Denbury Executes Term Sheet with Mitsubishi Corporation for CO2 Transport and Storage from Ammonia Project
21 September 2021 - 12:30PM
Business Wire
Denbury Inc. (NYSE: DEN) (“Denbury”) today announced that its
wholly-owned subsidiary, Denbury Carbon Solutions, LLC., and
Mitsubishi Corporation (“Mitsubishi”) have executed a term sheet
for the transport and storage of CO2 captured from Mitsubishi’s
proposed ammonia project on the Gulf Coast of the United States.
The agreement between Denbury and Mitsubishi underscores the
parties’ shared interest in pursuing energy opportunities and
contributing towards a low-carbon society, with Mitsubishi focused
on the production of fuel ammonia and Denbury pursuing its mission
of providing world-leading carbon transportation and storage
solutions.
Mitsubishi aims to introduce its fuel ammonia to the Japanese
market, with production commencing from its Gulf Coast facility in
the latter half of the decade. The project is targeted to produce
an ammonia volume of around 1 million metric tons per annum (mmtpa)
with associated CO2 emissions of around 1.8 mmtpa and the potential
for additional ammonia projects to follow.
Key highlights of Denbury’s term sheet with Mitsubishi
include:
- Denbury will transport and sequester all of the CO2 captured at
Mitsubishi’s ammonia facilities.
- The captured CO2 may be utilized by Denbury in its enhanced oil
recovery operations or, alternatively, for storage in other
geologic sequestrations sites.
- The term sheet contemplates an initial period of 20 years, with
the ability to extend further. Total volumes under the arrangement
could surpass 50 million metric tons of CO2.
- Mitsubishi’s ammonia facilities are planned for construction in
close proximity to Denbury’s CO2 Green Pipeline system.
Chris Kendall, Denbury’s President and Chief Executive Officer,
commented, “Today’s announcement with Mitsubishi highlights
Denbury’s position as the preferred business partner for
transporting and storing captured industrial CO2 emissions. We are
excited to deliver the first of what we believe will be many CO2
transport and storage deals with industrial customers along our
extensive infrastructure footprint. We look forward to working with
Mitsubishi on this project, which represents a significant step in
the creation of substantial value through our Carbon Solutions
business.”
ABOUT DENBURY Denbury is an independent energy company
with operations and assets focused on Carbon Capture, Use and
Storage (CCUS) and Enhanced Oil Recovery (EOR) in the Gulf Coast
and Rocky Mountain regions. For over two decades, the Company has
maintained a unique strategic focus on utilizing CO2 in its EOR
operations and since 2013 has been active in CCUS through the
injection of captured industrial-sourced CO2. The Company currently
injects over three million tons of captured industrial-sourced CO2
annually, and its objective is to fully offset its Scope 1, 2, and
3 CO2 emissions within this decade, primarily through increasing
the amount of captured industrial-sourced CO2 used in its
operations. For more information about Denbury, visit
www.denbury.com.
The Denbury Carbon Solutions team was formed in January 2020 to
advance Denbury’s leadership in the anticipated high-growth CCUS
industry, leveraging its unique capabilities and assets that were
developed over the last 20-plus years through its focus on CO2
EOR.
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ABOUT MITSUBISHI Mitsubishi Corporation is a global
integrated business enterprise that develops and operates
businesses across virtually every industry including natural gas,
industrial materials, petroleum & chemicals solution, mineral
resources, industrial infrastructure, automotive & mobility,
food industry, consumer industry, power solution and urban
development. For more information about Mitsubishi, visit
https://www.mitsubishicorp.com/jp/en/.
This press release contains forward-looking statements that
involve risks and uncertainties, including Denbury and Mitsubishi
negotiating and executing definitive agreements documenting the
anticipated arrangements discussed above, the construction of the
ammonia plant, connecting CO2 pipeline and sequestration facilities
and their becoming operational, and the estimated levels of CO2
emissions being available for sequestration. These statements are
based on engineering, geological, financial and operating
assumptions that management of both parties believe are reasonable
based on currently available information; however, their
achievement are subject to a wide range of business risks, and
there is no assurance that these goals and projections can or will
be met. Actual results may vary materially. In addition, any
forward-looking statements represent the parties’ estimates only as
of today and should not be relied upon as representing its
estimates as of any future date. The parties assume no obligation
to update these forward-looking statements.
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version on businesswire.com: https://www.businesswire.com/news/home/20210921005260/en/
DENBURY CONTACTS: Brad Whitmarsh, Executive Director,
Investor Relations, 972.673.2020, brad.whitmarsh@denbury.com Susan
James, Manager, Investor Relations, 972.673.2593,
susan.james@denbury.com
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