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CO2-Enhanced Oil Recovery: Increasing U.S. Energy Security
through Climate Legislation
George PeridasScientist, Climate Center
With thanks to John Steelman (NRDC) and Mike Godec (ARI)
June 29th, 2010
Outline
CCS in proposed climate legislation
How CO2-EOR works
U.S. CO2-EOR potential
CO2-EOR under climate legislation
Benefits and safeguards
CCS provisions in the W-M, K-B bills
• Fixed 10-yr subsidy for up to 72GW of CCS eliminates carbon price volatility– Initially $90/t (W-M) - $96/t (K-B) for 85% capture or more; $50/t
for 50% capture; sliding scale in between– Additional $10/t if built before 2017– 15% of pool set aside for industrial sectors
• W-M performance standards for new coal plants:– Plants permitted 2009-2020 must achieve 50% reduction– Plants permitted 2020- must achieve 65% reduction, 4yrs after
minimum national installed capacity and injection volume/type thresholds are met, or by 2025 at the latest. (Possible 18-month extension)
• K-B performance standards for new coal plants:– Slightly higher trigger thresholds for plants permitted 2010-2020,
with compliance by 2020 at the latest for those.
How does CO2-EOR work?
JAF01981.CDR
Zone ofEfficient Sweep
Purchased CO2Anthropogenic and/or
Natural SourcesInjected
CO2
Immobile Oil
Immobile Oil
Recycled CO2 from
Production Well
COStored in PoreSpace
2 CO Dissolved (Sequestered)in the Immobile
Oil and Gas Phases2
DriverWater Water Miscible
ZoneOil
BankAdditional
OilRecovery
CO2 CO2
Source: Advanced Resources International
• Economic potential between 38-58 bn bbl, at $70/bbl and $45/t CO2
• CO2 demand between 10-12 bn tons• 75% of lower-48 potential in four basins in Gulf,
Texas, Mid-Continent
EOR and CO2 demand in lower 48
W-M: How much CCS, CO2?
4-6 bcf/day by 2020; 12-27 bcf/day by 2030
NRDC: CCS and EOR under ACES (lower 48)
• By 2050:– 201GW of CCS plants– 20 billion tons of captured CO2– 37 billion barrels from CCS/EOR
• Assumes:– $58/bbl<oil prices<$90/bbl– CO2 priced at $15/ton or less
• Assumes “best practices” at that oil price range• Up to 60 billion barrels become economical at higher oil
prices (>$90/bbl) and using “next generation” techniques
MARKAL model looks at optimal technology deployment nationally over full policy period.
Regional results (lower 48)
• By 2030:– 69-108 GW of CCS plants deployed– 410-530 million tons of CO2 captured per year
• CO2 EOR included but not linked to CCS deployment. Geologic reservoir data not included.
• As early as 2026, however, enough CCS is deployed to meet the total CO2 demand for EOR in the lower 48.
• EOR potential of 3-3.6 million barrels per day by 2030, 40% of current imports.
NEMS model is more predictive, looks at technology costs and decisions by power region, but only out to 2030.
Regional results – Lower 48• Regional imbalances in
CO2 supply/demand
• 77% of CO2 supply within economic distance of 77% of EOR potential
• Inter-regional pipelines
Power region CA NW MAPP SPP ERCOT SERC MAIN ECAR MAAC
GW by 2030 1.6 0.9 5.8 4.8 2.7 23.9 6.1 19.8 8.7CO2 captured over 30 yrs
301 169 1090 902 508 4493 1147 3722 1636
Oil basin CA WY, UT, CO
MT, ND, SD
NE, KS, OK
NM, W.TX
E. TX LA, MS, AL
MI, IL OH, KY, PA
CO2 demand 1459 735 125 1758 3078 2182 812 365 41
A possible transportation network
Source: Advanced Resources International
Benefits and safeguards
• CO2-EOR compared to drilling offshore/in protected areas:– Faster to deploy than drilling offshore or in protected areas– Far more is known about reserves– Far larger potential:
• API estimates 286,000 bbl/day from new offshore areas by 2030• Our analysis showed 3 million bbl/day by 2030 using CO2-EOR
– Utilizes existing infrastructure and developed fields
• Must have:– Minimize the risk of air or water pollution and harmful surface
disturbance through:• Responsible operations• Effective environmental regulations
– Regulatory framework to certify claims of CO2 sequestration
Conclusions
• CO2-EOR has the potential to grow substantially under climate policies, using anthropogenic CO2
• CO2-EOR can meaningfully reduce oil imports• It provides a viable pathway for CO2
sequestration, potentially at a lower cost and faster timeframes
• Lower risk and disturbance than drilling in offshore or protected areas
• Regulatory gaps need to be addressed, and adequate institutional capacity ensured for wider deployment
References• Energy Information Administration, Energy Market and Economic
Impacts of H.R. 2454 http://www.eia.doe.gov/oiaf/servicerpt/hr2454/index.html
• Natural Resources Defense Council, Clean Energy Bargain http://www.nrdc.org/globalWarming/cap2.0/bargain.asp
• Advanced Resources International, “U.S. Oil Production Potential from Accelerated Deployment of Carbon Capture and Storage” http://www.adv-res.com/pdf/v4ARI%20CCS-CO2-EOR%20whitepaper%20FINAL%204-2-10.pdf
Contact
George Peridas, Ph.D.
Natural Resources Defense Council
111 Sutter St. 20th FloorSan Francisco, CA 94104
