In the recently fervent efforts of oil and gas companies to mitigate their environmental impact and improve their standing with investors and lenders, they are progressively striving to cut their own emissions of greenhouse gases and to offset the GHG emissions that are unavoidable through the use of carbon credits. Cutting emissions from well sites, pipeline operations, refineries, and the like won’t be easy or cheap, but at the least the results are measurable and provable — before, we emitted X, and now we emit X minus Y. The true value of voluntary carbon credits is more difficult to calculate. Sure, each credit is said to equal one metric ton of carbon dioxide or its equivalent, but how do you really measure with any certainty how many metric tons of CO2 will be absorbed by 1,000 acres of preserved forest in Oregon, or how much methane won’t be produced by changing the diet of 1,000 cows in Wisconsin? And how can you be sure that slice of Oregon wouldn’t have been left in place anyway, or that the dairy farmer has actually changed what he’s feeding his herd? In today’s RBN blog, we look at voluntary carbon credits, concerns about their validity, and ongoing efforts to ensure that they actually accomplish the goal of GHG reductions.
Every day, midstream companies in North America transport massive volumes of crude oil, natural gas, NGLs, and refined products to market. Without their pipelines, economic activity would rapidly grind to a halt. Still, environmental critics and ESG-conscious investors and lenders are quick to point out that the commodities that midstreamers pipe are among the leading sources of greenhouse gas emissions, and that, at the very least, pipeline companies should be reducing or even offsetting the carbon dioxide (CO2) and other GHGs associated with operating their networks. That’s now happening in a big way — and in a variety of ways — as we discuss in today’s blog.
A couple of weeks ago, Shell announced a large-scale carbon capture and sequestration initiative at its Scotford refinery complex near Edmonton, AB. It’s one of the largest recent efforts to marry hydrogen production with CCS — an increasingly popular solution informally referred to as “blue” hydrogen. Shell is not alone. Across North America, the idea of capturing carbon dioxide to clean up our collective act is quickly gaining momentum and support. Whether we’re talking about refineries, ammonia plants, steam crackers, ethanol plants, or any other carbon-generating industrial process, capturing the CO2 — making the process “blue” — is seen by many as a way to make significant progress toward climate goals without over-burdening governments or consumers with the sky-high costs associated with some of the more technically challenging energy transition technologies. Today, we discuss the energy industry’s embrace of carbon capture solutions and how it could shape our energy future.
Traveled by air in the U.S. lately? Airports and airplanes are packed to the gills. Unruly passengers are making the nightly news and becoming YouTube sensations. Jet fuel shortages are popping up. But there are other developments in air travel too, including a push by the global airline industry to rein in its greenhouse gas emissions. And the heart of that movement is sustainable aviation fuel, or SAF. While the blending of SAF with conventional jet fuel is not mandated in the U.S., the alternative fuel is gaining altitude, in part because it can generate layers of credits that can be utilized in various renewable fuel trading programs. In today’s blog, we look at the current status of renewable fuel in the U.S. aviation sector.
The law of unintended consequences may be about to play out in society’s quest to sequester — or permanently store underground via enhanced oil recovery and other means — the carbon dioxide captured at ethanol plants, power generators, and other industrial facilities in the U.S. Why? Well, there are many legitimate, important uses for that manmade CO2, including in food processing and beverage making, among other industries, and diverting large volumes of captured CO2 from them to EOR and other sequestration methods due to highly attractive government incentives may put the squeeze on CO2 supply and send prices soaring. No one said that saving the planet would be easy or uncomplicated. In today’s blog, we discuss a possible hitch in the push to reduce greenhouse gas emissions and how it might be dealt with.
Carbon-neutral hydrocarbons may sound like an oxymoron, but an increasing number of international shippers have been assembling and sending out cargoes of LNG whose expected lifecycle carbon-dioxide (CO2) emissions have been fully offset by carbon credits. What’s next? No-calorie cherry pie? No-loss gambling on DraftKings? A winning season for the Houston Texans? (Probably not.) As you’d expect, carbon-neutral cargoes of LNG — and crude oil and LPG — are designed to help hydrocarbon sellers and buyers alike meet their goals for reducing their greenhouse gas emissions (GHGs). The concept is still relatively new, though, and many of the participants in these deals are still in learning mode, seeking to gain experience with something they expect to see a lot more of soon. In today’s blog, we discuss the relatively short history of this type of shipment and the first signs that carbon-neutral hydrocarbons are about to go mainstream.
Although it’s not well publicized, Canada’s oil and gas sector is already a global leader in active projects targeting significant reductions in greenhouse gas emissions, primarily carbon dioxide. These successes — some dating back as far as Y2K — are being used as a springboard for additional projects, all aimed at helping Canada achieve its aggressive GHG-reduction goals for 2030 and beyond. The scale of many of these projects is noteworthy. In today’s blog, we discuss the existing operations and planned projects that together will help the U.S.’s northern neighbor reduce its carbon footprint.
What if crude oil could be extracted from the ground, refined into gasoline and diesel, trucked to your local service station, and used in your SUV to take that next road trip, all the while resulting in LESS CO2 being emitted into the atmosphere? That would mean carbon-negative crude. Crazy talk from a relic of the fossil (fuel) generation? Not so! Carbon-negative crude is being produced today along the U.S. Gulf Coast, assuming you buy the logic of how carbon accounting works for capturing CO2 and using it for enhanced oil recovery — EOR. In today’s blog, we’ll explore what it takes to achieve carbon-negative crude, and why there is vast potential for expanding this pathway to lower greenhouse gas emissions.
In case you hadn’t noticed, there’s a big push by the government, industry, and the broader public to reduce greenhouse gas (GHG) emissions and to offset those that do occur. Given its carbon-intensive nature, the oil and gas sector is at the heart of this activity, with almost daily announcements about carbon-neutral LNG shipments, carbon-dioxide capture and sequestration projects, and other efforts. The problem is, it can be difficult sometimes to figure out what’s real and what’s not — that is, which efforts have an actual, measurable impact and which are sort of vague or fuzzy and need to be sussed out. Today, we discuss the latest round of announcements by producers, midstreamers, refiners, and others to “green up” their operations and products.
New and expanded efforts to reduce greenhouse gases, most notably carbon dioxide, have been making headlines globally on a daily basis for a while now. Canada’s energy industry has been increasingly contributing to that newsfeed this year, with two large projects announced in Alberta that will capture, use, and sequester large volumes of CO2 generated from the oil sands as well as other sources of oil and gas production in Western Canada. In today’s blog, we review the emissions profile of the Canadian oil and gas sector and discuss two of the largest carbon capture, use, and sequestration projects announced to date.
Significantly reducing greenhouse gas emissions is an all-hands-on-deck kind of thing. More wind power? More solar? Electric vehicles? Yes, yes, and yes. Another great way to slash GHGs is to use man-made or “anthropogenic” carbon dioxide for enhanced oil recovery. EOR is an extraordinarily efficient way to permanently store CO2 deep underground. And today, the economics for EOR are being turned on their head — in a good way. For decades, the acquisition of CO2 has been a significant cost for EOR operators, requiring volumes to be produced from natural geological formations and then to be pumped to the oil fields where the CO2 is used. But things are changing. Now companies are planning to spend big bucks to capture and dispose of their CO2, meaning they may be paying someone to get rid of it. And if they pay, that flips CO2 from an operator cost to a revenue stream. The implications are profound, with operators historically motivated to use CO2 as efficiently as possible set to morph their operations to use as much CO2 as can be safely sequestered. In today’s blog, we continue our series on CO2-based EOR by looking at the coming transition in CO2/EOR economics.
The handful of enhance-oil-recovery producers in the Permian Basin secure virtually all of the carbon dioxide they use from natural CO2 reservoirs located thousands of feet below the surface. In essence, they are taking CO2 out of the ground and putting it back in during the EOR process — producing more crude oil and demonstrating that the CO2 is safely and securely stored underground. Now the challenge is to transform this proven process in a way that reduces greenhouse gas emissions. To do that, EOR producers would need to use man-made or “anthropogenic” CO2 that is captured from industrial and other sources. Well, that’s exactly what’s already happening to a significant degree in EOR operations along the Gulf Coast and in the Rockies, with plans by a leading producer in both regions to use “A-CO2” for the vast majority of its CO2 needs within a few years. In today’s blog, we continue our series on CO2-based EOR with a look at how Denbury Inc. is shifting from naturally sourced CO2 to the man-made stuff.
Using carbon dioxide for enhanced oil recovery offers tremendous potential for CO2 sequestration. The problem is, most the CO2 used in EOR today is produced from natural underground sources, only to be piped to EOR sites and put underground again. Realizing the full promise of CO2-for-EOR would require sourcing more and more anthropogenic CO2, or A-CO2 — in other words, “man-made” CO2 that is captured from power generation and industrial processes. In addition to the environmental benefits, there are two other drivers for making this switch from natural CO2 to A-CO2: the first is that some of the natural sources of CO2 used today for EOR are dwindling, and the second is that the push to sequester man-made CO2 is backed by tax credits and other government-backed incentives. No matter the CO2 sourcing, CO2-for-EOR requires pipelines to transport the CO2 from where it is produced to EOR sites. Today, we continue our series on the rapidly evolving CO2 market and the huge opportunities that may await those who pursue them.
Renewable diesel is a popular topic in the transportation fuel space, and for good reason. For one, RD provides a lower-carbon, renewable-based alternative to petroleum-based diesel; for another, it’s a chemical twin of and therefore a “drop-in” replacement for ultra-low sulfur diesel. But, most of all, there are the large financial incentives provided by California’s Low Carbon Fuel Standard, the U.S. Renewable Fuel Standard, the U.S. Biodiesel Tax Credit, and other programs, which can make RD production highly profitable. Driven by these factors, there’s a lot of renewable diesel production capacity under construction or on the drawing board: everything from greenfield projects to expansions of existing RD refineries to conversions of old-school refineries so they can make RD. Today, we put the spotlight on RD and discuss how it differs from biodiesel, how it’s produced, and the new RD capacity coming online in North America.
Hydrocarbons — mostly natural gas and coal — are still the energy source behind the lion’s share of electric power generation in the U.S. However, renewables like wind and solar are now the frontrunners when it comes to scheduled capacity additions. In fact, renewables account for about 70% of the total 37.9 gigawatts (GW) of new generating capacity under construction in 2021. Recent announcements such as final federal approval for the mammoth Vineyard Wind 1 project — by far the largest permitted offshore wind project in the U.S. to date — only bolster the view that wind power’s role in U.S. power generation will continue to grow through the 2020s. Today, we look at the surge in construction of onshore and offshore wind farms and what it means for the overall power generation mix.