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Oil and gas firms pitch pipelines for CO₂ capture

Kinder Morgan, Valero invest in pipelines and other projects

by Craig Bettenhausen
April 1, 2021 | A version of this story appeared in Volume 99, Issue 12


A photo of several silos, tanks, and other agricultural equipment on the edge of a farm.
Credit: Matt Oaks/Shutterstock
Biofuel makers like this corn ethanol plant in Iowa are among the firms Valero hopes to sign as customers for its planned CO2 pipeline network.

Some oil and gas firms are leveraging their expertise in handling CO2 to create a new crop of customers based on carbon capture equipment and services.

The pipeline company Kinder Morgan formed a New Energy Transition Ventures division in mid-March that will invest in carbon capture and sequestration as well as in hydrogen production and renewable energy.

Kinder Morgan sells CO2 on a billion-dollar scale annually, with almost all of it coming from underground deposits and being used for enhanced oil recovery. “Now we’re looking to invest upstream in the form of carbon capture,” group president Jesse Arenivas told Bloomberg.

Separately, the fuel and petrochemical maker Valero is planning a 2,000 km network of liquid CO2 pipelines in Nebraska, Iowa, South Dakota, Minnesota, and Illinois. The pipelines are intended to bring CO2 from ethanol makers and other industrial sources in the Midwest to sequestration sites in southern Illinois.

Federal, state, academic, and corporate researchers have been studying the region’s carbon storage capacity for several years. Large, deep saline reservoirs and sandstone formations that could hold billions of tons of CO2 abound in the area, according to a 2019 study sponsored by the US Department of Energy.

Southern Illinois also contains exhausted oil wells that could be revived using enhanced oil recovery based on CO2 injection, the report notes.

Valero expects its project to transport 5 million–8 million metric tons of CO2 per year. The firm is soliciting customers that might want to send their CO2 down the pipelines.



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