EOR as a Carbon Management Tool

Thanks for sharing, Gary-- are you seeing that oil producers are moving forward with EOR with the assumption that a carbon tax is coming at some point, in some form? Or would EOR be profitable and a prudent decision for them regardless of how that debate plays out? 

I cannot see it happening.  The numbers just don´t work, especially with EOR.

Even when the economics are aligned, another problem facing CO2 EOR developments is that while they may be ­carbon-neutral upon startup, or even carbon-negative, such status is fleeting.

It is estimated that at least 99% of the CO2 used in EOR remains in the formation forever. Despite this, the carbon-intensity of the operation itself and the inevitable combustion of the produced oil will one day turn the field into a carbon-positive asset....

Lax accounting will always elongate the carbon-negative period. But if the strictest measurements are made, ones that take the full carbon life cycle of an EOR project into account, then a 20-year span of carbon-­negative production becomes more like 5 or 8 years.

However,  I am not sure I follow Gary´s argument here.  Once the asset turns carbon positive, much less than 99% will stay in the reservoir, especially with the "lax accounting".  Am I missing something here?

Of course, a national carbon tax or subsidy of sufficient size per tonne of CO2 sequestered could do it. But, I cannot imagine that it will be done.  Alternatively, just a $1 per gallon tax on the cost of gasoline, with an increase over time, would do more to reduce consumption and carbon emissions. But, that proposal would die long before it reached the Senate, as it has before, even with today´s availability of a good option, i.e. EV. Maybe if Elon Musk can keep his promise for far cheaper EVs, the market will take over and reduce gasoline and diesel consumption.

I take issue with the quote from the JPT article about the eventual carbon positive nature of oil produced from CO2-based EOR. It's predicated on an assumption that may seem intuitive, but is in fact wrong (IMO): that increasing the amount of oil ultimately recovered from a given field will increase the world total of oil that will be eventually be burned.

That's saying, in effect, that consumption of fossil fuels will be supply limited. I.e, that we won't stop burning them until we run out. If that were true, we all might as well hang it up, because the supply available is enough to fry the planet. We'd recreate the conditons of the PETM, when the tropics and lower temperate latitudes were too hot for mamalian life.

Fortunately, oil has become a demand-limited commodity. Battery technology has crossed a threshold, and EVs are now recognized as more economical than gasoline and diesel-powered transportation. The demand for oil in developed countries has peaked, while the rise that would otherwise be expected in developing countries is restrained by knowledge that BEVs will soon be cheaper to buy and operate. As a result, there is almost no short-term demand elasticity for oil, and only limited long-term elasticity. (I.e, demand for oil responds weakly and slowly to changes in oil prices.)

Under these conditions, oil production increases from one field inevitably translate to reductions from other fields. Or, more likely, to reduced exploration and development of new fields. Which is exactly what we want.

My conclusion: CO2-based EOR is unequivocally carbon-negative, and helpful in fighting climate change.