Eavor removes drilling rigs as Geretsried geothermal project stalls

Energy company Eavor is removing both drilling rigs from Geretsried, putting construction of the project’s second geothermal loop on hold indefinitely. The delay leaves the Bavarian town’s district heating plans uncertain, BR reports.

Eavor said the cost of keeping the rigs and related services in place while they are not being used prompted the decision. The company has not said when work on the second loop might resume.

Geretsried said it was disappointed and criticised Eavor for informing the town and Isar Loisach Naturwärme GmbH only at short notice. The town and Eavor have had a heat supply contract since 2024, but the project’s changed conditions mean its capacity and economic viability must be reassessed. Without a firm schedule for the second loop, the town cannot reliably plan when district heating will begin or how widely it can be expanded. It is also considering alternative or complementary ways to generate heat.

The project uses a closed system of pipes deep underground, where circulating water absorbs heat from hot rock. The technology is intended to make geothermal energy usable in places without naturally occurring thermal water.

Construction of the first loop faced technical problems after the two vertical wells were not cemented sufficiently, according to Eavor. Drilling fluid and cuttings entered sections that had already been drilled horizontally, forcing the company to carry out work sequentially rather than in parallel.

Twelve pairs of horizontal wells were originally planned. Six were completed, but only four of those were finished in full. The facility first fed electricity into the public grid in December 2025. Eavor said its electrical output was most recently about 8.5 megawatts. The planned district heating supply has not yet started.

The delay also raises questions about financing. The European Innovation Fund approved a grant of 91.6 million euros for the project, and a loan of up to 45 million euros from the European Investment Bank was announced. It is not yet clear how the postponement affects either financing arrangement, how much of the grant has been paid out or whether any funds would have to be repaid. BR said it had asked the EU fund for information but had not received a response.

Eavor continues to describe Geretsried as a flagship project, with experience gained there intended to inform further facilities. But the removal of the rigs and the indefinite postponement of the second loop leave the timing of the town’s planned district heating supply unclear.