Fighting Carbon with Carbon: Enhanced Oil Recovery Debate

Fighting Carbon with Carbon: The Enhanced Oil Recovery Debate - Rye Strategy Blog

The 1.5-degree Celsius pathway is the extent to which we must limit global warming to reduce the odds of initiating the most dangerous and irreversible effects of climate change. Many changes and innovations must occur for this goal to turn into a reality – the most notable being carbon collection. The IPCC has noted that all pathways that achieve this goal involve carbon dioxide removal of 100-1000 GtCO2 over the 21st century. The severity of this issue is gaining publicity with the help of some big names such as Elon Musk. He announced a $100 million prize for the best carbon capture technology earlier this year with the goal to inspire carbon negative innovation. Though this is a great feat, experts from around the globe are putting their minds together to navigate around the associated challenges.

What is Enhanced Oil Recovery?

One reason that collecting carbon from the atmosphere has struggled to gain much traction is because the business model is not clear-cut. Sequestering CO2 is costly and if there is no market to sell the collected carbon, there is no incentive. One use for the resource is to pump it into an oil well which causes the oil to become less dense and float to the top, in turn increasing production. This process is called Enhanced Oil Recovery (EOR) and is currently the only carbon sequestration industry of any scale. It may sound counter-intuitive for businesses fighting climate change to partner with the major oil producers, but an argument presents itself for and against this practice.

EOR Pros/Cons

One benefit of injecting the sequestered CO2 underground is that 90 to 95 percent of it stays there and becomes trapped. By nature, it also reduces the need for oil imports because hard-to-recover barrels can be squeezed out through this process.

A downside lies in the fact that EOR qualifies companies for a tax credit titled 45Q. According to CNBC, 9 out of 10 credits given were not in compliance with the EPA. This poses an issue because oil companies are reaping the benefits from this credit without proving or disclosing how much CO2 they really captured. On top of this, EOR adds a new source of revenue for such companies and deepens society’s dependency on non-renewable energy.

Alternatives

Companies in Europe tend to not engage in EOR and have opted to find alternatives to collecting carbon. A less controversial method is Direct Air Capture (DAC) where CO2 is sucked straight out of the atmosphere. One emerging company in the space is Climeworks who operate the world’s first DAC facility. Their machines are powered solely by renewable energy and can permanently remove 90% of the carbon passed through, but similar to others in the space – turning a profit is the biggest challenge.


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About RyeStrategy

Based in Seattle, RyeStrategy is a CDP-accredited, mission-oriented company specialized in carbon accounting, mitigation coaching, and climate disclosure solutions for organizations at any point in their sustainability journey. Learn how RyeStrategy helped Salesforce, Ideascale, and Wazoku achieve their sustainability goals.

From exhaustive carbon footprinting and mitigation coaching, to setting science-based targets and reporting climate data to CDP, SBTi or custom reporting platforms, RyeStrategy acts as a hands-on extension of the team, custom-tailoring services to fulfill climate disclosure requirements easily and accurately.

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Cooper Wechkin

Cooper is a sustainability-focused Seattle native and the founder and CEO of RyeStrategy. While a student at the University of Washington, Cooper found inspiration in businesses that operate at the intersection of positive impact and profit, leading to a personal commitment to pursue a career centered around social impact and mission-driven work. Cooper leads RyeStrategy with a simple goal in mind: to help small businesses do well by doing good. In addition to working directly with small businesses, Cooper partners with sustainability leaders at some of the world's largest organizations, in order to develop highly effective supply chain decarbonization programs. In his spare time, Cooper enjoys hiking, movies, and spending time with his family -- in 2019, he backpacked 270 miles from Manchester to Scotland.

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