Subtask 1.4 - Techno-Economic Assessment of Regional Carbon Utilization Scenarios and Attendant Monitoring Technology
The U.S. Department of Energy (DOE) Carbon Storage Program seeks to develop technologies to significantly improve the effectiveness of carbon capture and storage (CCS), reduce the cost of implementation, and support the readiness of widespread commercial deployment by 2035. To accomplish this goal, technical and economic barriers must be addressed and the results used to inform regulators and industry on the safety, permanence, and viability of carbon storage. To help overcome these barriers, the Energy & Environmental Research Center (EERC) conducted three activities: 1) investigate the regional techno-economic life cycle of CO2 enhanced oil recovery (EOR) in North Dakota, 2) assist DOE in determining the prospective CO2 storage resource of residual oil zones (ROZs), and 3) develop a seismic technique for monitoring geologic storage of CO2. These three activities address two strategic goals enumerated in the DOE–EERC Cooperative Agreement, namely, 1) to advance foundational science and 2) to inform data-driven policies that enhance U.S. economic growth and job creation, energy security, and environmental quality. Activity 1 In North Dakota, there is synergistic incentive to develop and implement CO2 EOR technologies. Regional industry partners are actively seeking options that can cost-effectively improve the efficiency of power production, while also coproducing CO2 for use in EOR applications. A full-value-chain techno-economic assessment that links lignite resources, power generation, and EOR is needed to determine the implications for a state or region to continue to use these resources or look elsewhere for other energy sources and revenue streams. The integration of North Dakota’s lignite power industry with the state’s oil industry has the potential to revitalize legacy oil fields and produce up to 1 billion barrels of additional oil using CO2 EOR while providing a market for a CO2 commodity captured at coal-fired power plants. Revitalization of North Dakota’s legacy oil fields will bring new industry investment to the state, resulting in the growth of oil-related jobs and revenue through oil sales, severance tax, and associated oilfield development activities (drilling, pipelines, etc.). CO2 demand for EOR and incremental oil production were calculated for 201 conventional oil fields in North Dakota. Infrastructure development in the fields was estimated using 1) a traditional vertical well arrangement of CO2 injectors and oil producers and 2) an advanced case where horizontal wells were used exclusively. Pipeline, compression, and recycling infrastructure requirements were also estimated. When viewed from the CO2 capture and CO2 EOR sectors, the advanced case showed a positive investment scenario when including potential benefits of the 45Q tax credit policy. An economic evaluation of a full implementation of CO2 EOR showed an average $60 billion potential state economic impact estimated over the 37-year construction and production time frame could be realized with an assumed oil price of $65/bbl. Oil price ranges of $35–$90/bbl cause an estimated variation of ±$5 billion over the potential effort. The total net state government revenues were estimated over the 37-year construction and production time frame. With an assumed oil price of $65/bbl, total potential fiscal impact could average $7.4 billion. This result ranges about ±$2.5 billion for a potential EOR implementation effort for oil price ranges of $35–$90/bbl. This broad-brush assessment was focused on “magnitude-of-effect” perspectives of what CO2 capture and use for EOR could mean to the state. Whether CO2 EOR ever becomes widely adopted is not the issue at this stage of evaluation. The question being answered is, How valuable could CO2 capture and CO2 EOR be for the state and local jurisdictions in western North Dakota? The results of the current economic assessment remove any ambiguity to that question. Full implementation of CO2 EOR as modeled in this study provides substantial economic benefits to the state, even at low oil prices (i.e., $35/bbl). Job creation and government revenues could be substantial, depending on the scale of implementation. With a better understanding of what CO2 EOR might mean for the state’s economy, the focus can now shift to the policies and financial mechanisms needed to make private investment in CO2 capture and use as EOR competitive with other energy-related pursuits. Activity 2 ROZs contain remnants of oil not swept away by natural waterflooding. Although nearly all of the identified ROZs are found in West Texas, there is evidence that this category of oil reservoir can be found in other major oil-producing basins of the United States. Because the formation of these oil reservoirs is distinct from other conventional reservoirs, the method to estimate the prospective CO2 storage resource in ROZs may be equally distinct from the method used for conventional fields. As such, the EERC collaborated with DOE’s National Energy Technology Laboratory (NETL) to investigate the feasibility of CO2 storage in ROZs and determine what specific modification (if any) needs to be made to the current DOE volumetric method to estimate prospective CO2 storage resource in oil reservoirs. This activity built on a previous EERC investigation to identify ROZs in the Williston and Powder River Basins and upon collaborations between the EERC and NETL to develop storage resource estimation methods for different types of geologic CO2 storage. Review of the volumetric approach raised questions about the applicability of such an approach to hydrocarbon-bearing zones without the inclusion of potential hydrocarbon production. A production-based approach was presented by the EERC to inform the working group of additional methods of increasing the CO2 storage resource potential. Because the production-based method focuses more heavily on oil recovery than CO2 storage, it was not included in the working group manuscript. Activity 3 The EERC has used sparse and irregular seismic arrays to detect CO2 injected into a reservoir. The variability of seismic noise recorded by the sensors directly impacts the seismic interpretation. However, designing noise attenuation workflows effectively can be a more challenging task using sparse and irregular arrays for data acquisition. Based on the hypothesis that noncoherent noise is stationary during weekly data acquisition, a new machine-learning algorithm was developed to automatically estimate noise conditions using passive records, noise from active records, and ancillary information. The new noise attenuation processing workflow can improve the time-lapse detection of CO2 from sparse and irregular array acquisitions. Results show spatial and temporal noise patterns can be related to the location of the sensors and the weather conditions during the data acquisition and that our attenuation processing workflow can improve the time-lapse detection of CO2 from sparse and irregular array acquisitions. This effort was funded in part through the EERC–DOE Joint Program on Research and Development for Fossil Energy-Related Resources Cooperative Agreement No. DE-FE0024233. Nonfederal funding was provided by the North Dakota Department of Commerce.