Announcing the First Fully Integrated Capture
to Storage CO2 Project at Elk Hills and a New Storage Only CDMA
with NLC Energy
Carbon TerraVault (CTV), a subsidiary of California Resources
Corporation (NYSE: CRC) which provides carbon management services
that include capture, transport and storage of carbon dioxide (CO2)
for its customers, today provided an update on its operations.
“During the third quarter, our team made tremendous progress on
the Carbon TerraVault front by announcing California's first 100
thousand metric tons per year fully integrated capture to storage
project and by bringing the number of emission under CDMAs close to
1 million metric tons per year,” said Francisco Leon, CRC’s
President and Chief Executive Officer. “Our carbon management
strategy reflects our determination to provide solutions for
hard-to-decarbonize industries and new technologies alike.”
Primary Highlights
- Announcing CTV's first capture to storage project at one of the
CRC's gas processing plants, Elk Hills cryogenic gas plant, in Kern
County, California. This new project is expected to begin to remove
and permanently store 100,000 metric tons per annum (MTPA) of CO2
in the CTV I reservoir by year end 2025
- Signed a storage-only Carbon Dioxide Management Agreement
(CDMA) with NLC Energy LLC (NLCE) with a minimum volume commitment
of 150,000 MTPA of CO2 injection at CTV I reservoir.
- CTV’s total projected CO2 injection rate now stands at
1,065,000 MTPA that targets 655,000 MTPA in the San Joaquin Basin
and 410,000 MTPA in the Sacramento basin
- CTV's total submitted storage capacity under permits to the EPA
is at 191 million metric tons (MMT)
- Targeting the receipt of first draft EPA Class VI permit by
year end in California
First Capture to Storage Project at the
CTV Clean Energy Park
Today, CTV announced plans to construct a capture to storage
facility at the CTV Clean Energy Park (formerly Net Zero Industrial
Park) at Elk Hills Field in Kern County, California, that will
remove approximately 100,000 MTPA of associated CO2 from inlet gas
used for Elk Hills Power Plant (EHPP) for permanent sequestration
at the CTV I reservoir.
Located in close proximity to the EHPP, CTV estimates the new
pre-combustion CO2 capture project will increase operational
efficiency of the cryogenic gas processing plant, improve propane
recovery, and reduce the carbon intensity of the electricity
generated by EHPP. This will further reduce CRC's Scope 1 emissions
from EHPP and Scope 2 emissions from the hydrocarbon products
produced from the Elk Hills field.
Highlights of the New Capture to
Storage Project Include:
- The carbon capture equipment will be designed and constructed
to capture 100,000 MTPA of associated CO2 off of CRC's cryogenic
gas processing plant and subsequently sequester the captured CO2 in
the CTV I reservoir
- Estimated capital required to construct the carbon capture
equipment will be in the $10 - $15 million range. This favorable
level of capital investment is due to the Company's full control of
the project's value chain
- The project will use existing amine technology to capture the
CO2 from inlet gas with approximately 95% efficiency
- The project’s location at CTV's Clean Energy Park will
eliminate the need for long haul CO2 transportation and reduce
certain midstream capital requirements
- The capture project is targeting 45Q credit generation as well
as the potential for LCFS qualification, subject to CARB approval,
Cap & Trade (C&T) avoidance and enhanced cryogenic gas
processing plant yields
- CTV anticipates paying CTV JV an injection fee for CO2
sequestration services on a per metric ton basis that fits within
the previously disclosed economic type-curve for projects that
require a storage-only solution
- Project Final Investment Decision (FID) is targeted for first
half of 2024, with injection operations expected to begin in the
second half of 2025
NLC Energy, LLC CDMA
Carbon TerraVault JV HoldCo, LLC (CTV JV) has entered into a
storage only CDMA with NLCE, a company that designs, builds, owns,
and operates renewable natural gas (RNG) facilities that convert
organic waste into useful commodities like clean energy, organic
nutrients, clean water, organic liquid carbon dioxide, and dry ice,
to sequester a minimum of 150,000 MTPA of CO2 at the CTV I
reservoir.
The CDMA expects NLCE will build a new waste to energy
production facility at the CTV Clean Energy Park at Elk Hills. This
new facility is expected to produce up to 7,000 million British
thermal units (MMBtu) per day of RNG from biomass and other
agricultural waste feedstock to provide decarbonized energy to
other companies’ green technology facilities located at the park,
and sell into the California market, further reducing the carbon
intensity of the state’s hard-to-abate sectors.
“This project highlights the value proposition of our CTV Clean
Energy Park and its important role within Carbon TerraVault’s
strategy,” said Francisco Leon, CRC’s President and Chief Executive
Officer. “We welcome NLCE as a trusted partner in developing and
furthering California’s decarbonization efforts and supporting Kern
county’s ambitions to become the leading carbon sequestration area
in the state.”
“Low-carbon, renewable natural gas replaces higher-carbon fuels
that are used in transportation, utilities, and manufacturing,”
said Bruce S. MacDonald, NLCE’s Founder and President. “Our clients
and partners are continuing to make efforts to meet net-zero carbon
emission objectives, and this exciting agreement with CTV opens a
new set of growth opportunities for NLCE in California and helps
decarbonize California’s essential industries.”
Highlights of the NLCE CDMA
Include:
- The facility will be designed and constructed by NLCE to
produce up to 7,000 MMBtu per day of RNG for use by industrial
projects at the CTV Clean Energy Park. A minimum of 150,000 MTPA of
associated CO2 is expected to be permanently sequestered at CTV
I
- Project FID is targeted for late 2024, with operations expected
to begin by 2027
- The CDMA also provides NLCE with a lease for 60 acres at the
CTV Clean Energy Park to construct its facility
- CTV JV will provide in-field transportation and a permanent CO2
sequestration site at CTV I in exchange for an injection fee on a
per metric ton basis that fits within the previously disclosed
economic type-curve for projects that require a storage-only
solution
- The project’s location within the CTV Clean Energy Park will
eliminate the need for long haul CO2 transportation and reduce
certain midstream capital requirements
- CTV JV and NLCE are discussing CRC’s potential financial
participation in the RNG facility
- The CDMA frames the contractual terms between parties by
outlining the material economics and terms of the project and
includes conditions precedent to close. The CDMA provides a path
for the parties to reach final definitive documents and FID
EPA Class VI Permitting
Update
As of September 30, 2023, CRC has submitted 6 Class VI permits
to the EPA for a total projected storage capacity of 191 MMT. CTV
expects the receipt of its first draft EPA Class VI permit for CTV
I 26R reservoir by year end and its second permit for CTV I's A1-A2
reservoir in the first half of 2024.
About Carbon TerraVault
Carbon TerraVault Holdings, LLC (CTV), a subsidiary of CRC,
provides services that include the capture, transport and storage
of carbon dioxide for its customers. CTV is engaged in a series of
CCS projects that inject CO2 captured from industrial sources into
depleted underground reservoirs and permanently store CO2 deep
underground. For more information about CTV, please visit
www.carbonterravault.com.
About Carbon TerraVault Joint
Venture
Carbon TerraVault Joint Venture is a carbon management
partnership focused on carbon capture and sequestration
development, and was formed between Carbon TerraVault, a subsidiary
of CRC, and Brookfield Renewable. The CTV JV develops both
infrastructure and storage assets required for CCS development in
California. CRC owns 51% of the CTV JV with Brookfield Renewable
owning the remaining 49% interest.
About California Resources
Corporation
California Resources Corporation (CRC) is an independent energy
and carbon management company committed to energy transition. CRC
has some of the lowest carbon intensity production in the US and it
is focused on maximizing the value of its land, mineral and
technical resources for decarbonization by developing CCS and other
emissions reducing projects. For more information about CRC, please
visit www.crc.com.
About NLC Energy LLC
NLC Energy (NLCE) is a leading waste-to-energy provider, which
owns and operates renewable natural gas facilities. Methane is
captured and harvested from organic waste to produce energy, as
well as renewably sourced, food-grade dry ice, and beverage-grade
liquid CO2. NLC Energy has the ability to process both manure and
food waste as feedstocks, and has a track record of safe and
reliable production. A seasoned team includes experts in bio
engineering, anaerobic digester technology, and advanced control
systems. This team is committed to creating durable environmental
solutions, and has developed new technologies that are already
shaping the future of renewable natural gas production. To learn
more about NLC Energy, visit www.nlcenergy.com.
Forward-Looking
Statements
This document contains statements that CRC believes to be
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements other than historical facts
are forward-looking statements, and include statements regarding
CRC's future financial position, business strategy, projected
revenues, earnings, costs, capital expenditures and plans and
objectives of management for the future.
Words such as "expect," “could,” “may,” "anticipate," "intend,"
"plan," “ability,” "believe," "seek," "see," "will," "would,"
“estimate,” “forecast,” "target," “guidance,” “outlook,”
“opportunity” or “strategy” or similar expressions are generally
intended to identify forward-looking statements. Such
forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from those
expressed in, or implied by, such statements.
Although CRC believes the expectations and forecasts reflected
in CRC's forward-looking statements are reasonable, they are
inherently subject to numerous risks and uncertainties, most of
which are difficult to predict and many of which are beyond CRC's
control. No assurance can be given that such forward-looking
statements will be correct or achieved or that the assumptions are
accurate or will not change over time. Particular uncertainties
that could cause CRC's actual results to be materially different
than those expressed in CRC's forward-looking statements
include:
- CRC’s ability to finalize definitive documents and reach a
final investment decision with respect to new project contemplated
by their respective CDMAs;
- the ability of new projects to achieve expected production
volumes and associated CO2 generation and the ability of the CTV to
sequester such CO2 volumes, respectively;
- CRC's ability to successfully execute on the construction of
new projects and other aspects of infrastructure projects and enter
into third party contracts on contemplated terms;
- fluctuations in commodity prices and the potential for
sustained low commodity prices;
- equipment, service or labor price inflation or
unavailability;
- legislative or regulatory changes, including those related to
(i) the management of energy, water, land, greenhouse gases (GHGs)
or other emissions, (ii) the protection of health, safety and the
environment, (iii) CRC's ability to claim and utilize tax credits
or other incentives, or (v) the transportation, marketing and sale
of CRC's products and CO2;
- availability or timing of, or conditions imposed on, permits
and approvals necessary for drilling or development activities and
carbon management projects;
- changes in business strategy and CRC's capital plan;
- CRC's ability to realize the benefits contemplated by the
business strategies and initiatives related to energy transition,
including carbon capture and storage projects and other renewable
energy efforts;
- CRC's ability to successfully identify, develop and finance
carbon capture and storage projects and other renewable energy
efforts, including those in connection with the CTV;
- global geopolitical, socio-demographic and economic trends and
technological innovations;
- limitations on CRC's financial flexibility due to existing and
future debt;
- insufficient cash flow to fund CRC's capital plan and other
planned investments, stock repurchases and dividends;
- insufficient capital or lack of liquidity in the capital
markets or inability to attract potential investors;
- limitations on transportation or storage capacity;
- CRC's ability to successfully gather and verify data regarding
emissions, its environmental impacts and other initiatives;
- the compliance of various third parties with CRC's policies and
procedures and legal requirements as well as contracts it enters
into in connection with CRC's climate-related initiatives;
- climate-related conditions and weather events;
- disruptions due to accidents, mechanical failures, power
outages, transportation or storage constraints, natural disasters,
labor difficulties, cyber-attacks or other catastrophic
events;
- pandemics, epidemics, outbreaks, or other public health events,
such as the COVID-19; and
- other factors discussed in Part I, Item 1A – Risk Factors in
CRC's Annual Report on Form 10-K and its other SEC filings
available at www.crc.com.
CRC cautions you not to place undue reliance on forward-looking
statements contained in this document, which speak only as of the
filing date, and CRC undertakes no obligation to update this
information. This document may also contain information from third
party sources. This data may involve a number of assumptions and
limitations, and CRC has not independently verified them and do not
warrant the accuracy or completeness of such third-party
information.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231101970747/en/
Joanna Park (Investor Relations) 818-661-3731
Joanna.Park@crc.com
Richard Venn (Media) 818-661-6014 Richard.Venn@crc.com
California Resources (NYSE:CRC)
Historical Stock Chart
Von Apr 2024 bis Mai 2024
California Resources (NYSE:CRC)
Historical Stock Chart
Von Mai 2023 bis Mai 2024