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Geothermal power generation from abandoned oil wells is a new way to utilize geothermal energy. An analysis model based on transient formation heat transfer is presented in this paper. Through the double-pipe heat exchanger, R143a is used as working fluid for obtaining geothermal energy from abandoned oil wells. The influence of insulation on heat transfer from the recovery well to the injection well is investigated. The result shows that the outlet temperature of fluid leaving the recovery well gradually increases with thickness of insulation increasing. The outlet temperature of fluid with the insulation of 0.03 m polystyrene drops by 6 K as compared to the outlet temperature with the perfect insulation. At the same thickness of insulation, the difference of the outlet temperature between with the insulation of polystyrene and with the perfect insulation decreases with the inlet velocity of fluid entering the injection well increasing.