Geothermal Startup Mazama Energy Raises $135M to Drill Deeper into Super-Hot Rock
Khosla-backed geothermal startup Mazama Energy has closed an oversubscribed $135 million Series B to develop horizontal wells drilled into super-hot rock. The company now says its first Oregon site could produce 10 gigawatts of electricity, up sharply from last year's estimate.
Geothermal startup Mazama Energy announced Thursday that it closed an oversubscribed Series B funding round worth $135 million. The capital will support development of horizontal wells drilled into super-hot rock, with each well potentially capable of generating up to 15 megawatts of electricity.
The company expects to begin generating electricity sometime next year. Its first site, located in Oregon, is now estimated to be capable of producing 10 gigawatts of electricity — a significant increase from the 5-gigawatt estimate investor Vinod Khosla gave last year.
Drilling deeper, reaching hotter rock
Unlike conventional geothermal projects, enhanced geothermal companies like Mazama are targeting deeper, hotter rock formations. The company has already drilled past 10,000 feet in just 15 days, working toward a target depth of roughly 15,000 feet. At that depth, temperatures reach around 750°F (400°C), and under high pressure, water enters a "supercritical" state — neither fully liquid nor fully gas — that can absorb far more energy than ordinary steam. Mazama says this allows each well to generate up to 10 times more power than traditional geothermal technology.
According to estimates from the University of Twente and the Clean Air Task Force, tapping just 1% of the world's super-hot rock resources could generate more than 63 terawatts of electricity. Enhanced geothermal technology is increasingly viewed as a contender in meeting the growing electricity demands of AI data centers and other large grid loads, even as many tech companies currently lean toward natural gas for that purpose.
Mazama has already secured land for a second development site. The company aims to complete development of its first site by 2030, at which point it expects to generate 200 megawatts of electricity.
The new funding round was led by Centaurus Capital and Doerr Capital, with participation from ConocoPhillips and Shell Ventures. Existing investors Khosla Ventures and Gates Frontier returned, while new investors included SiteGround Capital, H. Barton Asset Management, and the Jeffrey and Marieke Rothschild Foundation. Mazama Energy was originally incubated at Khosla Ventures.
