exxon ordered to sell co2 in wyoming

Get set.

Exxon ordered to curb venting of CO2 at plant

By The Associated Press

CASPER - The Wyoming Oil and Gas Conservation Commission has ordered Exxon Mobil Corp. to curb carbon dioxide emissions at its Shute Creek natural-gas processing facility near LaBarge and to redirect the greenhouse gas it does produce into pipelines for enhanced oil recovery.

The commission on Tuesday also required Exxon Mobil to submit progress reports detailing the marketing of much of the carbon dioxide it vents.

With the price of oil riding well above $125 per barrel, the state is eager to help out oil producers who desperately want to secure flows of carbon dioxide. The gas can be injected into aging oil fields to sweep out volumes that were unrecoverable through primary or conventional production methods.

Exxon sold an average 207 million cubic feet of the gas per day in 2007 for enhanced oil recovery, but it vented another 181 million cubic feet per day.
According to information provided to the commission by the company, Exxon indicated that it could sell all but 70 million cubic feet per day of the gas.

The commission's order is likely to force the company to get several customer contracts in place for "interruptible" carbon dioxide delivery.

Although Exxon has several customer contracts for delivery to enhanced oil recovery projects in Wyoming and Colorado, those customers cannot always take the full volume of carbon dioxide they have access to under their contracts. The commission wants Exxon to add "interruptible" supply contracts so that no gas is vented that could otherwise help the oil industry.

In addition, the commission ordered Exxon to submit a detailed report justifying why the remaining 70 million cubic feet per day of carbon dioxide cannot be marketed.

Exxon officials have argued that it's too expensive to capture and isolate the entire carbon dioxide inlet stream at Shute Creek. There are costs associated with isolating it from other gases, as well as pressurizing the gas for market deliverability.

"Everything is more complex than it looks," Exxon spokeswoman Sara K. Tays said.

Tays noted that Exxon has committed to investing $70 million to expand production at the Shute Creek gas plant, which includes making an additional 100 million cubic feet per day of carbon dioxide available for the local enhanced oil recovery market.

In addition, Exxon recently announced it would spend more than $100 million to build a "controlled freeze zone" plant at its LaBarge properties. The purpose of the plant is to test technology to make capturing and storing carbon dioxide more affordable.

http://www.billingsgazette.net/articles/2008/06/12/news/wyoming/30-exxon.txt