Economic limits of horizontal spacing for U-shaped closed-loop geothermal well conversion from two abandoned petroleum wells

Converting abandoned petroleum wells (APWs) into U-shaped closed-loop geothermal wells (UCGWs) offers an effective solution to the high drilling costs that hinder the large-scale deployment of geothermal energy. This study, for the first time, incorporates monetized social benefits into an evaluation framework and establishes a techno-economic coupling model to assess APW-to-UCGW conversion. Using a representative project in the Sichuan Basin as a baseline, this study quantifies the economic limit of horizontal spacing—defined as the maximum spacing at which Net Present Value (NPV) ≥ 0 and discounted payback occurs within 30 years—as a practical screening metric. The results indicate that, the baseline economic limit of horizontal spacing for direct-use heating is 1100 m, whereas no economically feasible limit is identified for electricity generation within the evaluated spacing range. A combined strategy—installing 1000 m of insulation along the ascending wellbore, reducing drilling costs by 20%, providing a 30% government one-time subsidy on capital investment, and increasing the carbon emissions price to 20 $/t—shifts the viability boundary substantially, increasing the economic limit for direct-use heating to 4100 m. These findings provide a scientific basis and practical guidance for promoting the geothermal reuse of APWs under evolving energy and carbon policies.