ExxonMobil, Texas signs deal for nation’s largest offshore CO2 storage site

Diving certificate:

• ExxonMobil last week signed a contract with the state of Texas for the nation’s largest offshore carbon capture and storage facility The company announced this on Thursday. The deal gives the energy giant access to more than 270,000 acres of flooded land to sequester carbon dioxide, Texas. The General Land Office announced this in a press release on the same day.
• Proceeds from the lease will go to the Texas Permanent School Fund, which the GLO estimates will “provide millions” to the Texas school system. The exact financial details of the deal were not disclosed.
• The deal comes as follows Transition scenario projections from BloombergNEF found that for the U.S. to achieve a net-zero emissions scenario, all natural gas or coal emissions must be offset by carbon capture by 2050.

Insight into the dive:

Exxon currently operates the largest carbon dioxide pipeline network in the country, spanning 1,500 miles and three states bordering the Gulf of Mexico the company’s website. Exxon said in the Oct. 10 press release that it views the deal as complementary to onshore carbon capture capacity it is developing and that “offshore acreage provides much-needed storage space.” [carbon dioxide] Emissions.”

The energy giant said it believes the Gulf region has “tremendous potential” in terms of offshore carbon storage and will “play a key role in achieving society’s net zero targets”. Dan Ammann, president of Low Carbon Solutions at Exxon, said in the press release that the deal represents a sign of the company’s commitment to carbon capture and sequestration.

“With our growing number of customers ready to deploy CCS, we will drive significant emissions reductions along the Gulf Coast through a comprehensive solution that includes capture, transportation and storage,” Ammann said.

The offshore storage space leased by Exxon is located off the coast of Texas’ Jefferson, Chambers and Galveston counties, and the GLO said the deal is the “largest carbon capture and sequestration transportation and storage contract in the state’s history.” The lease gives Exxon the right to sequester carbon dioxide “approximately one to two miles below the surface” of the Gulf, GLO said in the release.

The GLO oversees 13 million acres of federal land in Texas, making it the largest land and mineral owner in the state, the release said. Dawn Buckingham, Texas Land Commission, said the partnership will allow Exxon to use the land for “innovative solutions that can help ensure future energy production.”

“Energy independence is critical to ensuring our state and country remain economic leaders around the world,” Buckingham said, adding that she is “thrilled that revenue from this lease will benefit the project.” [the] State along with our Texas school children.”

According to its website, Exxon’s carbon dioxide transport pipeline currently runs through Texas, Louisiana and Mississippi near or near sites of enhanced oil extraction, industry and carbon storage. The company’s carbon storage sites are in Texas and Louisiana, and Class VI injection well permits are in the queue, according to a Map of its carbon capture, transport and storage operations.

The deal follows an agreement on carbon capture Exxon signed a contract with agribusiness manufacturer CF Industries in July to transport and store up to 500,000 tons of carbon dioxide emissions annually, which will be captured at a CF complex in Mississippi. This was Exxon’s fourth industrial carbon capture customer, and the energy giant has committed to storing 5.5 million tons of carbon dioxide for its customers, it said in a statement at the time.

The latest energy outlook from BloombergNEF found that the U.S. energy transition currently has about a 67% chance of leading to a global temperature increase of 2.6 degrees Celsius by 2050 – far from net-zero climate goals. The same study found that the country is on track to reduce its emissions by just 22% by 2050, compared to the 50% needed to meet its nationally determined contribution to the Paris Agreement.

Exxon released its own global energy outlook on Friday, which found that global energy consumption will increase by 15% by 2050. The data estimates that greater energy efficiency, as well as more renewable energy and lower-emission technologies, will reduce global emissions by 25% by mid-century. The report also found that additional policy support, including greater transparency, will be needed to support the development of lower-carbon technologies.

Chris Birdsall, Exxon’s energy and economics director, said in a blog post on Friday that the forecasts are objective and represent the company’s “best view of what the global landscape will look like in a few decades, versus what we might hope for.”

The report projects that all current energy types will remain in the energy mix by 2050, with coal declining the most and renewables expected to grow the fastest. Exxon’s outlook also notes that oil production is declining by about 15% each year, reducing oil reserves from about 100 million barrels per day to 30 million barrels per day.

The report concludes that “global oil and natural gas reserves are increasing at current rates.” [may] “Without further investment they will virtually disappear,” although “global demand for oil and gas remains strong.”