SCOTTISH companies that are concerned a fall-off in the oil and gas sector could lead to lost business and jobs can take heart if the showing at a major trade fair and congress in Germany was anything to go by.

GeoTHERM 2024 in Offenburg was billed as Europe’s largest geothermal trade fair, with more than 6500 attendees and more than 240 country and company exhibitors showing up in late February.

The Scottish contingent of 16 companies, from drilling consultant and adviser Merlin to equipment developer GA R&D, worked around the Scottish stand to explore opportunities in Germany and beyond and to ease Scotland’s transition out of a sunset sector into a sustainable sunrise industry.

The relevance of Scotland’s deep-drilling and pipeline-building expertise is obvious just in the name for deep geothermal projects, drilling down from 3km to 10km to tap hot rock – petrothermal systems.

The old and the new energy businesses are so compatible that companies can transfer their processes, products and expertise with relative ease. Stewart McGregor, senior drilling engineer at Merlin, said: “Drilling geothermal wells is fundamentally the same as when drilling oil and gas wells.

READ MORE: Scottish Greens condemn plans to restart drilling in abandoned North Sea field

“Merlin sees the same issues in both conventional and geothermal drilling – a workforce which lacks the experience and competence of the previous generation. The fundamental economics of geothermal projects are sensitive to drilling cost overruns, which means it has to be done right first time.”

There’s great potential for Scottish companies looking to make this transition – and for the nation as a whole.

Steve Taylor, Scottish Development International (SDI) trade adviser on renewable energy in Germany, points out that: “A 2022 report by the Optimat consultancy for Scottish Enterprise identified 220 oil and gas supply chain companies with capabilities that offer the potential for diversification into the geothermal sector.

“The report highlighted well engineering, sub-surface modelling, corrosion mitigation and data analysis as key areas with the potential to create or sustain 37,000 direct jobs in Scotland.”

Given that the same report forecast that up to 270,000 jobs could be created along the supply chain, geothermal could join other renewable energy opportunities in creating far more jobs for Scotland than the 13,800 that Scottish Government figures say were supported by oil and gas in 2021.

Germany is an especially attractive target for Scottish businesses expanding into geothermal. George Galloway, director and principal consultant at Netherlands-based GeoTechInvest BV, said: “The local supply chains in many countries looking to grow their geothermal capacity fall well short of the required resources. In Germany this is indeed the case, meaning Scottish businesses traditionally servicing oil and gas operators should be well-placed to transition their business across to geothermal and access these overseas opportunities.”

Craig Duncan, business development manager at Aberdeen-based drilling operations consultant ADC Energy, said: “Experience gained on oil and gas drilling rigs is directly transferable to rigs used to drill geothermal wells. Scotland has the full breadth of capabilities to ensure both Germany’s and Scotland’s geothermal ambitions are made a reality.”

Taylor added: “If these skills can be utilised in the German market, the potential is huge. The German government has indicated it will set a target for the number of geothermal plants to grow ‘tenfold’, while the city of Munich alone has identified a budget of more than €1 billion to design and implement new deep geothermal wells and city heating networks, starting immediately.

“The Fraunhofer Institute has prepared a roadmap for the German government to direct geothermal activity and has identified potential for more than 300 TWh [terawatt hours] of annual power which would replace fossil fuels and provide 50% of Germany’s municipal heat by 2030.”

SDI calls this “The Just Transition: Using Scotland’s oil and gas experience to develop a new supply chain of geothermal companies”, and judging from the engagement in Offenburg, that’s precisely what is happening.

Scotland is already a wind and wave energy leader, punching well above its weight in installed capacity and in expertise. The geothermal opportunity could give it leadership in yet another area of renewable energy – while transitioning its petrochemical legacy for the future.

Paul St John Mackintosh is a journalist and writer resident in France