Lucid Energy Group is moving forward with plans to develop what will become the Permian basin’s largest carbon capture and sequestration (CCS) project at the operator’s northern Delaware basin Red Hills natural gas processing complex in Lea County, NM, about 15 miles northwest of Jal.
The US Environmental Protection Agency (EPA) has approved Lucid’s previously submitted monitoring, reporting, and verification (MRV) plan for the project, which aims to safely ensure permanent CCS of carbon dioxide (CO2) from natural gas volumes the operator processes and treats for customers at the complex, Lucid said on Jan. 11.
Scalable and designed for future growth capacity, the CCS project will allow for sequestration and permanent storage of CO2 in Lucid’s existing and permitted disposal wells, according to the operator.
Alongside enabling Lucid to offer a lower carbon-intensity (CI) service to customers and reduced operational carbon footprint to stakeholders, the Red Hills MVP plan—pending subsequent approval by the US Internal Revenue Service—also will provide Lucid certain CCS-related tax credits, the company said.
Lucid—which currently removes more CO2 from Permian basin shale production than any other midstream operator—will develop the CCS project by simply modifying and expanding existing operations at the Red Hills complex, said Mike Latchem, Lucid’s chief executive officer.
While Lucid did not directly confirm a definitive timeline for the planned CCS project, the operator informed EPA officials that it intended to immediately implement the MVR plan upon its approval by the agency, according to official EPA documents published in December 2021.
Red Hills capacity overview
As the Delaware basin’s largest gas processing complex, Lucid’s Red Hills site consists of five plants with a combined processing capacity of 920 MMcfd (OGJ Online, Mar. 23, 2021).
Individual plant capacities include:
- Red Hills I, 60 MMcfd.
- Red Hills II, 200 MMcfd.
- Red Hills III, 200 MMcfd.
- Red Hills IV, 230 MMcfd.
- Red Hills V, 230 MMcfd.
Development of a sixth plant at the site—the 230-MMcfd Red Hills VI plant—was also under way during 2021, according to the operator’s latest sustainability report.