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US faces CO₂ shortage

Contamination and new customers exacerbate seasonal supply tightness

by Craig Bettenhausen
August 17, 2022 | A version of this story appeared in Volume 100, Issue 29


A gauge on a liquid CO2 tank shows that it is about 3/4 full.
Credit: Craig Bettenhausen/C&EN
Conner Bottling Works in Newfields, New Hampshire, has enough liquid CO2 for now for it's soda bottling business, but supplies in the region are getting tight.

As the US enacts legislation to combat the accumulation of carbon dioxide in the atmosphere, industrial buyers of purified CO2 are feeling the pinch of a supply shortage across the country, especially on the coasts. Users of food- and beverage-grade CO2 are being especially hard-hit. For the past 2–3 months, many US CO2 users have been able to get only 30–50% of what they normally use, according Bob Yeoman, executive vice president at the medical and industrial gas and services firm B&R Compliance. “I go back to the 1980s; It’s the worst I can remember,” he says.

Conner Bottling Works, a 159-year-old family soda-bottling and beverage-distribution business in eastern New Hampshire, tells C&EN that the bar- and restaurant-sized CO2 tanks it distributes are currently back-ordered by 6–8 weeks, whereas normally they are freely available. The firm says it filled the 250 kg liquid CO2 tank they use to bottle local favorite Squamscott Soda a couple weeks ago without trouble, but its gas distributor, Chart Industries, warned them of disruptions coming over the next few months.

Gas-industry watchers trace the problems back to CO2 extracted from geological deposits in the Jackson Dome formation in Mississippi, which has been coming up contaminated with ethane, benzene, and other hydrocarbons. Maura D. Garvey, an industrial gas expert at the consulting firm Intelligas, says that though mined CO2 always requires some cleanup, the elevated contaminant levels are more than what the industry’s fleet of scrubbing equipment can handle without slowing down production.

Such intentionally extracted CO2 accounts for around 24% of the US supply of “merchant CO2,” a category that includes all industrial uses except for enhanced oil recovery (EOR), she says, and Jackson Dome alone contributes 15% of US merchant CO2 annual production capacity.

Garvey and other industry watchers place the blame for the shortage on decisions by Denbury Resources, the firm that controls Jackson Dome, to reconfigure production. “The impact of Denbury switching wells to EOR and utilizing other wells with contaminants for merchant CO2 feedstock affected the ability of the merchant CO2 suppliers to operate at full capacity during the peak summer demand season,” she says. “Unfortunately, this aggregated an already tight supply situation because of ammonia plant closures for maintenance that occur every year at this time, after the fertilizer season.”

The CO2 side-stream from fertilizer ammonia production accounts for 23% of the US supply, Garvey wrote in a recent industry report. “This summer’s shortage was anticipated by the industry, but the Denbury supply disruption makes this one of the worst shortages in the past decade,” she says.

In an email to C&EN, Denbury acknowledged that some food and beverage customers are facing purity issues, but said gas distributors are primarily responsible for addressing it. “The CO2 produced at Jackson Dome has been and is being produced within all regulatory requirements, and the composition of the delivered CO2 continues to meet contractual specifications. Denbury and our industrial customers are well aware that the CO2 from Jackson Dome includes small amounts of other naturally-occurring components.”

A growing imbalance between supply and demand is a bigger and more durable issue than contamination is, Yeoman says. Demand from dry ice makers, for shipping, and from the cannabis industry, for cannabinoid and terpene extraction, have been growing quickly, and not enough new capacity is coming online to compensate. The situation may get worse as the Inflation Reduction Act comes into force, he says, because industrial uses are lumped in with enhanced oil recovery in a lower tier of incentives than those offered for geologic CO2 sequestration, which could pull more CO2 out of the merchant market..


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