University of Texas at Austin

CO2 Sequestration in Hydrocarbon Reservoirs

Mark H. Holtz and Robert J. Finley

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Emissions of industrial greenhouse gases have increased the total load of carbon in the atmosphere. Although the long-term consequences of these emissions are hotly debated, one possible outcome is the alteration of global climate as greenhouse gases trap heat at the Earth's surface. The electricity-generation industry is currently a major source of atmospheric CO2 emissions, and one industry challenge in the coming decades may be to profitably employ advanced technology that reduces CO2 output while maintaining generation availability and reliability. There are likely to be many different strategies applied to new generation additions, but the viable alternatives for existing facilities are relatively limited. Capture and sequestration of CO2 in mature oil reservoirs appear to be one important management alternative for the existing generating unit. The likelihood that CO2 disposal in hydrocarbon reservoirs will become economically feasible is greatly increased if the disposal process provides readily quantifiable ancillary benefits, such as enhanced oil recovery (EOR) though CO2 injection. Whereas the benefits of reducing CO2 emissions are long term, global, and potentially difficult to quantify, the benefits of enhanced oil recovery are immediate and quantifiable. The proximity of large power plants to oil and gas reservoirs, many of them nearing their apparent economic limit, makes Texas the logical geographic area to test the feasibility of this method of greenhouse-gas sequestration in the United States. Funded by the Electric Power Research Institute, this preliminary Bureau investigation evaluated the suitability of Texas reservoirs for sequestering CO2 produced by major power plants. Preliminary analyses indicate that CO2 capture for lignite- and coal-fired plants in Texas may be cost effective when compared with fuel-switching these same boilers to natural gas. From a policy standpoint, it may be desirable to encourage CO2 capture retrofit initially, as opposed to fuel switching, to achieve overall lower levels of CO2 emissions at a comparable cost. Previous research indicated that a primary target for EOR in Texas is estimated at 74 billion stock-tank barrels (BSTB) of residual oil. This study finds that 8 BSTB of this resource is within a 90-mi (145-km) radius of the candidate coal- or lignite-fired plants in Texas. Additional oil resources beyond this 8 BSTB are also available from oil fields located near natural-gas-fired facilities, but additional CO2 -effluent-management issues need to be addressed with these facilities. Factors influencing the recovery of these resources include CO2 production cost and availability, generation-unit characteristics, transportation cost, environmental regulations, and oil prices. Modeling conducted in this study indicates that CO2 flooding can produce oil that would not otherwise be recovered, at an incremental cost between $6 and $16 per stock-tank barrel. In addition, it is likely that between 12 and 20 years of CO2 production from the candidate lignite- or coal-fired boilers can be sequestered from these generation facilities. Therefore, we conclude that there is substantial potential for using utility plant boiler effluent as a CO2 supply source for flooding and using mature oil reservoirs for CO2 sequestration. Development of this potential resource base may be facilitated through further research and policy initiatives.


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