World pricing for carbon dioxide?

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    World pricing for carbon dioxide?

    For years now, almost all publicity about carbon dioxide pricing in popular news media has focused on speculation about "emission credits," a form of indirect tax actually being implemented in Europe but only a political pastime in the U.S. In the meantime, a business in buying and selling carbon dioxide--the real stuff--has quietly prospered. For many years the fastest growing market has been tertiary oil recovery.

    In the mid-1950s, the former Oil Recovery Corporation (ORCO) of Tulsa, Oklahoma, developed injection of liquefied carbon dioxide as an adjunct to waterflooding of production oil fields--a means of increasing the amounts of oil recovered after primary production began to decline. The ORCO process was disparaged by many petroleum geologists then, who contended any extra oil would be marginal and could never justify the costs.

    Time proved doubters partly right but mostly wrong. ORCO lost its way, financially, because results from the field were erratic--sometimes strong but sometimes nil. The ORCO process generally fails with high-viscosity crudes and can backfire in carbonate-rich sands, plugging rather than opening pores. It works best with low-viscosity crudes in carbonate-lean formations.

    Over the last 40 years, carbon dioxide-enhanced tertiary oil recovery has emerged from a backwater to a mainstream, worldwide business. Indonesian and west Texas oilfields routinely use carbon dioxide for tertiary recovery. In the 1960s, Shell Oil drillers in Mississippi discovered a huge natural carbon dioxide reservoir, produced by an extinct volcano and now called Jackson Dome. It is currently estimated to contain between 150 and 500 million tons of carbon dioxide, now being tapped at about 15 million tons/year to support tertiary oil recovery in Louisiana and Mississippi.

    Jackson Dome and similar carbon dioxide reservoirs in Southwest and Mountain states will be tapped out well before long-term oilfield demand for carbon dioxide is satisfied. Already, some tertiary recovery operations are recapturing part of their injected carbon dioxide and reusing it, so a search is on for new sources. One of them, obviously, is recovery of carbon dioxide from fossil-fired power plants.

    The largest development of that kind so far is the controversial power-plant under construction by Southern Company in Kemper County, Mississippi, about 20 miles north of Meridian. using integrated gasification, combined-cycle technology. Despite the advanced technology, overall Kemper is a relatively low-efficiency plant. However, it will be burning lignite, strip-mined from adjacent land, for which there is hardly any other economic use. [ Southern Company, Kemper County IGCC, National Energy Technology Laboratory, 2011, at http://www.netl.doe.gov/publications/proceedings/11/co2capture/presentations/4-Thursday/25Aug11-%20Nelson-Kemper-Capture%20at%20Kemper%20IGCC.pdf ]

    The 580 MWe Kemper plant will be a chemical factory, producing industrial quantities of sulfuric acid and ammonia and shipping liquefied carbon dioxide by pipeline. The costly project, now about a third finished, is opposed by Sierra Club on environmental grounds, but so far Mississippi Power, a Southern subsidiary, has maintained majority support on the state Public Service Commission. [ Eileen O'Grady, Reuters, Mississippi allows Southern Co. to keep building $2.8 billion coal plant, Chicago Tribune, March 30, 2012, at http://articles.chicagotribune.com/2012-03-30/news/sns-rt-us-utilities-southern-kemperbre82t1cm-20120330_1_coal-plant-power-plant-mississippi-public-service-commission ]

     
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    World pricing for carbon dioxide?

    For years now, almost all publicity about carbon dioxide pricing in popular news media has focused on speculation about "emission credits," a form of indirect tax actually being implemented in Europe but only a political pastime in the U.S. In the meantime, a business in buying and selling carbon dioxide--the real stuff--has quietly prospered. For many years the fastest growing market has been tertiary oil recovery.

    In the mid-1950s, the former Oil Recovery Corporation (ORCO) of Tulsa, Oklahoma, developed injection of liquefied carbon dioxide as an adjunct to waterflooding of production oil fields--a means of increasing the amounts of oil recovered after primary production began to decline. The ORCO process was disparaged by many petroleum geologists then, who contended any extra oil would be marginal and could never justify the costs.

    Time proved doubters partly right but mostly wrong. ORCO lost its way, financially, because results from the field were erratic--sometimes strong but sometimes nil. The ORCO process generally fails with high-viscosity crudes and can backfire in carbonate-rich sands, plugging rather than opening pores. It works best with low-viscosity crudes in carbonate-lean formations.

    Over the last 40 years, carbon dioxide-enhanced tertiary oil recovery has emerged from a backwater to a mainstream, worldwide business. Indonesian and west Texas oilfields routinely use carbon dioxide for tertiary recovery. In the 1960s, Shell Oil drillers in Mississippi discovered a huge natural carbon dioxide reservoir, produced by an extinct volcano and now called Jackson Dome. It is currently estimated to contain between 150 and 500 million tons of carbon dioxide, now being tapped at about 15 million tons/year to support tertiary oil recovery in Louisiana and Mississippi.

    Jackson Dome and similar carbon dioxide reservoirs in Southwest and Mountain states will be tapped out well before long-term oilfield demand for carbon dioxide is satisfied. Already, some tertiary recovery operations are recapturing part of their injected carbon dioxide and reusing it, so a search is on for new sources. One of them, obviously, is recovery of carbon dioxide from fossil-fired power plants.

    The largest development of that kind so far is the controversial power plant under construction by Southern Company in Kemper County, Mississippi, about 20 miles north of Meridian. using integrated gasification, combined-cycle technology. Despite the advanced technology, overall Kemper is a relatively low-efficiency plant. However, it will be burning lignite, strip-mined from adjacent land, for which there is hardly any other economic use. [ Southern Company, Kemper County IGCC, National Energy Technology Laboratory, 2011, at http://www.netl.doe.gov/publications/proceedings/11/co2capture/presentations/4-Thursday/25Aug11-%20Nelson-Kemper-Capture%20at%20Kemper%20IGCC.pdf ]

    The 580 MWe Kemper plant will be a chemical factory, producing industrial quantities of sulfuric acid and ammonia and shipping liquefied carbon dioxide by pipeline. The costly project, now about a third finished, is opposed by Sierra Club on environmental grounds, but so far Mississippi Power, a Southern subsidiary, has maintained majority support on the state Public Service Commission. [ Eileen O'Grady, Reuters, Mississippi allows Southern Co. to keep building $2.8 billion coal plant, Chicago Tribune, March 30, 2012, at http://articles.chicagotribune.com/2012-03-30/news/sns-rt-us-utilities-southern-kemperbre82t1cm-20120330_1_coal-plant-power-plant-mississippi-public-service-commission ]

     
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    Re: World pricing for carbon dioxide?

    Ahh its the old "economic use" arguement. Well grassland has economic value. Even tree and scrub has economic value. Just wild land has economic value. Stripmining coal particularly lignite is of very low value. Compare the price of clean watersheds, or putting a stripmined area back into a clean watershed condition after mining. Lignite is the worst coal. Low energy often sulpher rich. Almost no export market. Thats why they want to burn it close. Cuts the shipping cost.
    On the other side If they build in the price for the ammonia and c02, the cost of really making a sustainable clean watershed over the course of the project.... They most likely would bust the budget. It really is just a variation on mountain top mining where they always have a "need" to fill in somewhere or have a series of massive spoils "ponds". The landscape is gone. Drainages destroyed. Water tables upset. Even if the surface water is undrinkable that same water provides water to the streams and fish. This has economic value particularly with the value of this type of coal falling so hard right now.
     
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    Perils of lignite

    On this one, we'd agree with reader "topaz978." The financials for burning lignite without huge emissions of pollutants are unfavorable. Germany, which has plenty, has shut in most of its former lignite mining and burning. However, watch what happens as the country begins to cope with its planned shutdown of nuclear power. Wind turbines, without some form of very expensive energy storage, can't make up for those losses.

    Southern Co. developed part of the technology for Kemper County, MS, which is also worth a look. The novel element is large-scale IGCC without using an oxygen plant. The key is multiple processes for separating the products of combustion. About two-thirds of the carbon dioxide is supposed to be removed in the last stage with Selexol solvent. That would be of hardly any value were it not for the nearby terminus of a Denbury pipeline that has some surplus capacity and can distribute it as far as Houston.

    Sierra Club emerged from David Brower's disastrous give-away of Glen Canyon with a so-called "national" strategy, which adapts to what the club sees as local opportunities to raise money. In Massachusetts, that currently focuses on truly heart-rending sympathies for the "bottle bill." In Mississippi, the appeal is fighting the Kemper County plant. Sierra Club has been issuing flagrant lies about the plant, using the antique "pounds of pollution" approach now thoroughly discredited here.

    The Kemper County plant is expected to produce exceptionally low pollution--around a tenth of the best conventional technology such as the controversial Turk Power Plant built by an AEP subsidiary in Hempstead County, AR, and less than 5 percent of what Brayton Point emits here, for the same power outputs. The case is so weak that Sierra Club recently migrated to a better justified economics attack on the potential for a big hike in electricity prices, winning in the Mississippi Supreme Court. [ Todd Stauffer, Supreme Court votes 9-0 to send Kemper County coal plant back to PSC, Jackson Free Press, March 15, 2012, at http://www.jacksonfreepress.com/news/2012/mar/15/mississippi-supreme-court-votes-9-0-to-send/ ]

     
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    Re: World pricing for carbon dioxide?

    So You missed the point. How much land and drainage will be destroyed in the process. Lignite mining as a low energy product requires a larger impact for the same output. It is not about the smokestack, rather about the land destroyed by the mining. How do you recreate thousands of acres to plants birds and wildlife when a mountain is pushed off into a natural drainage? Actually this is required but the agency really has a broad brush. It is not a sustainable policy as the clean water will be polluted.
     
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    Land reclamation

    Reader "topaz978" often seems to operate from some knowledge-free pivot and might lack the experience with strip mine reclamation that we have--making it easier to repeat Sierra Club and similar broadsides without a stable point of reference. As a relatively low-value mineral, of course lignite is rarely mined unless surface-accessible, and of course surface mining disturbs landscapes. However, there are examples of good land restoration, when adequate financial resources have been set aside, so the more pertinent question would be whether Mississippi agencies have required enough of Southern Company for that purpose. [ Michael B.E. Bograd, Stan Thieling and David T. Dockery, III, Mine regulation and reclamation in Mississippi, Mississippi Office of Geology, 2012, at http://www.asmr.us/Meetings/2012/Abstracts2/0026-Bograd-MS.pdf ]

    After bad experiences with abandoned and poorly managed strip mine sites since the nineteenth century, the federal government has required minimum standards in the Surface Mining Control and Reclamation Act of 1977. [PL 95-87] Many states, including Mississippi, have additional standards and active monitoring of surface mines and reclamation projects. Recently the Mississippi Department of Environmental Quality approved a mining permit for the Kemper County project, after Sierra Club withdrew its objections. [ Unattributed, Associated Press, Mississippi OKs coal mine to feed Kemper power-plant, Mississippi Business Daily, June 12, 2012, at http://msbusiness.com/2012/06/mississippi-oks-coal-mine-to-feed-kemper-power-plant/ ]

    Near the proposed Kemper County IGCC power-plant, North American Coal has operated the Red Hills lignite mine for over 12 years. It supplies the 514 MWe Red Hills Power Plant, which ships bulk power on contract with TVA. Compared with the IGCC plant proposed by the Mississippi Power subsidiary of Southern, Red Hills is a bad actor--for the same energy output releasing about seven times as much sulfur dioxide plus higher levels of other pollutants except mercury, which appears to be about as well controlled. [ U.S. Environmental Protection Agency, Emissions and Generation Resource Integrated Database, 2012, at http://www.epa.gov/cleanenergy/egrid/index.htm ]

    Based on its experiences with the Red Hills mine, Mississippi DEQ appears to suspect that a lignite surface mine will pollute groundwater and has issued a permit to operate a small part of the proposed mine site for only 4-1/2 years. If groundwater pollution occurs, Southern will have to convert its power-plant for natural gas and abandon a very large investment in IGCC and mining infrastructure. It remains to be seen whether Southern will take the risk. [ Agenda 21, History of Mississippi Power Southern Company lignite plant, Wordpress, 2012, at https://mississippicoal.wordpress.com/tag/kemper-county/ ]

     

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