US prepares for overseas stockpiling by setting the rules of the game

US prepares for overseas stockpiling by setting the rules of the game

Emily Becquerel, an energy scientist at UH

We’re still in the early days, but using offshore storage wells and basins to store carbon captured from emissions and atmosphere is generating momentum.

Decarbonization techniques are becoming more economically viable, and the government has stepped through legislation to speed them up. The latest provisions in the Inflation Reduction Act are a good example. Carbon sequestration projects are getting a major boost from the Biden administration. They are, for example, the biggest winners in the $369 billion climate bill recently passed by Congress.

Next question: Where will all this captured carbon be stored?

Onshore (underground) geological storage is the obvious first stop. It has been used in the oil industry for years and is an integral part of the business for companies like Occidental Petroleum
, which uses carbon dioxide injection as a means to increase crude oil extraction. This practice is often called CO2 Enhanced Oil Recovery, or CO2 EOR.

The geological formations and depleted reservoirs in offshore waters such as the Gulf of Mexico also hold tremendous promise as future storage sites. The same porous geology of the outer continental shelf of the United States that made it such a great place to explore for oil and gas also makes it highly suitable for storing carbon.

Offshore storage also provides the ability to reuse extensive offshore infrastructure. More importantly, it also allows companies to be able to set up storage next to major emissions centers, such as refineries and industry, without having to worry about transferring carbon back to onshore facilities.

Government and industry have begun to take steps to take advantage of offshore storage sites.

Successfully storing carbon offshore means doing it safely. This means a set of regulations with the rules of the game for all players. It ensures that all operators are consistently applying the same safety practices that can be effectively monitored.

Drafting the initial set of safety regulations is the task of the US Department of the Interior’s Office of Energy Administration (BOEM) and Bureau of Safety and Environmental Enforcement (BSEE). They have a deadline in mid-November to do so, according to the Biden Administration’s Infrastructure and Jobs Investments Administration Act of 2021. It has given the Secretary of the Interior the authority to award leases for marine carbon storage in US federal waters.

The end of the game for the new rules is clear.

These external regulations need to make carbon storage safe for the public, which will provide confidence in developing the sector further. To do this, there must be parameters to ensure that storage sites are chosen carefully and that adequate monitoring is carried out to ensure that the carbon remains safely sequestered.

Existing rules for carbon storage on land, which are overseen by the US Environmental Protection Agency, or the US Environmental Protection Agency, have worked well and could provide some guidance. Its rules focus on ensuring the protection of underground drinking water sources. However, many elements of these regulations have beneficial overlap.

Like those related to offshore exploration and production, it is expected that the new regulations will be designed around best practices. The external regulatory agencies, BOEM and BSEE, have already proposed a list of these management practices for offshore carbon sequestration.

The menu – and practices – are similar to what energy companies already do for offshore oil and gas operations. When prospecting for hydrocarbons, companies spend millions to make sure they understand the site’s geology and characteristics. They do this by collecting and analyzing comprehensive geological data to determine with great accuracy the potential of a geological formation thousands of feet below the surface.

These same technologies are well suited to carbon storage offshore.

โ€œIt applies to slightly different conditions, but you still need to understand the areal and vertical structure of these reservoirs and how the sealing mechanisms โ€” layers of rock above and below, seals, etc. โ€” can effectively insulate fluids for centuries,โ€ said Ram Sitharam, a former CEO of Exxon who He is now working on affordable carbon capture and storage solutions: โ€œYou have to be able to predict where the carbon dioxide is going and be confident that there are no pathways to allow it to be released to the surface.โ€

It also means that the activities that regulations are expected to make mandatory – identifying risks through a risk management plan, monitoring these risks and reporting their progress – are already being practiced by the industry in drilling and production.

There are of course additional financial issues to be addressed, such as how to handle any liability issues that arise in the event of a storage malfunction, and how to shut down sites when necessary.

Those who remember the BP Deepwater Horizon incident fear a great uncertainty: the safety risks of offshore storage. There are many reasons why marine carbon storage is much less risky than an offshore oil rig or subsea drilling operation. The most important reason is that even in the worst-case scenario, a carbon dioxide spill is not as toxic or hazardous to the environment as the large oil spill.

โ€œThere are no combustibles to deal with,โ€ Sitharam said. “The explosion risks are much lower than dealing with hydrocarbons.”

But it still leaves the question of human health: while CO2 Naturally present in the air and harmless to health at low concentrations, it is carbon dioxide2 A pole could be enough to kill a person in direct contact. For this reason, the British government has raised concerns that carbon storage has the potential to create a significant accident risk, given the devastating spill.

For this very reason, many experts are of the opinion that outdoor storage is best for storage near population centers. At the same time, these safety concerns are why it’s good news that most companies looking at offshore carbon storage bring decades of experience.

Several of the largest energy companies operating in the Gulf of Mexico have already partnered to develop the Northern Lights Project, a marine carbon storage project in the North Sea and off the coast of Norway. The project is currently scheduled to become operational in 2026. The participating companies – BP, Eni, Equinor, Shell and Total – are players in the Gulf of Mexico as well and are said to be looking for offshore warehousing opportunities.

Coming up with enough bases to protect us while still encouraging much-needed service in the name of climate protection is a heavy burden on regulators. But these new regulations cannot come soon enough.

Emily Becquerel A veteran energy reporter, he has over 12 years of experience covering everything from oil fields to industrial water policy to the latest Mexican climate change laws. Emily has reported on energy issues from across the United States, Mexico and the United Kingdom. Prior to journalism, Emily worked as a political analyst for the US Government Accountability Office and as an auditor for Aid International Care.

UH Energy is the University of Houston’s center for energy education, research, and technology incubation, shaping the future of energy and shaping new business approaches to the energy industry.

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