Federal tax credits are a major part of local efforts to establish carbon capture sequestration operations in Southeast Texas.
However, one major project director stresses the industry’s long-term forecast is not tied to them or any political party’s time in office.
“What does the future of making money with CO2 look like?” Bruce Denyer posed recently. “That’s when you look at those industries that can charge a premium for lower carbon products. We see that significantly. We have potential customers in this region. I’m not going to pretend the tax credits are not a significant component of what we are doing, but if you look at the future, you want to have a business model that is sustainable with the market.”
Denyer is the project director for Bayou Bend, which company leaders say is a joint venture owned by Chevron, TotalEnergies and Equinor to develop a carbon capture and storage facility in Southeast Texas near Port Arthur.
The federal Inflation Reduction Act includes generous tax credits for carbon capture and storage technology. Such incentives may not be part of President Donald Trump’s administrative plans.
Bayou Bend is the first offshore stratigraphic well for carbon capture and storage in U.S. state waters and has the potential to reduce emissions from regional industrial facilities by sequestering carbon dioxide (CO2) safely and permanently underground, according to bayoubend.com.
Denyer spoke about the effort in front of more than 200 business professionals at January’s Contractor Business Development Group meeting at Lamar State College Port Arthur.
The Project
According to Denyer, the local region’s industrial projects include industries that emit CO2 as they operate.
“We take the CO2 and compress that CO2, and then you have, effectively, a dense phase that acts like a liquid,” he said.
Under its proposal, Bayou Bend would take the captured CO2 and reintroduce it into a sequestration hold located approximately 2 miles sub-surface.
As a frame of reference, Denyer said a 1,700-square-foot house with ten-foot ceilings could hold a ton of CO2 in its gassiest phase.
“If you compress that to a supercritical state set to a liquid, which is how we transfer that through the pipeline, that fits in the oven in the corner of the house,” according to Denyer.
Bayou Bend currently boasts the first offshore Texas Class VI permit, with one well offshore and one well onshore available for assessment.
Southeast Texas has a large concentration of CO2 emitters, the ideal geology prerequisites for CO2 storage, and an accomplished number of long-serving expert teams in developing and delivering projects. Leveraging that skillset could set the stage for a U.S.-leading effort in carbon reductions.
“The world needs affordable ever greener energy, effectively lower carbon-intensity energy,” Denyer said. “That’s how we remain competitive in the market. That is where the world is going. That is the expectation if you want to be leading the world in products and services in this space. The market demand for lower CO2 products really drives the market we see right now.
“We need all of the companies and all of the technologies to move this forward.”
Bayou Bend leaders say a successful project enables new projects and existing producers to reduce their CO2 levels and maintain competitiveness. It also maintains and expands the existing market.
Local companies looking to serve as suppliers to Bayou Bend can email supplychain@bayoubend.com.
