Continental Resources invests in CCS project: Update
Adds interview starting in eighth paragraph.
US oil and gas producer Continental Resources is investing $250mn in a project to pipe CO2 to North Dakota where it will be permanently buried underground.
Summit Carbon Solutions is aiming to capture the CO2 from ethanol plants and other industrial sources in Iowa, Nebraska, Minnesota, North Dakota and South Dakota. The CO2 will be then be transported to North Dakota via a 680-mile (1,094km) pipeline, where it will be stored in subsurface geologic formations.
The strategic investment in Summit from Continental Resources over the next two years will help fund the development and construction of the project's associated capture, transportation and sequestration infrastructure.
The carbon capture and sequestration (CCS) project has commitments from 31 ethanol facilities to deliver more than 8mn metric tons (t) a year of CO2, with an initial pipeline capacity of 12mn t/yr.
Cutting the carbon footprint of ethanol production in half will give the plants access to new markets that have implemented low-carbon fuel standards, according to Summit. Last month, the company filed a pipeline permit application in Iowa, where the bulk of the committed ethanol facilities are located.
"Carbon capture will play an integral role in helping reduce global emissions, and we believe Summit Carbon Solutions has the most capital-efficient project to further this goal," Continental Resources chief executive Bill Berry said.
Continental will use its geologic expertise to ensure the safe and secure storage of CO2. The first interstate CCS project in the US has an estimated start-up date of first half 2024.
Carbon capture from ethanol is one of the lowest-cost options available, Berry said in an interview.
"This was something that we looked at quite a while back saying, 'Is this a type of project that we would see as the right thing to do?'" Berry said. "And we said, 'Yes.'"
Although the project has already met with some opposition from local landowners, Bruce Rastetter, who heads parent company Summit Agricultural Group, is optimistic this could be overcome.
"It's actually really beneficial to the farmer in terms of the easement reflecting today's land value," he said.
Continental has long operated in the Bakken shale of North Dakota, but recently took a major step into the Permian basin in Texas and New Mexico with its $3.25bn purchase of assets from Pioneer Natural Resources.
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FTC flexes muscles over US oil mergers
FTC flexes muscles over US oil mergers
New York, 13 May (Argus) — US antitrust regulator the Federal Trade Commission's insistence that the former chief executive of independent Pioneer Natural Resources, Scott Sheffield, be barred from ExxonMobil's board as a condition of approving their $64.5bn merger serves as a cautionary tale for other pending deals. The FTC alleged that Sheffield, a long-time industry leader who made Pioneer one of the biggest producers in the Permian, sought to collude with Opec. It cited hundreds of text messages in which he discussed pricing and output with officials from the oil cartel, as well as efforts to co-ordinate with other Texas producers. The fallout for other transactions still going through the approvals process may be limited, given the specific nature of the allegations against Sheffield, but the FTC's action shows the agency will not hesitate to demand concessions in order to wave deals through. Given heightened political sensitivities to fuel prices in an election year, that should put the industry on notice. At the very least, future reviews are likely to include requests to turn over any records — electronic or otherwise — that involve discussions with competitors or other oil-producing jurisdictions, according to former FTC chairman Bill Kovacic. "It's a reminder that conversations with your competitors about production levels and pricing levels are exceedingly unwise," Kovacic says. It was significant that the FTC did not tamper with the basic fundamentals of the Pioneer acquisition. "I suspect the former CEO is unhappy about being placed on the sidelines," he says. But it is also a "relatively inexpensive price to pay for getting this done". Under the leadership of Lina Khan, the FTC has taken a tougher line when it comes to mergers, and second requests for information have become the norm when it comes to oil deals. Chevron's planned $53bn acquisition of US independent Hess has been held up by such a request, even as a dispute over the target company's stake in a giant offshore find in Guyana has cast a cloud over the transaction. Diamondback Energy's announced $26bn takeover of Endeavor Energy Resources was also subject to a second request. Occidental Petroleum chief executive Vicki Hollub told analysts in February that "some of our teams felt like [the FTC] asked for everything" when going through the approval process for the company's $12bn purchase of CrownRock. But Occidental said this week that its teams are working "constructively" with the regulator, and that the deal is expected to close in the third quarter. Consolidation over consumers? The rapid pace of consolidation in the US oil and gas sector since late last year has led to mounting calls for increased scrutiny on antitrust grounds. "Let's not kid ourselves, these mergers aren't just about efficiency or lowering costs," US Senate Democratic majority leader Chuck Schumer wrote in a letter signed by 50 Senate and House Democrats in March. They are about "buying out the competition so the newly consolidated industry can boost profits at the expense of consumers". Given long-serving company executives' preference to stick around after selling their firms, the FTC's action in relation to Pioneer could theoretically dissuade other ‘big-name' founders from going down the same road, consultancy Rystad senior analyst Matthew Bernstein says. On the other hand, the loss of control for family-owned operators has already served as a big enough obstacle for some companies that would otherwise be seen as takeover targets. As for Sheffield, Pioneer has said the FTC's complaint reflects a "fundamental misunderstanding" of US and global oil markets and "misreads the nature and intent" of his actions. Pioneer more than doubled its daily production between 2019 and 2023, playing its part in adding to domestic energy supply, the firm said. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Japan’s Daio Paper to explore biorefinery
Japan’s Daio Paper to explore biorefinery
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China, US pledge joint methane action at climate talks
China, US pledge joint methane action at climate talks
San Francisco, 13 May (Argus) — The US and China have pledged to further co-operate on methane reduction, among other topics, following a first meeting between the countries' new climate envoys in Washington during 8-9 May. The meeting follows video conferencing between the two sides in January under their "working group on enhancing climate action in the 2020s" initiative. China and the US reaffirmed their 2021 agreement to co-operate on reducing carbon emissions in the power generation sector, cutting methane emissions and boosting renewable energy in the " Sunnylands Statement on Enhancing Cooperation to Address the Climate Crisis " last November in San Francisco. China confirmed the appointment of Liu Zhenmin to replace Xie Zhenhua as the country's climate advsior in January. Liu's US counterpart John Podesta replaced John Kerry in January. Liu and Podesta discussed co-operation "on multilateral issues related to promoting a successful COP 29 in Baku, Azerbaijan" at the latest talks, the US state department said on 10 May. They also discussed issues identified in the Sunnylands statement, including energy transition, methane and other non-CO2 greenhouse gases, the circular economy and resource efficiency, deforestation,as well as low-carbon and sustainable provinces, states and cities. They plan to co-host a second event on reducing methane and other non-CO2 greenhouse gases in Baku and "conduct capacity building on deploying abatement technologies". It remains to be seen how the two new climate advisors will bring the two countries closer in climate negotiations. The Sunnylands statement and the close relationship of their predecessors were instrumental in bringing consensus at last year's Cop 28 UN climate summit in Dubai. China released a much anticipated methane plan last November, although Xie has flagged challenges with data monitoring in the sector. But China and the US have agreed to develop and improve monitoring to "achieve significant methane emissions control and reductions in the 2020s". China has also not signed on to the Global Methane Pledge to cut methane emissions by 30pc by 2030, from 2020 levels. The country's emissions may also rise more than expected after it redefined its meaning of energy intensity, according to the Helsinki-based Centre for Research on Energy and Clean Air. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Argus launches US low-carbon methanol pricing
Argus launches US low-carbon methanol pricing
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