Mississippi and the Emerging Carbon Storage Industry

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For decades, the natural resources of an extinct volcano called Jackson Dome, about 3,000 feet below Mississippi’s capital, gave the state a role in a multistate oil extraction venture.

The operation, known as enhanced oil recovery or EOR, takes naturally occurring carbon dioxide from the Dome, sends it through a pipeline to the oilfields of Mississippi, Louisiana and Texas, and injects CO2 into the ground to expel oil for production.

Now, as the U.S. government tries to encourage reductions in emissions from industrial sources, Mississippi lawmakers are hoping the same pipeline, owned by Denbury Inc., will give the state a new role in the sector. emerge from carbon capture.

Carbon capture and storage, or CCS, is an expensive method of reducing greenhouse gas emissions in which a company separates CO2 from other gases it produces, then transports it to a storage site where it is injected into the ground for permanent storage.

Although CCS has been around for years, it was too expensive for companies to consider it without any incentive. But in 2018, the federal government enacted a tax credit that dramatically expanded the incentives for issuers.

Representative of Mississippi House Energy President Brent Powell, R-Brandon, explained that companies hoping to receive the tax credit could potentially relocate to the state and use its existing pipeline for storage.

“What we hope with this is that landowners and the public can get royalties for storage, but we would really like to see industry come into the state near the pipeline,” said Powell, who has clarified electricity. and fertilizer plants as businesses he plans to offload their carbon to Mississippi.

Under the program, owners of surface rights and mining rights would be compensated, said Powell, who drafted the bill.

This year, Governor Tate Reeves signed into law House Bill 1214, a bill that would allow the Mississippi State Oil & Gas Board to oversee a carbon storage program in the state.

The U.S. Environmental Protection Agency currently regulates carbon sinks across much of the country, but states are now hoping to seek approval to meet growing local interest.

The Oil & Gas Board must first obtain EPA approval, which it plans to seek by the end of the year, the board told Mississippi Today. So far, only Wyoming and North Dakota have such a program, according to the Carbon Capture Coalition.

Oil & Gas Board chief geologist David Snodgrass said eminent domain would not apply to carbon storage in Mississippi. Eminent domain, which was restricted in the state after a ballot initiative in 2011, gives the government the power to take private property for public use project without the landowners’ consent. Companies looking to build a carbon pipeline or storage wells would first have to get approval from a majority of landowners.

The new law allows the Oil & Gas Board to go ahead with the project without majority approval, but Powell said it would only apply if there were unresponsive landowners or absent.

“If a guy is adamant, ‘You’re not crossing my property,’ the Council won’t let (the company) cross his property,” Powell said.

Experts suggest that Mississippi, along with its neighboring states, are prime locations for carbon storage due to their geology.

Susan Hovorka, a researcher at the University of Texas Jackson School of Geosciences, explained that pore space – tiny openings between rock grains in the ground where gas can be stored – gives the region the coast Gulf an advantage over the rest of the country.

“The Gulf Coast states are particularly well endowed, when you look at the maps of pore space availability, those states shine as winners,” Hovorka said. “There are other states that have opportunities, but the opportunities in the Gulf Coast states are particularly excellent.”

Beginning in 2008, Hovorka and other scientists conducted one of the first large-scale carbon storage tests in the United States at an oil field near Natchez owned by Denbury Inc.

Hovorka said that although the program is new to most parts of the world, there is a well-established practice for storing carbon safely.

“People can trust because it’s not new things being done for the first time,” she said, mentioning the world’s first commercial capture and storage project in Norway which started in 1996. “It’s old things being used for new purposes to mitigate greenhouse gases.”

But storing carbon and transporting it are two different things.

Last month, the Pipeline and Hazardous Materials Safety Administration, or PHMSA — the federal pipeline safety agency — announced its findings on a 2020 gas leak in Satartia, Mississippi. The report found multiple failures by Denbury and proposed a $3.9 million penalty against the company.

After the Sataria episode, some supporters wonder if the country is prepared for increased demand for carbon transport.

While both Powell and Snodgrass have referred to the company as a supporter of launching a program in the state, Denbury officials told Mississippi Today it was too early to say whether it would begin storage. carbon in the state. Denbury is currently securing spaces in other Gulf Coast states, including Louisiana and Alabama, but would likely not begin storage until 2025.

“I would say it’s premature,” said Dan Cole, vice president of carbon capture, utilization and storage at Denbury. “We are certainly evaluating, are there any good potential storage sites in Mississippi?”

Cole said Denbury would consider large lots with few owners. He added that the company would use its existing EOR pipeline as long as it met capacity needs for carbon transport.

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