Abby L. Harvey
GHG Monitor
10/17/2014
AUSTIN, Texas—The logistics of using carbon dioxide for enhanced oil recovery are often misunderstood, which can cause trouble for those involved in the practice when it comes to policy development, Greg Schnacke, Executive Director of Governmental Affairs for Denbury Resources, Inc said during the International Conference on Greenhouse Gas Technologies, held here last week. “In the U.S., essentially it’s federal law that CO2 now is a federally regulated pollutant under the Clean Air Act and that provides a challenge to all of us who beneficially use CO2 for commercial purposes,” Schnacke said.
One regulatory issue surrounding EOR stems from the practice of re-using the CO2, Schnacke said. “What many people fail to understand about CO2 [EOR] is that it evolves over time from a predominantly purchase-and-injection operation to a predominantly recycled re-injection operation and so when we first started our discussions with policymakers, [we explained that] yes we take a lot of CO2 and we inject it into the ground, but we also bring it back up and re-use it, and over time … at the end of the life of the field, more of that CO2 is coming from CO2 that we’ve already brought in and a lot of it of course stays there.”
This distinction comes into to play in issues of permitting. For example, the Environmental Protection Agency has developed a new class of well permit for the injection of CO2, however, that permit does not apply to EOR operations. “They have a separate well class … Class VI, but it is really designed for dedicated CO2 injection for underground permanent storage. They have indicated in their rules that CO2-EOR, as long as it’s producing oil, is not a part of that regulatory structure and we’ve been working with them … on ways that they will implement that in terms of how they will treat the oil field in the future,” Schnacke said.
EPA’s Proposed New Source Standards Could Hinder EOR
EOR’s place in the EPA’s proposed new source performance standards for new-build coal-fired power plants is also problematic, Schnacke said. The proposed standards would essentially mandate the use of carbon capture and storage technology on all new-build coal-fired power plants. “Our assessment of [the proposal] is that it essentially treats EOR separately and essentially converts us into a waste disposal operation,” he said. “That’s not something that we are … authorized to do under our leases or under our unit agreements. We are also under obligations under conservation law in the United States to conserve natural resources with the prevention of waste of the resource, meaning efficient production of oil and under those confines this particular type of proposal simply doesn’t work in the oil field, so we’ve been counseling EPA and others to consider how we do our operations and to encourage us rather than discourage us from taking industrial carbon for enhance oil recovery.”
