The flood of applications for permits to build long-term carbon storage projects could add an enormous amount of storage capacity over the next decade if everything goes as planned.
There has been a 500% rise in applications since 2021 for Class VI disposal well permits, which are required in the US for carbon sequestration, according to a report from Enverus.
By mid-2026, those plans could lead to projects doubling the US injection rate to 40 million tons per annum of CO2, according to the energy data and consulting firm.
Rapid growth is also in the pipeline in the United Kingdom, where Westwood Global Energy Group predicts that, by “2030, there is potential for up to seven carbon storage sites with capacity for over 45 million tons per annum” of storage, which is significantly higher than past predictions.
But the report added a big if: These predictions depend on the timely delivery of government funding, regulatory approvals, and a supply of captured carbon dioxide. It said that “even minor delays will mean the UK misses its 2030 targets.”
“While the forecast carries an optimistic outlook, … delays and project under-delivery are not uncommon,” said Stuart Leitch, New Energies Research Manager for Westwood.
All those risks also apply in the US, but permitting is generating more comment than the petroleum engineering challenges of finding secure storage sites or capturing carbon dioxide from industrial waste streams.
A surge in permit requests have flooded the Environmental Protection Agency (EPA), rising from about four a year in 2020 to that many in an average month now, said Evan MacDonald, a senior geology associate at Enverus Intelligence Research.
Over the past few years, regulators have had to figure out how to evaluate whether storage proposals are likely to be able to meet the test of time, and MacDonald said they have been making progress on staffing up to handle the paperwork.
One hopeful indicator is the average time for the first stage of the process in the US—where they decide if the supporting information is complete—has gone from 8 months in 2020 to under 2 months now, he said.
On the other side, delays because of public opposition led to the cancellation of a proposed CO2 pipeline linking emitters in the Midwest to storage. “That is a bit of a challenge,” he said, but another proposed pipeline might “pick up some of the slack.”
Storage permitting and evaluation is prominent on the agenda of the annual CO2 Conference that is scheduled for Dec. 4–7 in Midland. Public opposition has been an issue, but there has been progress as well.
“What is seen in the news” is public opposition to storage and transport projects in the Midwest, said Steve Melzer, a consultant who is the CO2 Conference director. There has been some strong opposition to projects aimed at capturing and storing emissions from agricultural plants making ethanol and ammonia.
But there are also two storage projects going forward in North Dakota. A big difference there is that North Dakota is the first state in the country where the EPA has allowed state regulators to conduct the Class VI permit reviews.
On the growing list of states wanting to get that authority—known as primacy—is the state with the most proposed storage projects: Louisiana.
“The timeline has stretched and stretched and stretched for primacy and permit approvals,” Melzer said.
In Louisiana, Steve Lee, director of the Injection and Mining Division at the Louisiana Department of Natural Resources, has been working with the EPA for 3 years on primacy, while also trying to keep up with the many groups putting together storage deals.
In West Texas, projects also are moving ahead with efforts to get a permit in time to stick to their development schedule.
“We’ve projects charging ahead, thinking they can get” permits that will allow them to build in time to fulfill CO2 storage commitments, Melzer said.
The company with the most Class VI permit applications on the Enverus list is California Resources Corp., with 31 applications pending in its namesake state, twice the number for ExxonMobil, which is next on the list.
The California company is a large natural gas producer that has shifted its focus to redeveloping its old fields in Northern and Southern California for carbon storage.
Its most advanced project is in Elk Hills, which is named after a massive old oil and gas field where California Resources is one of the biggest gas producers.
While its location in Kern River country puts it near large heavy oil operators who need to reduce their carbon emissions, its website plays up its “clean energy park.” The tenants include companies using biomass to make renewable methane and gasoline that need storage to eliminate the carbon emissions associated with that production.
According to the Enverus study, development is more likely near companies with carbon emissions that can be captured economically and where sufficient pipeline capacity and subsurface storage capacity exists.
A big difference between Oklahoma and California is the rock. The geology in Louisiana is the “gold standard” for deep saline storage, with deep, depleted sandstone reservoirs with good seals. Those looking for storage in California have to deal with far more complex geology in this mountainous, tectonically active region, MacDonald said.
The Enverus report, which was compiled by a unit based in Alberta, did not report on storage projects in Canada, where the early-stage work does not generate the data the company extracts from Stage VI permit applications.
The government there, which holds the subsurface rights, has awarded 25 blocks to companies that are quietly evaluating whether they could be used for storage.
Canada has the geological and technical knowhow for storage development, as well as government pressure to reduce emissions. MacDonald pointed out that one of the pioneering storage sites, ShellQuest, is located near Edmonton.
The Canadian project most likely to be built is backed by a group of ultraheavy oil producers called the Pathways Alliance, which need to reduce its carbon footprint.
“They are anticipating a FID [final investment decision] by mid-2024. They are tying up loose ends now,” including deals with Indigenous landowners, MacDonald said.
