Many emerging companies in the removals sector are already taking extra steps to try and ensure greater transparency, particularly when it comes to the complex field of nature-based removals. “If done right, they can offer lots of benefits, but there’s a need for good data collection to establish additionality and benefits.” “If you’re taking CO2 and using it as an input for making polymers or cement or concrete, or forms of geological sequestration such as forestry and soil carbon, these are more permanent removals,” he says. He highlights companies such as Novomer and LanzaTech which have made progress in capturing carbon and transforming it into plastic. In particular, Ranade believes that greater value needs to be placed on credits associated with longer-term carbon removals. They all offer different levels of benefit for climate mitigation, and that needs to be priced in.” Permanently Removing Carbon “Offsets, credits for using zero carbon electricity, credits for using carbon dioxide as a raw material, and credits for carbon sequestration. It could be a major long-term growth driver for the midstream giant, potentially giving it lots of fuel to increase its high-yielding dividend in the future.“There are different kinds of carbon credits,” says Ranade. That gives it all the tools necessary to become a leader in the emerging CCUS sector. Kinder Morgan is already a leader in transporting and utilizing carbon dioxide for its EOR business. A potential sizable long-term growth driver Kinder Morgan has the expertise and existing infrastructure in both areas, which should give it a leg up on capturing future investment opportunities. Meanwhile, the country will need to invest another $80 billion in developing those storage sites. will need to invest nearly $225 billion through 2050 in building about 70,000 miles of pipeline to transport carbon dioxide to sequestration and utilization sites. According to one industry estimate, the U.S. Kinder Morgan believes its existing infrastructure and expertise put it in an excellent position to capture future CCS opportunities. It will then move the gas through its Cortez pipeline to an existing sequestration site in the Permian Basin. Kinder Morgan is investing about $50 million into the venture, which will capture carbon dioxide from two natural gas-treating facilities in Colorado. The company and a partner have already started construction on a carbon capture project that they expect to complete later this year. Kinder Morgan believes it can leverage its expertise in carbon dioxide and existing infrastructure to become a major player in the emerging CCUS market. The company's carbon dioxide business generates lots of free cash flow. It transports the gas to legacy oil fields in the Permian Basin, where Kinder Morgan and third parties inject it into those fields to produce oil through EOR. The company's integrated operations produce carbon dioxide from naturally occurring source fields. Kinder Morgan also has extensive carbon dioxide infrastructure: Exxon now has 1,300 miles of carbon dioxide pipelines and 15 strategically located onshore storage sites. Exxon has since signed a couple more commercial agreements with carbon emitters and bulked up its carbon capabilities by acquiring Denbury Resources, a leader in EOR and carbon dioxide infrastructure. Exxon will transport the captured carbon dioxide through pipelines operated by EnLink Midstream. In 2022, it signed the largest-of-its-kind commercial agreement to capture and permanently store up to 2 million metric tons of carbon dioxide per year from one of CF Industries' manufacturing complexes in Louisiana. Exxon has already started to seize this opportunity. has the potential to significantly increase its carbon capture capacity over the coming decades:Įnergy companies like ExxonMobil believe that providing decarbonization services could become a very lucrative business. However, that could change in the future as more companies invest in the technology. doesn't currently capture much carbon dioxide. The captured carbon dioxide can then be utilized (e.g., for enhanced oil recovery ) or sequestered underground. Current technology can capture the greenhouse gas from emission sources or pull it directly from the atmosphere. Drilling down into carbon capture's potentialĬarbon capture, utilization, and sequestration (CCUS) could play a vital role in helping reduce global emissions.
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