The Carbon Corner - Issue #13

We are back at it again with another edition of The Carbon Corner, where we are discussing all things CCS!

This week we are bringing you big news of a Blue Hydrogen facility planned to be right here close to our home, along with other updates on partnerships and ventures!

Happy Friday! We hope you enjoy it!

Verde CO2 on the Rise

In 2019, Charles Fridge, former CEO of Throne Petroleum LLC, founded Verde CO2. The company focused on the energy transition, specifically intending to solve emission issues by partaking in carbon capture and long-term sequestration. The aim was to determine the biggest CO2 emitters and successfully identify storage capacity, reservoir quality, and containment plans.

Since its inception, project development has primarily focused on the Gulf Coast region due to its richness in Miocene and Frio-aged saline aquifers with multiple zone lobes. According to Fridge, this aquifer lends itself to a “rinse and repeat” method. After a year or two of successful monitoring in the target zone, it is assumed that the CO2 will remain safely there and the company can repeat in uphole targets.

The Baton Rouge Chemical Corridor in Louisiana is the company’s most significant project. Fridge has mentioned plans to expand in that region, the San Joaquin and Sacramento basins in California, and the San Juan basin of New Mexico.

A £360 Project to Begin in Cheshire

As we see week after week, carbon capture and sequestration is a global initiative.

Essar Oil UK has announced plans to construct a new £360 million CO2 capture plant in Cheshire, UK, at the Stanlow facility. These efforts will consist of carbon capture at one of Europe’s largest full-residue catalytic cracking units, followed by sequestration into gas fields under the sea in Liverpool Bay.

The project is set to complete in 2027 and is estimated to eliminate 0.81 million tons of CO2 annually, equivalent to 40% of all Stanlow emissions.

Essar Oil CEO Deepak Maheshwari spoke on the matter, saying, “Our ambition is to become a leading low-carbon refinery. This is a massive undertaking, but it is a journey we are fully committed to. Not only is it the right environmental thing to do, it will future-proof the critical Stanlow refinery for the long term, protecting jobs and industry while also placing Stanlow at the very center of the UK’s energy transition.”

Though the project is small relative to some US-based sequestration sites, it is still significant progress for the UK’s journey toward carbon neutrality.

CRC Positions TerraVault Project for Blue Hydrogen

A Carbon Dioxide Management Agreement (CDMA) between Carbon TerraVault JV Holdco, LLC and Lone Cypress Energy Services, LLC was announced earlier this week by California Resources Corporation. The first project of this partnership is “The Lone Cypress Hydrogen Project,” which will attempt to be California’s first blue hydrogen facility. The goal is to expand to producing 60 tonnes of blue hydrogen daily and performing sequestration at a rate of 200,000 MT annually.

The project’s final investment decision (FID) is set for late 2023, with hopes of operations starting in 2025. Currently, Lone Cypress will have access to 50 surface acres at the Elk Hills Field with the option of expanding to 100 total acres.

“Partnering with CTV JV represents an incredible opportunity to continue the growth of our hydrogen and carbon capture businesses. California is at the forefront of the global energy transition, and through this partnership, we intend to be a leader in its low-carbon fuels market,” said Greg Brooks, President, and Founder of Lone Cypress Energy Services.

Blue hydrogen is an increasingly relevant energy transition investment theme in late 2022. This may be driven by enhanced fuel subsidies and the need to rationalize CCS projects as connected to their production.

Cleveland-Cliffs Applies for Funding of Burns Harbor FEED Study

The readers may remember our last coverage of the U.S. Department of Energy’s (DOE) funding for carbon capture-related ventures.

One of the recipients, Cleveland-Cliffs Inc., has announced the completion of their first research phase and has applied for additional funding to cover 50% of the next stage.

Phase two includes a FEED study at Burns Harbor, an iron and steel facility in Northwest Indiana. The aim is to capture up to 2.8 million tonnes of carbon annually with a net carbon capture efficiency of at least 95%. The study would be completed over 24 months.

Cleveland-Cliffs has a good chance of receiving the funding, as they are the only American steel producer participating in the DOE Better Climate Challenge initiative and are the most significant steel player in the DOE’s Better Plants program.

Largest Blue Ammonia Facility Breaks Ground in Texas

This week, OCI N.V. announced the construction of the largest blue ammonia facility in Beaumont, Texas. Blue Ammonia is a chemical compound of nitrogen and “blue” hydrogen, meaning that any carbon dioxide released during hydrogen production is captured and stored.

This project is expected to begin production in 2025 and is on track, with the recent receipt of an air permit from the Texas Commission on Environmental Quality on the first of December.

When speaking on this endeavor, Ahmed El-Hoshy, CEO of OCI N.V. commented, “The potential for clean ammonia to solve many of our global problems has become increasingly clear. It is not only an essential fertilizer that ensures food security for over 4 billion people; low-carbon ammonia is a clean fuel that provides an ideal solution available today for hard-to-abate sectors such as power and shipping. This world-scale facility will be a significant part of that, resulting in a very significant reduction in carbon emissions equivalent to taking almost half a million cars off the road permanently. The potential here is great and I’m delighted that breaking ground today signifies we’re on track to deliver on that.”

Texas continues to be a breeding ground for chemicals-based CCS projects, which should only accelerate as offshore sequestration projects move forward to FID.

That’s a wrap for this week’s edition of the Carbon Corner!

Schaper Energy Consulting is a professional engineering firm offering carbon strategy services to CCS site developers. Check out some examples of our projects here: https://schaperintl.com/carbon-strategies/

If you have questions or comments, please get in touch with us at info@schaperintl.com.

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