Elon And Exxon Agree: Carbon Capture Is Set To Explode in 2021
There is little question that carbon capture, storage, and utilization is destined to become one of America’s big growth industries in the years to come.
There is little question that carbon capture, storage, and utilization (CCSU) is destined to become one of America’s big growth industries in the years to come. Tesla and SpaceX founder and CEO Elon Musk— whose real-time net worth according to Forbes would rank him just behind Jeff Bezos as the world’s 2nd-wealthiest man—is so enthused about this looming technological bonanza that he recently committed to putting up $100 million of his personal fortune as an award to the person or company who comes up with the most promising new approach to making CCSU a scalable and workable approach to reducing atmospheric carbon dioxide.
“Am donating $100M towards a prize for best carbon capture technology,” Musk tweeted to his 42.7 million followers on 21 January, following with a second tweet promising to provide details “next week.” The following week came and went without said details being released, but Musk’s history would indicate he wasn’t just blowing smoke and that details will be coming soon enough.
The Potential for CCSU in Texas
A week later, Rice University’s Baker Institute for Public Policy, in a project supported by the Cynthia and George Mitchell Foundation, released a new report on 28 January detailing the potential for the state of Texas to play a leading role in the development of this economic sector. Authored by Kenneth Medlock, senior director of the Center for Energy Studies at the Baker Institute, and Keily Miller, research manager at the Center for Energy Studies, the report outlines the development of a CCUS value chain and discusses various coordination problems and legal, regulatory, and commercial encumbrances that can hinder its future development in the state.
“As consumers and investors increasingly reveal preferences for lower CO2 emissions, market agents are shifting their investment and marketing strategies,” the authors wrote. “This provides an opportunity for regulators and policymakers to reduce uncertainties that can impede investment and explore fiscal measures that provide value to legacy industries and create pathways for growth in new industries.”
Medlock and Miller also note that a robust research and development portfolio, supported by government initiatives, will be a key to rapid progress in this arena: “Given the importance of hydrocarbons to the Texas economy, a robust R&D portfolio that focuses on efficiency improvements in existing CCUS technologies, new combustion processes, expanded uses of hydrogen produced from hydrocarbon feedstocks, new carbon-based materials and new uses for CO2 in industrial processes and power generation can contribute greatly to the health of Texas’ economic and environmental future.”
With its wealth of depleted oil and gas fields around the state, especially in West Texas and the Gulf Coast, Texas stands to benefit from this new growth industry in the decades to come. As Medlock and Miller point out, those benefits can be maximized by smart public policy measures.
Big Oil Has a Big Role to Play
Given the huge potential for those depleted conventional oil and gas reservoirs to provide enormous volumes of core space for carbon capture and storage (CCS) operations, energy companies doing business in Texas have been engaged in experimentation and operations related to this area for decades now. Two big companies headquartered in the state—ExxonMobil and Oxy—have recently begun expanding their already considerable efforts in this arena.
In coordination with its quarterly results on 1 February, ExxonMobil announced a significant new business plan that will expand its global low-carbon technology portfolio. Exxon is a company that has been involved in CCS for more than 30 years, to such an extent that it is able to boast of being responsible for capturing and storing 40% of all CO2 that’s ever been captured and stored.
Exxon CEO Darren Woods said that “Given the importance of hydrocarbons to the Texas economy, a robust R&D portfolio that focuses on efficiency improvements in existing CCUS technologies, new combustion processes, expanded uses of hydrogen produced from hydrocarbon feedstocks, new carbon-based materials and new uses for CO2 in industrial processes and power generation can contribute greatly to the health of Texas’ economic and environmental future.”
In addition to exploring potential projects along the Gulf Coasts of Texas and other states, involving geologic formations both onshore and offshore, Exxon said it also plans to evaluate opportunities in Wyoming, the Netherlands, Belgium, Scotland, Singapore, and Qatar. Thus, the company plans to address a global issue with a truly global business enterprise.
Oxy has also been involved in CCS for decades, and has long operated very large projects in the Permian Basin of West Texas. “We believe we have a moral imperative, (and) Occidental is committed … ,” Vicki Hollub, Oxy CEO, told a conference in January, discussing her company’s plan to achieve net-zero carbon profile by 2050, through efficiencies and an expanded CCSU program. “We cannot achieve the Paris accords without this.”