The Industry
The majority of CO2 EOR projects are currently undertaken by independents, and even the original SACROC project that proved the economic viability of CO2 EOR, was sold by Chevron to Kinder Morgan in 2000. Kinder Morgan is now one of the largest oil producer in Texas. The largest is Occidental Petroleum, who operates more than half of the current EOR projects (29 in all) in the Permian Basin, and is the largest oil producer in Texas, producing approximately 90 million incremental barrels of oil per day. Hess who also operates in Texas with six CO2 EOR projects, and is producing approximately 25 million barrels of oil per day. In comparison, Kinder Morgan’s single EOR project produces approximately 24 million barrels of oil per day.
In the Permian Basin, where CO2 EOR got its start, the readily available source of low-cost CO2 gas drove the EOR boom in the 1970’s and 1980’s there. The first commercial CO2 gas flood took place in 1972, in the SACROC Unit. Chevron recovered CO2 gas for this project from a natural gas processing plant in the southeastern part of the Basin that would have been vented into the atmosphere, and transported it 220 miles north to inject into the oil wells in the SACROC Unit. The success of this project, led to the construction of three major CO2 gas pipelines connecting the oil fields with natural underground CO2 sources located in the McElmo Dome reservoir and the Sheep Mountain field in Colorado, and with the Bravo Dome in New Mexico. Today, field operators inject more than 1.6 billion cubic feet of CO2 gas per day into the Permian Basin, and produce over 170,000 barrels of incremental oil per day across dozens of fields there.
The Bravo Dome is a large CO2 gas formation in Mississippi, and Denbury Resources is developing a similar infrastructure to that created in the Permian Basin in the Mississippi and Louisiana area. Denbury currently operates 13 CO2 EOR projects, and plans to build a substantial extension from its existing pipelines to Louisiana to deliver CO2 gas to the Hastings Field in Texas for oil field injection there. Denbury is also working with industrial plant operators along their pipeline route to obtain additional supplies of CO2 gas for use in CO2 EOR projects in all three states where they operate.
In a study performed my Montana Tech University, CO2 flooding of the Montana Elm Coulee and Cedar Creek fields could result in the recovery of 666 million barrels of incremental oil.