French specialist in seamless tubes Vallourec has announced a contract worth a potential $800 million over five years to support American company Fervo Energy in deploying geothermal energy in the United States, particularly for data centers.
Vallourec mainly produces for the oil industry but can use its expertise for other applications, such as geothermal energy that generates electricity from heat in the ground, explained Vallourec’s CEO Philippe Guillemot to AFP.
Geothermal energy, developed by Fervo Energy, aims to produce a large quantity of this base-load electricity without greenhouse gas emissions, unlike gas-based electricity production dominant in the US.
The process involves extracting the necessary heat from rocks to run a turbine for electricity generation, using similar techniques as for unconventional oil and gas extraction.
Vallourec, which faced bankruptcy in the early 2020s, will be the exclusive supplier to Fervo Energy for five years through its partner Sooner Inc, building a fully US-based supply chain for critical geothermal well infrastructures.
The contract could generate up to $800 million in revenue over its duration for Vallourec, a significant operation for the company. They aim to increase their geothermal product orders by more than threefold in 2025 compared to previous years, with a focus on transitioning to new energy sources including geothermal, hydrogen, biomass, and carbon capture, utilization, and storage (CCUS) by 2030.
