most closely watched geothermal frontiers.
See also:Mercury Expands New Zealand Geothermal Platform With Billion Dollar Investment
source:Canarias7,B2B March, Lagacetadecanarias, Ondaguanche,
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