In my last article, I mentioned how carbon dioxide (CO2) injection technology holds the promise of tripling oil production from domestic enhanced recovery operations.
At least, that’s what Michael Ming, General Manager of General Electric (GE), claims.
The company is working with Norway’s privately owned Sargas SA to capture CO2 emissions from power plants. The carbon dioxide will later be injected into oil fields.
Now, it’s impressive enough that the company has taken notice of the trend’s emerging importance – since many others in the industry are ignoring its potential.
That being said, however, the CO2 business for GE is still relatively small.
So let’s take a look at some players that stand to benefit from the coming CO2 boom in oil production.
Denbury Resources Leading the Way
A big player in this up-and-coming sector is Denbury Resources (DNR).
Denbury owns the largest reserves of naturally occurring underground carbon dioxide used for oil recovery east of the Mississippi River.
And its primary focus is using CO2 to increase oil output from past-producing fields of stranded oil.
The company happens to be involved in America’s largest carbon capture project in partnership with Air Products & Chemicals (APD) and Valero Energy (VLO). The project received a $284-million investment from the U.S. Department of Energy because it cuts carbon emissions.
Air Products runs a hydrogen plant that captures 50 million cubic feet of carbon dioxide per day at Valero’s refinery in Port Arthur, Texas. The company then compresses the CO2 and puts it into a pipeline to Denbury.
Denbury then uses the captured CO2 for its EOR operations all across the Gulf Coast.
GE says the only thing holding back this corner of the energy industry right now is supply challenges. The cost of capturing carbon from power plants and industries must fall to make it worthwhile for other companies to adapt the technology.
So more projects like Denbury’s venture with Air Products are needed. But Denbury is benefiting, nonetheless.
Statoil and GE Team Up
CO2’s use in enhanced recovery operations isn’t the only possible use for the gas in the energy industry.
As mentioned briefly in my last article, carbon dioxide may one day replace water in fracking operations.
GE is leading the way here, along with Norwegian energy company, Statoil ASA (STO).
The two companies are working on a $10-billion research program that’s aimed at using captured CO2 instead of water in fracking.
The firms are studying how a chilled form of CO2, known as a “super-critical fluid” – neither solid nor liquid – could become the new energy industry standard.
CO2 has already been used for fracking on a small scale in the 1990s by Canadian FracMaster (before it filed for bankruptcy). At the time, the company proved that it could produce more oil and natural gas than using water. That’s because CO2 fracks occur at higher pressures than fracks using water.
Today, GE and Statoil plan to use their deeper pockets to find the perfect viscosity for the chilled CO2. By doing so, the carbon dioxide can carry proppant sand – a key factor in the fracking process.
They also need to figure out how to re-capture the carbon dioxide at the wellhead so that it can be re-used to frack additional wells.
Of course, using CO2 for fracking on a wide scale is probably a few years away.
But when the technology moves forward, it’ll be a game changer for the industry.
And “the chase” continues,