Enterprise, CO2 Ventures Highlights Latest Midstream Projects

Enterprise Products Partners and Occidental Petroleum agreed in late April to develop a CO₂ transportation and sequestration system for the Texas Gulf Coast. The initial focus will be the corridor from Houston to Beaumont/Port Arthur, and would combine Enterprise’s large midstream energy sector with the subsurface characterization and CO₂ sequestration experience of Oxy Low Carbon Venture (OLCV) subsidiary.

According to the agreement, Enterprise would develop the CO₂ aggregation and transportation network using a combination of new and existing pipelines along its expansive Gulf Coast system. OLCV, through its 1PointFive business unit, is developing sequestration hubs on the Gulf Coast and across the U.S., some of which are expected to be anchored by direct air-capture (DAC) facilities. 

“For many years, Enterprise and Oxy have successfully collaborated in developing traditional oil and gas projects,” said A.J. Teague, co-CEO of Enterprise’s general partner.

Enterprise Products Partners has more than 50,000 miles of pipelines; over 260 million barrels of storage capacity for NGL, crude oil, refined products and petrochemicals; and 14 Bcf of natural gas storage capacity. 

Meanwhile, OLCV and lumber company Weyerhaeuser are exploring a potential carbon capture and sequestration project in Livingston Parish, Louisiana. Under a lease, OLCV has exclusive rights to develop and operate a carbon sequestration hub on more than 30,000 acres of subsurface pore space controlled by Weyerhaeuser. OLCV will use the land to permanently sequester industrial CO₂ in underground geologic formations not associated with oil and gas production, while Weyerhaeuser continues to manage the aboveground acreage as a working forest.

The lease agreement, with the potential to expand acreage, is a pivotal step in OLCV subsidiary 1PointFive’s plan to build, acquire and operate a series of carbon capture and sequestration hubs around the U.S.

Weyerhaeuser has identified multiple locations for potential carbon capture and sequestration (CCS) projects across a portion of its 7-million-acre footprint in the U.S. South using proprietary geological data covering its lands. Weyerhaeuser, technically a real-estate investment trust, is one of the world’s largest private holders of timberlands. It owns or controls about 11 million acres in the U.S. and manage additional timberlands under long-term licenses in Canada.

Albert sequestration hub

Wolf Midstream, Whitecap Resources, the First Nation Capital Investment Partnership, and Heart Lake First Nation were selected by the Government of Alberta to pursue development of a carbon sequestration hub in the Fort Saskatchewan area, an agreement finalized in March. Wolf and partners will conduct a technical evaluation of the geographic area this year to confirm its suitability prior to applying for a long-term lease from the province.

“Our proposal was anchored in our partnership’s proven CO₂ infrastructure and subsurface capabilities, as well as our plan to use existing infrastructure by connecting to our Alberta Carbon Trunk Line system to minimize the project’s environmental footprint,” said Jeff Pearson, president of carbon operations at Wolf Midstream.

Wolf has agreements with several CO₂ emitters, including large industrial-gases company Air Products, which is building a major net-zero hydrogen-energy complex in the region. Those supply agreements are projected to provide initial CO₂ delivery to the hub of 2 million to 3 million tonnes per annum (mtpa), with ultimate hub volumes that could exceed 6 mtpa.

Wolf is a Calgary, Alberta-based private company backed by Canada Pension Plan Investment Board. Wolf owns and operates CO₂ compression facilities and the 240-km Alberta Carbon Trunk Line (ACTL) pipeline, a multi-party, open access CO₂ pipeline from capture sites to secure underground storage.

“The presence of the ACTL was one of the factors that led us to select Edmonton for our net-zero hydrogen energy complex,” said Seifi Ghasemi, chairman, president, and CEO of Air Products. The ACTL became operational in 2020 and, by the end of 2021 had moved 2 MTPA of third-party CO₂ to permanent storage.

“We expect to have the system in operation by the end of 2024,” said Gordon Salahor, senior advisor for Wolf. “We stress that sequestration by itself is not a project. Supply, capture, transport and sequestration are a project.”

In many ways midstream CCS is little different from traditional hydrocarbon midstream, in that it benefits greatly from economies of scale, Salahor explained. 

“The key exception is at the front end of the pipe; carbon supply and capture usually does not benefit from economies of scale because it is generally so diverse and very source-specific,” Salahor said. “That is why most of the cost in CCS is in capture and the related super-critical liquefaction-compression, rather than in transport and sequestration.”

Transport challenges

One important difference between CCS midstream and hydrocarbon midstream is pressure. 

“You can move CO₂ in vapor phase, but it is ridiculously inefficient, compared to moving it in super-critical phase,” Salahor said. “That is 2,000 psi, the pipe for which is more expensive than the 1,000-psi pipe that is common to the North American hydrocarbon midstream. No one would build 2K pipe for standard oil and gas operations, so the main option for repurposing existing pipe would be to run CO₂ in vapor phase at lower pressure. While you can run short pieces of CO₂ pipe at lower pressure, for gathering perhaps, that is just not economical for any meaningful transport.” 

That means that even for midstream operators with extensive networks of pipe, it is likely that their plans for expansion in CCS will mean lots of new building. That certainly can be along existing rights of way, but even then, there is only limited benefit. 

“If a midstream operator has multi-pipe rights for a right-of-way, that is a great advantage,” Salahor said. “But in most cases the rights agreement will require permission from the landowner to add any new pipe. So, between the permits, rights of way, and 2K pipe, to build CCS midstream you have to go through mostly the whole process.”

Wolf is already involved in CCS and hydrocarbon midstream in both the U.S. and Canada. Its next expansion is the NGL North project due to be in service in 2023. NGL North is a proprietary, integrated NGL recovery, transport, and separation system. By recovering higher carbon NGL from the regional natural gas system, NGL North is intended to reduce CO₂ emissions in the Christina Lake area of Alberta by more than 200,000 mtpa, and will provide feedstock to support the petrochemical industry in the region.

An NGL recovery facility with an ultimate capacity of approximately 1 Bcf/d is being built in Northeast Alberta and send the NGLs to a feedstock separation complex utilizing Wolf’s existing, idle, 16-inch pipeline. The separation complex northwest of Edmonton is next to Wolf’s existing Sturgeon Terminal and Alberta Carbon Trunk Line origin point. The separation complex will produce about 70,000 bbl/d of NGL, including ethane, propane, butane and condensate.

The gas processing unit, pipe connections, and fractionator are all underway. Construction has been paused for the spring breakup, which is common in those latitudes. The frozen ground has softened and takes several weeks to drain and become firm enough for work to resume. Once it has, the company will be resuming work and will have a better line of sight to confirming the target completion date.

Whitecap is a Calgary, Alberta-based public energy company focused on oil and gas production in western Canada. Whitecap operates the Alberta Joffre and Saskatchewan Weyburn CO₂ EOR projects and manages more than 200 CO₂ injection wells, and associated pipelines and infrastructure. Those sequester 2 mtpa. The Weyburn CO₂ EOR project is the largest anthropogenic carbon sequestration project in the world with over 38 metric tons stored to date, according to Whitecap.