The State Mineral and Energy Board approved the first two agreements that lay the groundwork for carbon capture in Louisiana on state lands.
The board debated the topic during executive session Wednesday morning before approving deals with Houston-based Capio Sequestration and Pennsylvania-based Air Products Blue Energy. Both companies requested permission to drill injection wells deep underground to permanently store carbon through a process known as sequestration.
Capio is expected to pay the state nearly $1.3 million up front in addition to $2.2 million each year in rent and $1.60 per ton of carbon stored as part of its deal. Air Products would pay by the acre which totals $6.1 million plus $1.50 per ton of carbon stored.
During the public comment, several other companies vying for some of the same public land swaths for their own carbon capture projects protested. Those firms protesting included Shell, Denbury Carbon Solutions and Perdue Petroleum.
Shell asked the board to accept a proposal in June, which includes state lands in the other companies’ agreements. Shell’s agreement could net the state $100 million more than the deals with Capio and Air Products Blue Energy, said Lee Stockwell, general manager for carbon capture.
“We’ve offered to pay a substantial amount up front,” Stockwell said.
Board chair Paul Segura Jr. said that Louisiana is “flattered” with all of the interest for carbon capture but declined to disclose why Capio and Air Products were chosen, citing the executive session discussion.
“We’ve gotten a lot of interest and we’re challenged with making the decisions with what is best for the state,” Segura said. “Each of these deals are a little different.”
The process includes removing emissions such as carbon dioxide and pumping it under pressure which causes the gas to become liquid and therefore more likely to remain deep underground for decades. Louisiana state leaders want to reduce net greenhouse gas emissions up to 50% by 2030 and hit ‘net zero’ by 2050. Carbon capture technology is a key facet of that plan.
Capio’s project is tied to the proposed Gron Fuels complex at the Port of Greater Baton Rouge being developed my Fidelis Infrastructure. The company called the plans a “key component” to its overall complex which would manufacture renewable diesel fuel.
Capio wants to drill wells across … Continue Reading Full Story >>>