13-03-06
Wanted: carbon dioxide. Large quantity needed to help superpower reverse
declining oil output and halt rising emissions of heat-trapping gases.
The Department of Energy and some environmentalists hope that in coming decades
oil companies will expand programs that boost the output of aging oilfields by
injecting the gas most scientists call the main culprit in global warming.
Since the early 1980s, almost as long as US oil output has been waning,
companies have been pumping small amounts of CO2 into old Texas oilfields to
force to the surface remaining crude that is trapped between complicated rock
formations. Depending on the price of oil and CO2, the United States could
quadruple its oil reserves to 89 bn barrels, by pumping more of the gas into
oilfields, the Department of Energy said in a report earlier.
But to get to that prize the United States would need 350 tcf, more than 10
times the amount in natural underground deposits of the gas. Currently 80 % of
CO2 pumped into US oilfieldscomes from those natural deposits, such as the Bravo
dome in New Mexico, of which Occidental owns a majority share.
Taking CO2 from natural sources does nothing to cut emissions of the gas from
coal-and-natural-gas-burning power plants, the source of 40 % of CO2 emissions.
With incentives, CO2 could be captured from power plants helping companies to
sell credits in future cap and trade emissions markets.
Equipment can capture CO2 at fossil fuel-burning power plants, but the
technology, in its infancy, is expensive. Utilities, such as American Electric
Power and Cinergy, are building clean-burning coal plants to which the equipment
can be added more cheaply than conventional plants. But until the CO2-capturing
technology becomes cheaper, or is required by law, they have no plans to add it
to their plants.
US utilities can't earn credits for reducing emissions as their European
counterparts can in an emissions trading scheme set up under the Kyoto Protocol.
President George W. Bush pulled the United States out of the pact. But seven
states in the Northeast are trying to create a market in which power plants that
cut emissions can sell credits to companies that chose not to cut emissions.
Other states, including California, hope to follow their lead.
And incentives for oil companies to bury more CO2 could be forthcoming. Under
last year's Energy Act, the Bureau of Land Management and the Minerals
Management Service are considering whether to extend incentives to oil companies
that pump CO2 into offshore and on land oilfields.
Costs could be a concern. The price of CO2 itself, currently about $ 1 per
thousand cf, would have to fall to about 75 to 80 cents. At current costs,
purchasing CO2 can cost oil companies about $ 6 for every barrel produced with
the technology.
Beyond the expense, some environmentalists are concerned about the permanence of
CO2 burial especially in oilfields which by definition have been drilled
repeatedly over the years. They also worry the gas could leak after the
fieldsare fully drained of oil and forgotten about.
Source: AP