INGAA Foundation study considers CCS pipeline infrastructure issues

The INGAA Foundation Inc. has released the first study of possible pipeline carbon capture and sequestration infrastructure requirements under a national mandatory greenhouse gas emission reduction program.

Its major conclusion was that while there are not significant technological challenges associated with pipelines transporting carbon dioxide, threshold questions associated with business and regulatory structures must be answered before there is likely to be significant capital invested in creating such a pipeline network.

The goal of the Feb. 25 report by the Interstate Natural Gas Association of America's foundation was to provide a context for analyzing the size, configuration, costs, timing, commercial structure and regulation of US and Canadian pipeline systems which likely will be needed to transport captured CO2.

"While CCS technology has received a lot of attention, the challenges associated with building the necessary transportation network have yet to be fully analyzed," said INGAA President Donald F. Santa Jr., who also is the foundation's president.

"Some have suggested that the nation's natural gas transmission pipelines represent a model for what a CO2 pipeline network might look like because the North American gas pipeline network interconnects thousands of gas distribution companies, power plants and industrial facilities with multiple gas-producing basins. It made sense for the INGAA Foundation to draw on the collective wisdom of the gas pipeline industry in examining analogues that might be useful in constructing a framework for a CO2 pipeline system," he continued.

15,000-66,000 miles

Between 15,000 and 66,000 miles of transmission and distribution pipelines will be needed to transport captured CO2 by 2030, depending on how much CO2 must be sequestered and the degree to which enhanced oil recovery is involved, the study forecast. The upper end of the forecast range is similar to the miles of existing US crude oil and products pipelines, it noted.

It added that while there are no significant technical barriers to building the forecast pipeline mileage, public policy and regulation are the major challenges to implementing carbon capture and storage. Public policy questions will need to address key questions about industry structure, government support of early development, regulatory models and operating rules, the study suggested.

It said that the CCS process has three steps: CO2 capture and compression, pipeline transportation and underground storage. "While many of the underlying technologies involved in CO2 capture are mature, their use in the circumstances and scale needed for CCS carries considerable technological and commercial risks," the report noted in its executive summary.

The capture and compression stage and the storage stage are the major cost components, it said. "The capture component of CCS is the most technologically challenging and uncertain. Depending on the quality of the CO2 stream, capture costs range from nothing to over $50/metric ton. Compression costs add $9-15/metric ton," it said.

Transportation of CO2 by pipeline is a mature technology and should not change significantly in the next 20 years, it added.

Suitable storage formations

Geologic storage costs vary, depending on whether the site is an enhanced oil recovery operation, where costs are negative, or is one of various types of underground rock formations where storage costs are a few dollars per metric ton, the report said. Depleted natural gas and oil reservoirs, saline aquifers, coal beds and shales are geologic formations suitable for CO2 storage, it indicated.

"Despite little experience in large-scale geologic storage of CO2 in the United States, developments at the Sleipner [Field] in the North Salah, In Salah in Algeria and Weyburne in Saskatchewan have been successful," it continued.

Estimated geologic storage capacity in the Lower 48 US states equals more than 450 years at recent US greenhouse gas (GHG) emissions rates, according to the report. Of the estimated 3,375 billion metric tons of stage capacity, deep saline reservoirs offer the most (2,900 billion) followed by depleted oil and gas fields (110 billion), shale formations (107 billion), deep saline-filled basalt (100 billion), coal and coalbed methane formations (51 billion) and enhanced oil recovery (17 billion).

Canada's Western Canadian Sedimentary Basin has a partially estimated geologic storage capacity of more than 100 years at recent GHG emissions rates, the report said. "The full geologic storage capacity in Canada may be about 2,000 years equivalent," it said.

It noted that "well over a dozen" GHG control proposals have been considered by the US Congress. Most take a multi-sector, market-based approach using either a carbon tax or a cap-and-trade system to limit and regulate many or all US economic segments. The most recent proposals target a 60-80% reduction in US GHG emissions by 2050.

Areas of difference

The report said that the bills differ on whether the point of regulation would be upstream or downstream, and what entities might be covered or exempted in emission volume terms. "The widespread application of CCS will depend on the technology's maturity, costs, volume potential, regulatory framework, environmental impacts, public perception of safety and other mitigation options," it said in its executive summary.

It said that many observers who were interviewed for the report expect early CCS projects to primarily be situated where suitable injection sites can be found near the CO2 source so that relatively short, dedicated pipelines can be built. "Some such projects may be undertaken by a regulated utility, and will be under the jurisdiction of the relevant regulatory commission," it said.

The report said that several observers suggested that as more CCS projects are developed incorporating power plants where no suitable storage site is nearby, projects will increasing connect multiple plants to storage sites over longer distances. "The sharing of pipeline capacity among plants can help reduce the network mileage on average (averaged per CO2 source). Early and late projects may have the same average mileage per source," it said.

The report presented estimated costs for constructing new pipelines, and for compressors and pumps for those pipelines under high and low CCS cases. It also compared the existing CO2 pipeline framework with those of oil and gas pipelines, and the pros and cons of the federal government regulating CO2 pipelines.

The INGAA Foundation said that it plans to follow the study with a workshop to address questions associated with the CCS value chain, potential business models for this industry segment and other infrastructure questions.

Contact Nick Snow at nicks@pennwell.com

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