DOE LOOKING TO SHIFT REGIONAL PARTNERSHIPS MORE TOWARD EOR

Tamar Hallerman
GHG Monitor
07/06/12

The Department of Energy is looking to more formally shift the focus of its regional carbon sequestration partnerships away from the geologic sequestration of CO2 in saline aquifers and toward enhanced oil recovery, a move that, if implemented, could continue a trend that has increasingly characterized the partnerships and DOE’s demonstration program in recent years. In a recent speech in front of the National Coal Council, DOE Assistant Secretary for Fossil Energy Chuck McConnell said that while saline aquifer work will not cease within the partnerships, about 80 percent of work will eventually focus on EOR or CO2 utilization. “Up until now, the partnerships have spent an enormous amount of time working on saline aquifer CO2 sequestration. Although it was all good work for a good purpose and generated good best practices, I just spent the last two months beating my brains out with the [White House] Office of Management and Budget and have gotten to the point now where we are redirecting funds in the partnerships and we’re going to go after EOR geologies,” McConnell said.

McConnell, who has spent his year at the helm of DOE’s Office of Fossil Energy as an ardent advocate of EOR and carbon capture, utilization and storage, said that areas of the country where oil deposits exist match up “quite well” with where DOE’s regional partnerships are located. “We are going to begin to do more work in the geologies that are oil bearing and less work in the areas of saline aquifers that have been the majority of the focus for the past several years,” McConnell told reporters last month. “It is going to have the same result: CO2 will get sequestered. It won’t change anything—this is not the partnerships going after oil production. It’s the partnerships going after different geologies that will give the safe and permanent long-term storage for CO2.” McConnell said that current Phase III work will not stop. Instead, DOE Office of Fossil Energy spokeswoman Jenny Hakun said some of the partnerships are looking for ways to fold EOR into their current work. “This is something that’s evolving as we go on, so there are no definite plans as of yet,” Hakun said.

Partnerships Have Shifted Toward EOR

If a more formal shift towards EOR occurs within the regional partnerships, it will continue a trend that has caused many of DOE’s carbon capture and storage-related programs to drift away from CO2 storage in saline aquifers towards EOR and CCUS following the failure of climate legislation in Congress in 2010. Within the Office of Fossil Energy’s large-scale demonstration program, nearly all of the CCS projects that have moved forward the most rapidly in recent years have included an EOR or CCUS component. With the halting of American Electric Power’s Mountaineer project last summer, only two projects remain in DOE’s demonstration project portfolio that are not looking to do some sort of EOR component—FutureGen 2.0 and Archer Daniels Midland’s ethanol plant capture project in Decatur, Ill.

Established in 2003, the regional partnerships were initially created as a keystone of national efforts to understand the storage of CO2 into saline aquifers as a way to mitigate climate change. Seven regional coalitions of industry, national labs and academic groups in the U.S. and Canada were awarded DOE cooperative agreements to study the geologies of their regions over several phases. The first phase, which ran through 2005, sponsored initial characterization work for regional geologies. The second, a validation phase from 2005 to 2011, helped evaluate promising storage opportunities via small-scale field tests. The third and current phase, which began for some as early as 2008, called for the large-scale injection of at least 1 million metric tons of CO2 into saline aquifers for most. However, oil reservoirs played a role throughout all phases and had a growing role as it became clear that the economic drivers associated with EOR would help sweeten the deal for CCS, with several partnerships adopting CO2 injection into depleted oil reservoirs as part of their game plans.

Within the regional partnerships, many interviewed by GHG Monitor have indicated a marked shift towards EOR as well, although opinions differ on whether it was a top-down move from DOE or a natural progression from within the partnerships themselves. “I think the successes that the partnerships have had in making the business case for carbon capture and storage seem to point to CO2-EOR as the early opportunity for CCS adoption. We see that over and over again in every region,” said Elizabeth Burton of the West Coast Regional Carbon Sequestration Partnership and Lawrence Berkeley National Lab. Midwest Carbon Sequestration Regional Partnership spokesman T.R. Massey, also of Battelle, acknowledged a shift, saying, though, that the changes have been “organic,” not a top-down decision from DOE. “This change of inserting a ‘U’ into CCS is kind of a progression,” he said. “As you do research into CO2 injections, you look at every aspect of [your geology]. If you can do deep saline injections in concert with some enhanced oil recovery, then great.” The Midwest Carbon Sequestration Regional Partnership began conducting validation work at a site in northern Michigan during Phase II that is an active host to EOR operations.

Brian McPherson, an associate professor of engineering at the University of Utah who also works with the Southwest Regional Carbon Sequestration Project, said in an interview that the shift in his own project recently from saline storage to EOR is indicative of some of the overall changes that seem to be occurring across many of the partnerships. “Six months ago, we were slated to inject into a deep saline aquifer, and in two months from now we will be a completely EOR-based project for Phase III,” he said. “We moved from a deep saline site in central Utah to an enhanced oil recovery site in northern Texas… it’s been a natural progression, but on the other hand when we discussed it with DOE they were extremely encouraging.”

Oil-Bearing Regions See ‘Natural’ Shift Toward EOR

Others interviewed from more traditional oil-bearing regions said that their partnerships have always been more aware of opportunities for EOR. John Harju of the Plains CO2 Reduction Partnership (PCOR) who also works at the University of North Dakota’s Energy and Environmental Research Center, told GHG Monitor that EOR was an easy fit for the partnership’s operations given the region’s history of oil and gas development. PCOR monitored injection into an EOR site in its Phase II work and plans to do so in its Phase III monitoring project at an EOR site near Bell, Creek Mont. “I think the beauty of the partnerships has always been that there’s been a regional emphasis. As such, in our region there’s always been an EOR opportunity. So this isn’t an entirely new situation for us,” he said. “I would say that it’s neither a top-down nor an organic growth, but rather just a natural outcome in terms of needing to have market signals to have these projects move forward in any way, shape or form. Given the lack of any firm policy signal on CCS, it almost necessitates that some economic return get into the project mix in order to have projects actually move forward.”

While the Big Sky Carbon Sequestration Project in the Pacific Northwest plans on injecting into the Kevin Dome formation, which is not an EOR site, one of its industry partners, Vecta Oil & Gas, is interested in reproducing injection work in order to do its own EOR testing in the future, according to Kathryn Watson, outreach and communication’s director for the partnership. “This area has been very active in the oil and gas industry since the 1920s, and for us [EOR] has always been very much a consideration,” Watson said. “We have been and will probably continue to be very well aligned with that. That has always been the goal of our applied research element.”

However, one of the furthest-along regional partnerships, the Midwest Geological Sequestration Consortium, has moved ahead with injection operations into the Mt. Simon formation in Illinois without an EOR component. Calls to the Consortium were not returned.