San Antonio Express-News (Sunday)
Big Oil bets on carbon capture for net-zero goal
HOUSTON — Oil executives at the World Petroleum Congress last week outlined their case for carbon capture as a key way to reduce greenhouse gas emissions from the industry and keep fossil fuels viable in a low-carbon future.
The decades-old technology, which captures carbon dioxide from the atmosphere or industrial operations and buries it underground, could help oil producers and carbon-intensive industries such as cement, steel and petrochemicals eliminate emissions from their operations. The International Energy Agency, the United Nations’ Intergovernmental Panel on Climate Change and academics from Columbia University have said carbon capture is critical to help the world meet its net-zero emissions target by 2050.
“Carbon capture is one of the few proven technologies that could enable these hard-to-decarbonize sectors to decarbonize,” said Joe Blommaert, president of Exxon Mobil’s Low Carbon Solutions business. “Renewable and alternative power sources are very important, but they can only address a portion of emissions associated with some of these industrial processes.”
Oil companies, including Irving-based Exxon and Houstonbased Occidental Petroleum, are investing in carbon capture projects as public and investor pressures mount over climate change. While many European oil majors are responding to climate risks by shifting investments from fossil fuels to wind and solar power, American oil giants are investing in carbon capture and storage facilities in the hope of gaining public approval to keep extracting fossil fuels.
Houston could emerge as a major carbon capture hub, because of its proximity to the Gulf of Mexico and its concentration of chemical plants, refineries other industries that spew greenhouse gases. The Gulf ’s underground caverns could store an estimated 500 billion tons of carbon dioxide, which is enough to hold all U.S. carbon emissions for more than a century.
Exxon this week convened a meeting at the University of Houston with 10 industry partners to discuss ways to make its vision for a $100 billion carbon capture and storage hub in Houston a reality. Its proposed hub, which would take emissions from the city’s petrochemical plants and store it in the Gulf of Mexico, is expected to capture and permanently store about 100 million tons of carbon dioxide by 2040, the equivalent to planting trees in a forest the size of California.
“I’m very, very excited about the progress in this concept, which will be instrumental to Houston achieving its net-zero objective,” Blommaert said.
The Irving oil major earlier this month said it plans to spend $15 billion over the next six years on low-carbon projects such as carbon capture, and expand its carbon capture and storage capacity at its LaBarge, Wyo., helium plant, which is also the world’s largest carbon capture facility that captures up to 7 million tons of carbon dioxide annually.
Exxon also is developing carbon capture projects in Europe, and has set its sights on Asia, where it plans to announce projects in the near future.
Oxy, which has ambitions to become a leading carbon management company, is developing its first direct-air carbon capture facility in the Permian Basin of West Texas, which will be the largest facility of its kind in the world capable of removing up to 1 million tons of carbon dioxide from the atmosphere annually. The Houston independent has also invested in a new natural gas power plant in LaPorte that captures carbon dioxide, and is also developing a renewable fuels manufacturing plant in Canada that will use carbon dioxide captured from the air.
“The overwhelming message that came out of (the United Nations’ climate summit) COP26 was that without direct-air capture, we absolutely cannot achieve our goals of (limiting global warming to) 1.5 (degrees Celsius),” said Oxy CEO Vicki Hollub. “So that was a positive coming out of COP26 for this technology.”
Carbon capture, however, is still an expensive technology that has yet to achieve mass scale to make a dent in global emissions. Blommaert and Hollub said expanding carbon capture will require government support and a carbon tax to attract investment needed to bring it to scale.
Exxon, in particular, has been a vocal proponent of a carbon tax. The company has been capturing carbon dioxide from its operations for decades, and has captured more carbon dioxide than any other company in the world, Blommaert said.
“Industry cannot do it all by itself,” Blommaert said. “Supportive governments are essential, along with durable technology agnostic policies that without picking winners, allows a level playing field that will be critical for widespread deployment of carbon capture and sequestration.”
Mike Sommers, president of the American Petroleum Institute, said the oil trade group has been lobbying for a tax credit in the bipartisan infrastructure bill under debate in Congress to help spur investment in carbon capture and storage.
“Carbon capture, utilization and storage will be a game changer for this industry,” Sommers said.
Hollub said it will also take more collaboration between oil companies, carbon capture ventures and governments to expand the technology. Oxy’s venture arm, Oxy Low Carbon Ventures, has partnered with several companies such as Canada-based Carbon Engineering to develop its carbon capture projects.
“We need partnerships to be with government regulators, to be with passionate environmentalists and those who care and are pushing to make our planet a better place to be and to actually save our planet for future generations,” Hollub said. “And then I think over time, we will build enough trust, enough respect, that we can start building those external partnerships that are going to make the whole industry a little more acceptable to those that have been so opposed to what we do and so committed to try to shut us down.”