The race for carbon capture utilization and sequestration projects is on, and North Dakota has done much to be first out the gate.
However, there is one crucial component it has missed — the creation of pre-permitted carbon dioxide corridors. Wyoming has already done this, and it’s a potential game changer in the space.
North Dakota is at the forefront of CCUS and sees what Gov. Doug Burgum described as a “cascade” of $25 billion in potential CCUS projects. But there are fears the state could lose some of this business to Wyoming, which also has Class VI primacy, and has also created pre-permitted corridors to efficiently move carbon dioxide around the state.
The situation has prompted a proposal from North Dakota’s Oil and Gas Division to use $1 million of the state’s $1.1 billion in American Rescue Plan Act funds to create carbon corridors of its own. That, combined with the regulatory framework North Dakota already has in place for CCUS projects, should keep it front and center for the best opportunities.
“We’ve submitted a request to hire an engineering firm to look at all of the state’s sources and sinks,” North Dakota Department of Mineral Resources Director Lynn Helms told the Williston Herald. “(They will) analyze and determine ideal pipeline corridors that avoid, to the extent possible, water crossings and hazards like landslides and those sorts of things.”
Helms said efficient use of pore space as a reservoir for sequestered carbon dioxide will ultimately rely on delivering the pressurized waste stream to the locations that have ideal geology for a carbon sink.
“We want to make sure that we’ve identified the most economic and environmentally friendly pipeline corridors for infrastructure to move carbon dioxide around the state,” Helms said. “In an ideal world, we’d also like to get it to some Bakken oil fields, you know, and be able to produce low-carbon oil.”
During the most recent North Dakota Industrial Commission meeting, Helms noted there is a short window for the existing 451 tax credit.
“We want to make sure we reduce or remove every possible delay or barrier,” he said, referring to a map of the carbon dioxide. “You can see that it’s really complicated dot-to-dot with where our sources are and where our possible sinks are. And so being able to map out the most environmentally friendly routes, and to pre-approve those, would be a huge step up.”
Burgum agreed that pre-approved corridors could give Wyoming a leg up right now.
“We do know that there is going to be, when we’re competing for projects then, it’s not just the price, it’s also the speed to market,” he said. “In this case, the revenue associated with the federal guidelines. So we can actually lose business to Wyoming if they have got pre-approved corridors and we don’t.”
Helms suggested the state’s regulatory framework, plus pre-permitted corridors would put North Dakota in a position that’s very hard to beat.
“They don’t have amalgamation, but they have corridors,” Helms said. “We’ve got amalgamation and we would like to have, I think we should have corridors. And as you can see from the map, there are lots of things. There are lots of water crossings and landslides and all sorts of things that we need to avoid and we think can pre-do a lot of that work and really have things ready to roll for our ethanol and coal facilities.”
The carbon dioxide corridors were one of two proposals the Oil and Gas Division presented to the state’s Appropriation Committee, which is reviewing more than 100 proposals for use of ARPA funds. The other oil and gas project requests $6 million in Biden bucks for an extension of Bakken Restart, the state’s plugging and reclamation program for orphaned oil wells. The funds would convert up to 32 orphaned wells in western North Dakota into livestock water supply wells. That could help ranchers with drought situations like what the region experienced this year.
Division of Oil and Gas has already converted some wells to livestock water supply wells. They worked with the Medora Grazing Association to convert six wells as part of the Bakken Restart Program, which was allocated $66 million in CARES Act funding to put oil and gas workers back to work plugging and reclaiming orphaned or abandoned wells.
Each well cost an average $200,000 to convert. They were plugged back to the Fox Hills formation, at a depth of 1,400 feet.