9.5 Status of CO2 EOR as CCS
The intent or objective of CCS is the long-term isolation of CO2 in the deep subsurface as a means of managing the risks of global climate change. At present, CO2 EOR operations in North America and in other oil basins in Eastern Europe, the Middle East, South America, andare injecting anthropogenic CO2 into maturing oil where the CO2 is likely to be permanently stored. The capacity for storage in these fields, while significant, is less than that available in saline reservoirs and, by itself, less than required for CCS to mitigate CO2 emissions to the atmosphere.
Additionally, for CO2 EOR projects to be recognised as CCS, certain regulatory thresholds will need to be met, including levels of reporting regarding monitoring, measurement, and verification requirements. There are no current overarching regulations or guides regarding the transition of a CO2 EOR project into a dedicated storage project. However, CO2 EOR offers benefits to the body of knowledge needed to implement CCS, including useful experience in handling and injecting CO2, modelling, predicting its behaviour in the subsurface, and demonstrating effective monitoring methodologies.
CO2 EOR may also create a revenue stream for the project proponents, since demand for CO2 EOR is driven by high oil prices which create incentives to increase the supply of oil. Although there may be a willingness to pay a high price for CO2 when oil prices are high, the price will primarily be determined by the availability of supply sources. Over the next decade the CO2 price is expected to be determined by low-cost CO2 sources. CO2 prices alone will be insufficient to support relatively high-cost projects associated with electricity or iron and steel.
CCS requires credible long-term climate change policies to enable investment in both demonstration and deployment, particularly for the majority of large-scale, relatively high-cost sources of CO2 emissions. When crediblemitigation policies are introduced, then CO2 EOR can accelerate the development of a broad-scale CCS industry – since CO2 EOR effectively brings forward the revenue stream required to support large-scale CCS projects, leading to earlier deployment than if the only driver was climate policy. In the absence of GHG policy, CO2 EOR is unlikely to lead to additional geologic storage beyond what the commercial CO2 EOR market delivers.
CO2 EOR is supporting projects today, but it will not lead to a CCS industry by itself. CO2 EOR does offer benefits to the demonstration and deployment of CCS, and it adds to the body of knowledge needed to implement CCS broadly. This includes the development of numerous materials, technologies, and industrialthat should be directly transferable to the large-scale commercial adoption of CCS across the global power and industrial economies. Overall, CO2 EOR is likely to have a substantial role in the next decade supporting CO2 storage and development of capture technology. Its role will diminish in future decades as the need to store much larger volumes of CO2 will require the use of dedicated storage such as saline aquifers.