They say that even in the dead of a Yellowknife winter, workers at the old Con mine on the edge of the city used to come up from the depths dressed in T-shirts and shorts due to the heat from the bedrock.

Now the N.W.T. capital is considering using that heat to extract a different kind of gold from the defunct mine — cheap, greenhouse gas-free energy to warm its buildings on frigid Arctic nights.

Early in 2008, Yellowknife will begin studying what could eventually become Canada's first large-scale geothermal heat plant.

"We've got heat resources below our community," said Mark Henry, the city's energy co-ordinator. "We just have to come up with a way to move it."

Yellowknife is ideally positioned to take advantage of geothermal energy, said Mory Ghomshei, a University of British Columbia engineering professor who's been pushing the idea since 1988.

"We've been working on that for the last 25 years, waiting for the right time and the right place," said Ghomshei, who has already completed one report on the project for the city and is expected to bid on a feasibility study.

Con's deep gold mining shafts to be tapped

Geothermal energy is heat created by pressure deep within the earth. Temperatures rise 20 to 30 degrees per kilometre of depth, said Ghomshei, and the Con mine reaches down 2.5 kilometres.

The Con is a former gold mine now being decommissioned by its owners, Newmont Mining. As part of that decommissioning process, the mine's shafts and stopes (excavations forming steps) are being allowed to slowly fill with water.

Water in the bottom of the mine's Robertson shaft now simmers at up to 50 degrees. That's not hot enough to generate electricity, but Ghomshei said it's plenty hot enough to keep downtown buildings toasty warm.

By pumping hot water up from the depths and capturing that heat before it's reinjected into the mine, Ghomshei's report estimates the Con mine could provide up to 650,000 gigajoules, or 20 megawatt-hours, of heat on an ongoing, sustainable basis.

That's enough for about half of Yellowknife's 19,000 residents.

It's an ideal project to illustrate the benefits of geothermal energy, said Ghomshei.

The old mine is right on the city's doorstep. Nearly three-quarters of the city's energy costs are for space-heating. And partly because the city doesn't have access to natural gas, energy costs three times as much in Yellowknife as it does in, for example, Edmonton.

"This is a unique situation," he said. "All the components of success are there."

Ghomshei's preliminary estimates suggest that an $800,000 demonstration project producing 300 kilowatt-hours of heat should pay itself off in reduced energy costs in eight to nine years. The payoff of a full-blown, 20 megawatt-hour system could be in as little as three years.

Geothermal projects underway around the globe

Ghomshei said 30 countries around the world are using geothermal energy. Geothermal power plants in California tap into the underground turmoil of the San Andreas fault to produce hundreds of megawatt-hours of power.

A pilot project at the old Springhill coal mine in Nova Scotia now heats industrial buildings on the site and produces about 600,000 kilowatt-hours. Ghomshei is also working on projects with some deep mines in the Sudbury area.

Relatively low energy prices, however, have kept the energy source almost nonexistent in Canada.

Strong local interest, says city official

Henry said the project has excited plenty of interest in Yellowknife.

"Hugely interested," he said. "I have a hard time getting through presentations because everybody's sticking their hands up."

The feasibility study will be awarded early in the new year. If all goes well, Henry said it's "not unrealistic" that Yellowknife could be drawing heat from the same hole it used to draw gold within four or five years.