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Carbon Capture Usage: Government and Industry Lenses

This piece has been individually written as part of a series on Carbon Capture Technology discussions. The posts in this blog were prepared by Isabella Corpora in her personal capacity. The information, views expressed, and contents of this blog are solely the author’s and do not reflect the position or policies of any organization she is affiliated with. To learn more about mitigating GHG emissions from the oil and gas industry, join the Global Webinar on “Available Technologies that Contribute to Climate Mitigation in Upstream Oil and Gas Production”, scheduled on 06 July. Register here.

The Petra Nova project in Thompsons, Texas, USA.

Oil has been a predominant resource since the mid-1800s. Petroleum has allowed us to power our homes and industries, fly high into the skies, and transport goods and people. It has always been a dependable energy source.

Nowadays oil and gas are looked at differently, as they are primary contributors to climate change that is undermining our development gains, increasing disaster risks, and impacting livelihoods and public health. As the global community shifts towards renewable energy, many governments and private companies are considering a multitude of options to reduce greenhouse gas emissions from the oil and gas sector, including with carbon capture technology.

The Role of Carbon Capture in Government Policies

The best way to tackle emissions is to stop them at the source through mitigation policy, if not abate producing them altogether. Many countries have adopted carbon capture and storage (CCS) or carbon capture, utilization, and storage (CCUS) into their Nationally Determined Contributions under Article 6 of the Paris Agreement, pledging to reduce their emissions, and for some, a full commitment to net-zero emissions. Oil and gas-producing countries that currently have CCS incorporated into their NDCs include: Australia, Bahrain, China, Egypt, Iran, Iraq, Malawi, Mongolia, Norway, Saudi Arabia, South Africa, and the United Arab Emirates. CCS is still being implemented into national policies within the European Union, Canada, Japan, Mexico, South Africa, Singapore, Ukraine, the United Kingdom, and the United States.

There are two main uses of carbon capture technology: the first is to achieve emissions reductions for environmental protection purposes, allowing for the capturing of certain greenhouse gases from flue gas streams to prevent them from entering the atmosphere. The second and more controversial usage is for enhanced oil recovery, a process of injecting captured gases into oil wells to bring up the last bits of oil. You can read more about this here. It is believed that CCS and CCUS for enhanced oil recovery prolong the fossil fuel sector, thus perpetuating a continued dependence on oil and gas.

The Petra Nova project in the United States is an example of government sponsorship of carbon capture programs with the goal of enhanced oil recovery. Petra Nova is a CCS project that has operated along a coal power plant in southwest Texas funded by the US Department of Energy since 2010. Its post-combustion CCS technology captures 90% of the emissions produced and stores the carbon dioxide for transportation via pipelines. Traditionally, captured carbon can be processed into other products or stored below ground (for example in depleted oil reservoirs, saline aquifers, or mineral layers below the Earth’s surface). At Petra Nova specifically, the captured carbon is used in neighboring oil fields to increase production. As a predominant oil refiner and with the oil sector contributing to 8% of its GDP, it is understandable that CCS technology is an attractive method in helping the US maintain its oil market and, technically, its coal market. In the context of Petra Nova, CCS is mostly used for EOR, bringing into question the purpose of capturing the carbon and whether this process actually helps the environment.

The most notable federal assistance to CCS usage is through the 45Q tax credit, created to incentivize enhanced oil recovery efforts. 45Q sets a price on each ton of carbon sequestered, depending upon whether the captured carbon is used for enhanced oil recovery or put into storage. It also has new eligibility thresholds for acceptance into the tax credit, which are now between 25,000 - 100,000 tons captured compared to the previous 500,000 tons threshold. This new reduced threshold has expanded the amount of companies able to participate in the program, thus facilitating investments in emissions reductions nationally where the goal of the CCS is for storage. Most other CCS legislation in the US is enacted at state levels. Interestingly, this policy is heavily EOR-oriented, as opposed to other carbon capture policies that seemingly seek to achieve emissions reductions through CCS, such as the NDC. The updated NDC of the United States for 2021 includes CCS technology both in the "electricity" and "industry" sections, enabling the country to meet its 2030 goal of a 50-52% emissions reduction compared to 2005 levels. In this context, CCS is viewed as geared towards environmental protection more than energy production, but it is unclear to the extent this will be met. Again we can see an effort being made on a policy level but realistically these targets can and should be much higher to put the US in alignment with Paris Agreement goals.

There are though many countries using CCS technology to ambitiously and actively protect the environment, such as in Norway. In Norway’s NDC, they clearly state their goals for a 40% reduction of emissions by 2040 compared to 1990 levels.

"Economic measures like CO2- taxes and emission trading are central to Norwegian climate policy. Support for the development and adoption of low emissions technologies, including carbon capture and storage technologies and electric vehicles as well as policies for renewable energy are also important in Norwegian climate policy." (NDC 2020)

The technology used simultaneously with mitigation policies such as carbon taxes and emissions trading schemes will help set them on track to reduce their emissions outputs, importantly so since Norway is a dominant oil producer. To find out more about this, please watch our webinar on Available Technologies that Contribute to Climate Mitigation in Upstream Oil and Gas Production to learn about Norway’s CCS usage directly from a member of the government Petroleum Directorate.

Industry Experiences with CCS

Exxon has recently proposed acquiring $100 billion to implement a CCS plan by 2030 to capture 50 million metric tons of carbon dioxide by 2030 and 100 million by 2040. The captured carbon would be stored in saline aquifers with a storage capacity approaching 500 gigatons available space near the Gulf of Mexico. This is quite impressive and could help account for a fair share of global emissions reduction. Nonetheless, carbon storage in saline aquifers or depleted oil and gas reservoirs isn’t always the most secure- there can still be leakages of the gas back into the atmosphere. More permanent forms of storage can be done through chemical interactions in certain forms of rocks and minerals, and it would be interesting to see Exxon store their carbon in these areas, such as basalt aquifers (which, notably, have 8000+ gigatons of storage capacity). This would all be accomplished under Exxon’s new Low Carbon Solutions project that came out in 2021. Prior to Low Carbon Solutions, their carbon sequestration was being achieved at 9 million tons CO2 per year, so significant strides for accountability are being made. As of June 2021, Exxon also had two new climate activists appointed to its board and a potential third, meaning there’s a chance there will be pressure towards creating a net-zero emissions goal. You can read more about Exxon’s goals here.

However, much of Exxon’s CCS usage too is geared towards enhanced oil recovery. Though EOR simultaneously means emissions are being captured and therefore reduced, the main goal is for continued oil production rather than environmental protection and reduced emissions.

One of the most important aspects that does come from private-sector carbon capture development is the scope of research to be conducted. Exxon’s research and development coming from a heavily funded background could provide innovation and scalability of the technology for the rest of the world, providing a potentially lower-cost solution with a quick rollout. Their competition with other private companies also facilitates an environment where the best and cheapest technology can be developed, as opposed to the public sector that can have less funding. There is still much more research to be conducted in this field, notably to be shared with other oil and gas operators and even the public sector.


Without a doubt, governments and industry will need to account for their emissions. In this period of energy transition, carbon capture and storage technology provides one possible option for reducing emissions, especially in the short term as countries and industries make the energy shift. When used for enhanced oil recovery, it raises more questions whether the technology should be used to prolong a climate change-inducing energy source. It will be interesting to follow how CCS technologies evolve as global climate policies – and political pressures - also advance.

If you are interested in reading more about CCS technology from an environmental justice lens, and would like to read a recap on this webinar, please be on the lookout for my next blog.

05 July 2021.

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