McElmo Dome

From Global Energy Monitor
This article is part of the Global Fossil Infrastructure Tracker, a project of Global Energy Monitor.
Sub-articles:
McElmo Dome in Colorado. Credit: Purdue University

McElmo Dome is a natural carbon source field that is 98% pure.[1] located in southwestern Colorado, operated primarily by Kinder Morgan Energy Partners. It is the most prolific of the Natural CO2 Source Fields in the world.[2]

The carbon produced there is crucial for oil drilling as an injectant for CO2 enhanced oil recovery in Texas' Permian Basin, the global epicenter of CO2 EOR for Carbon Capture Utilization and Storage (CCUS). It is one of the five major producing Natural CO2 Source Fields in the United States and is 203,000 acres in size.[3]

McElmo Dome carbon is sent via the 500-mile Cortez Pipeline to Texas' Permian Basin in which the produced carbon is injected under the ground to free up an additional 8-20% of oil. CO2 EOR is also sometimes called "carbon flooding" or "tertiary recovery."[4]

Natural carbon dioxide is currently the source of over 80% of the CO2 for CO2 EOR in the United States[5]and CO2 EOR currently is the final carbon sink for nine of the ten biggest U.S.-based Carbon Capture and Storage (CCS) projects currently commercially operational.[6] Traditionally known as CCS, CO2 EOR is a central component of a rebranding effort which began in 2012 known as CCUS, or carbon capture utilization and storage. The "U" in CCUS, in this case, is using carbon to drill for more oil.[7]

According to a 2014 U.S. Department of Energy study, 97% of the industrial marketed carbon is used for CO2 EOR.[8]

A 2020 academic study concluded that CO2 enhanced oil recovery using CO2 source fields like the Jackson Dome, McElmo Dome, Bravo Dome, Sheep Mountain, and Doe Canyon “cannot contribute to reductions in anthropogenic CO2 emissions into the atmosphere.”[9] A study the year before, published by the U.S. Department of Energy echoed that conclusion, writing that CO2 production for CO2 EOR "does not contribute towards a net reduction in CO2 emissions to the atmosphere."[10]

Multiple studies have also called into question the climate benefits of CO2 EOR production even with anthropogenic carbon, pointing to the process as a net-positive greenhouse gas emitting process.[11]

Location

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Field Details

Comparison to Oil, Gas Drilling

An industry engineer told the outlet Capital & Main that CO2 drilling is akin to drilling for oil and gas, at its core.

“It’s really the same tools, the same equipment, the same calculation going on. It’s just using different types of numbers,” the engineer stated. “But you find a CO2 source field, which obviously can be several thousand feet underground, and you move a drilling rig in and you drill for it.”[14]

History/Background

CO2 production became commercial at the Bravo Dome for Shell Oil's CO2 unit in 1983 after the finalization of the joint pooling agreement among landowners[15] and the building of the Cortez Pipeline, which signed a contract in 1982 to ship oil to the Denver Unit CO2 EOR field in Denver City, Texas.[16] Cortez Pipeline, when created, was a joint venture between Continental Resources, Shell, and Mobil.[17] In 1980, the U.S. Bureau of Land Management approved a right-of-way for 100 miles of public lands for what would become the Cortez Pipeline.[18]

Landowners had initially disputed the terms of royalties for the CO2 field, but the legal claim was denied by the U.S. Bureau of Land Management, which acts as steward for a large portion of the field's land.[19] The initial pipeline workers for the Cortez Pipeline lived in Rowell, New Mexico, better known as a site at which some have claimed to see unidentified flying objects (UFOs).[20]

Texas state court records from 1998 show that from 1984-1997, Shell allegedly wrote off transportation and other related expenses via the Cortez Pipeline as deductions, thus reducing the pool of money paid to royalty owners. This is despite saying royalty owners would not foot the bill for these expenses in materials distributed to them. [21][22]

In 2000, Kinder Morgan Energy Partners purchased an outstanding 80% stake in Shell CO2 in 2000 for $185 million and became the predominant producer at the McElmo Dome.[23]

The company expanded its footprint in the field in 2014 with a $671 million expenditure, part of a $1 billion spend to expand CO2 drilling at-large for the company. [24] A chunk of that plan, however, fell by the wayside when the Lobos Pipeline, slated to carry CO2 from the St. John's Dome in eastern Arizona to the Permian Basin's CO2 EOR fields, received grassroots opposition and Kinder Morgan cited economic reasons for putting the project on hold.

Monument Status Exemption

The same year as Kinder Morgan became the predominant CO2 producer at the McElmo Dome, Canyons of the Ancients became a National Monument designated by the U.S. Department of Interior and declared such by President Bill Clinton,[25] and the Clinton Administration exempted the production area from monument-status protection and preservation.[26][27]

Both the George W. Bush Administration and the Obama Administration authorized permits to expand Kinder Morgan's CO2 drilling access within monument land.[28] The Obama Administration did not address climate change in granting the permit to expand CO2 drilling in the area,[29] while the Bush Administration addressed it by downplaying the concerns.

The CO2 marketing is "completed in a closed system much the same as CO2 extracted from a power plant’s emissions," wrote the Bush Administration in a 2002 regulatory determination approving four additional wells in Canyons of the Ancients. [30]

No Accounting for Greenhouse Gas Emissions

Natural CO2 Source Fields disclose their production levels under Subpart PP of the U.S. Environmental Protection Agency (EPA)'s Greenhouse Gas Reporting Rule, which is a self-reporting mechanism. As a CO2 producer under that subpart, the company must only report its production levels and not its emissions under the statute.

The operative language of Subpart PP of the Mandatory Greenhouse Gas Reporting statute reads, "The owner or operator of a CO2 production well facility must maintain quarterly records of the mass flow or volumetric flow of the extracted or transferred CO2 stream and concentration and density if volumetric flow meters are used."[31]

CO2 enhanced oil recovery wells, a key component of Carbon Capture Utilization and Storage, also must report emissions generated via the production activity under the Greenhouse Gas Reporting Rule via Subpart UU of the Mandatory Greenhouse Gas Reporting statute."[32]

Outside of greenhouse gas emissions, the compressor station for the McElmo Dome -- Yellow Jacket -- produces high levels of co-pollutants. They include SO2, NOx, VOCs, carbon monoxide, PM 2.5, PM 10, and Benzene.[33] Multiple infrared camera videos taken by the group Earthworks shows high levels of air pollution emanating from the Yellow Jacket Compressor Station in both 2016[34] and 2017.[35]

“This is probably separating and burning off waste gases coming from the ground that are not commercially valuable and/or cannot be put in the CO2 pipeline,” Pete Dronkers, an organizer with the group, told Global Energy Monitor. “The compressor...requires multiple engines -- several thousands of horsepower each -- which compress and push the CO2 towards Texas.”

Dronkers added that the “engines also emit significantly.”

CO2 EOR Climate Impacts

Multiple studies have pointed to the climate change impacts of beefing up CO2 enhanced oil recovery. They come with the backdrop of a 2019 U.S. Department of Energy report concluding that there has been "no official mechanism for reporting leaks" of CO2 for most of the history of CO2 EOR production. "In addition, little information is available on project post-closure status and CO2 behavior in the subsurface post-injection," the report continues.[36]

A 2019 study published in the journal Applied Energy concludes that "from [a] thermodynamics point of view, CO2 enhanced oil recovery (EOR) with CCS option is not sustainable, i.e., during the life cycle of the process more energy is consumed than the energy produced from oil."[37]

A decade earlier, another study came to the same conclusion: CO2 EOR is a carbon-positive emissions drilling process. That paper, published by researchers at Carnegie Mellon University in the journal Environmental Science & Technology, surmised that “without displacement of a carbon intensive energy source, CO2-EOR systems will result in net carbon emissions.”

"We calculated that between 3.7 and 4.7 metric tons of CO2 are emitted for every metric ton of CO2 injected. The fields currently inject and sequester less than 0.2 metric tons of CO2 per bbl of oil produced," the researchers further detailed. "In order to entirely offset system emissions, e.g., making the net CO2 emissions zero, 0.62 metric tons of CO2 would need to be injected and permanently sequestered for every bbl of oil produced. The only way to sequester this amount of CO2 would be to operate a sequestration project concurrently with the CO2-EOR project."[38]

In 2020, researchers June Sekera and Andreas Lichtenberger came to similar summations in doing a survey of over 200 studies done on Carbon Capture Utilization and Storage to date with regards to greenhouse gas emissions in their paper titled, "Assessing Carbon Capture: Public Policy, Science, and Societal Need: A Review of the Literature on Industrial Carbon Removal."

"We found that papers that deem CCS-EOR to be a climate mitigation technique either fail to account for all emissions (i.e., they perform only a partial life cycle analysis) and/or they make an assumption that CCS-EOR-produced oil 'displaces' conventionally produced fossil fuel energy," they wrote, surmising instead that "data show that the process actually results in net emissions."[39]

U.S. Environmental Protection Agency data further shows that at the CO2 treatment facilities servicing some of the major CO2 EOR fields at Texas' Permian Basin, the facilities emit high levels of carbon dioxide and other copollutants into the atmosphere.

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One of them, the SACROC CO2 treatment facility servicing the SACROC CO2 EOR field -- operated by Kinder Morgan Energy Partners -- emitted 425,971.5 metric tons of CO2 into the atmosphere in 2019.[40] That amounts to 92,640 passenger vehicles driven for a year and 77,375 homes' electricity use for one year, according to the EPA's Greenhouse Gas Equivalencies Calculator.[41] The SACROC facility also emits high levels of PM 10, VOCs, ammonia, PM 2.5, carbon monoxide, formaldehyde, methane, NOx, and sulfur dioxide, according to EPA pollution data.[42]

The Denver Unit and Wasson CO2 removal plans, both of which service the Denver Unit CO2 EOR field, also emitted a total of 153,035.7 metric tons of CO2 into the atmosphere in 2019. [43][44] That equates to 33,282 passenger vehicles driven for one year and 27,798 homes' electricity use for one year.[45]

Occidental's Denver City CO2 removal plant in Denver City, Texas. Credit: Google Maps.

The Denver Unit CO2 removal plant also emits high levels of sulfur dioxide, nitrogen oxides, carbon monoxide, as well as PM 2.5 and PM 10, according to the EPA Air Pollutant Report for the facility.[46] The separation facility is located within three miles of over 5,100 people, 66% of whom are people of color and over 75% of whom have a family income of below $75,000 per year. Only just above 15% of the population in that 3-mile radius has a college degree and 63% of the population in that radius has a Latinx ethnic origin.[47][48]

Denver City CO2 removal plant next to oil rigs. Photo Credit: Google Maps

According to Texas Center on Environmental Quality data, the Wasson CO2 Removal Plant owned by Occidental also emitted 19,312 pounds of carbon monoxide via designated illegal air pollution incidents into the atmosphere between January 1, 2020 and February 24, 2021. The facility also emitted over 3,400 pounds of H2S; over 15,700 pounds of non-methane, non-ethane natural gas; over 2,250 pounds of oxides of nitrogen; and over 314,000 pounds of sulfur dioxide[49]

Between January 2020 and March 14, 2021, Occidental's Anton CO2 dehydration plant in Shallowater, Texas had 11,800 pounds of carbon monoxide incidents, 637 pounds of H2S; over 9,200 pounds of non-methane, non-ethane natural gas; and over 56,300 pounds of SO2, and 1,672 pounds of NOx.[50]

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And between June 2020 through January 2021, the company's Denver Unit CO2 Recovery Plant had incident events which emitted over 40,400 pounds of carbon monoxide into the atmosphere, more than 65 pounds of H2S, over 23,200 pounds of non-methane/non-ethane natural gas, over 5,000 pounds of NOx, and over 6,000 pounds of SO2.[51]

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Three of the company's CO2 processing plants sit within the top ten most polluting facilities in Texas when ranked by SO2 emissions, according to a 2020 report by the group Environment Texas, when ranked by illegal air pollution events. They include the West Seminole San Andres Unit CO2 facilities, the Seminole Gas Processing Plant, and the Willard CO2 Separation Plant. But when measuring all co-pollutants, five of the top six polluters in the TCEQ's Region 2 (Lubbock) are CO2 separation/removal/recovery plants.[52]

Top 10 polluters for TCEQ Region 2. Credit: Environment Texas
Willard CO2 Plant in Denver City, Texas. Credit: Google Maps

The main Permian-area gas plants which create carbon as a by-product, thusly used for CO2 EOR production, are also highly polluting, according to U.S. Environmental Protection Agency (EPA) data.

The Pikes Peak Gas Plant -- located in Fort Stockton, Texas and operated by Occidental -- is in the 87.8 percentile for PM 2.5 emitted into the atmosphere, 92.7 percentile for ozone, 86.1 for other air toxics, and on the 83.9 percentile for respiratory hazard index.[53] The plant also emits high levels of benzene, formaldehyde, toluene, carbon monoxide, ethylbenzene, xylene, VOCs, hexane and climate change-causing CO2 into the atmosphere, according to other EPA data.[54]

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The Terrell Gas Plant in Sheffield, Texas shows similar attributes, sitting in the 68.9 percentile for PM 2.5, 70.3 for ozone, 67.8 for air toxics cancer risk, and 66.7 for respiratory hazard index.[55] Like Pikes Peak, the plant is operated by Occidental. The facility also emits high levels of VOCs, formaldehyde, CO2, methane, toluene, acetaldehyde, benzene, carbon monoxide, PM 2.5, acrolein, SO2, hexane, methanol, and NOx into the atmosphere.[56] Greenhouse gas emissions data from the EPA shows that the facility emitted 50,011 metric tons of CO2 into the atmosphere in 2019. [57]

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Beyond Texas, at Denbury's Bogue Chitto, Mississippi's CO2 EOR site, the company emits high levels of nitrogen oxides (NOx), hexane, carbon monoxide, VOCs, benzene, formaldehyde, and PM 2.5, according to U.S. Environmental Protection Agency data.[58]

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Community Impacts

The communities located near the McElmo Dome and Doe Canyon have documented many complaints against Kinder Morgan Energy Partners and Occidental. Those include noise complaints about the Yellow Jacket Compressor Station and growth of community CO2 assets,[59][60] local road damage, grievances about power lines on agricultural properties,[61] and the sensing of foul-smelling odors which have led to public health impacts.

Yellow Jacket Compressor Station shown in presentation given by Kinder Morgan Energy Partners in 2014 presentation. Credit: Montezuma County Board of Commissioners

“I woke up with a headache, and could hear a constant roar from a well a mile away,” one resident said of public health concerns to a local media outlet. “Gas poured into our ravine, and my 90-year old mother-in-law breathed it in.”[62]

“I can hear it all day and all night right now,” another resident told the same local media outlet. “If you could make the noise go away, that would be nice.”[63]

“There’s no peace of mind when you go out to have a cup of coffee in the morning,” another source told a local independent media outlet. “The noise is 24/7. They shut that plant down maybe three times a year.” The source added that once the compressor station arrived nearby, "our house started vibrating."

Others told that outlet that once the compressor opened for business, they began "experiencing headaches, nose bleeds and sore throats."[64]

Residents have also filed complaints with the state about those issues.

"I often smell an 'industrial gas' smell around this county. It's new in the last 3 yrs," reads one of those complaints, filed with the Colorado Oil and Gas Conservation Commission about the Cow Canyon Compressor Station in the McElmo Dome. "Alot (sic) of people seem to be experiencing sinus conditions that last several wks. at a time and or get sick in the summer. There's a constant greenish/brown haze on the southern and western horizons, when the wind's not blowing."[65]

Another resident said that same compressor station often sounds "like a jet engine."

"Then 4 seconds of silence. Repeat. I could see a white plume coming from 2 stacks, going at least as high as the stacks are high," reads that complaint. "What was being vented? Did they even report this? Kinder Morgan has a reputation for releasing all sorts of gas into the air... sometimes really nasty gas. Any release concerns me."[66]

That complainant, Gala Pock, was several years earlier booted from the Montezuma County Planning and Zoning Board for disputing CO2 pipeline permits and speaking out against the company. After telling a company representative to "Go to hell" at a Board meeting, during debate over a pipeline, Pock received a letter telling her she had been removed from the Board.[67]

Kinder Morgan also said at a county Board of Commissioners meeting in 2014, of requested duties to pay $1.5 million for local roads by Montezuma County residents who said its trucks had destroyed, that “We're here to make money" and paying for such roads would hinder those ambitions. "We've paid enough. We're being treated unfairly," the company's regulatory manager stated.[68]

The company also filed a lawsuit[69] against the county for its request to build powerlines underground, instead of above ground,[70] which farmers said would drop the value of their land in the area.[71] Kinder Morgan would eventually drop the lawsuit.[72]

In 2014, a local farmer said of this debate over where to lay the powerline that “The area is becoming a chokepoint for pipelines, powerlines, and irrigation...Commercial agriculture here is a huge part of the economy. My fear is that agriculture will die from 1,000 cuts.”[73]

Supreme Court Tax Case

Kinder Morgan underpaid taxes by $2 million,[74] according to a 2017 Colorado Supreme Court ruling,[75] the culmination of years of disputes[76] between the county and company over taxation policy.[77][78] In actuality, the county's Asssssor at the time said the company had undervalued its CO2 production by about $50 million.[79]

The state also has a 5% severance tax on CO2 production, per a 1982 Colorado Supreme Court ruling.[80]

Local Economic Dependence

As of 2020, Montezuma County gets over half of its tax revenue from CO2 drilling, according to Assessor's Office data.[81] Dolores County, Colorado, home of the Doe Canyon CO2 source field extension of the McElmo Dome also operated by Kinder Morgan, raises 64% of its tax revenue from its carbon field.

State Violations

Kinder Morgan has racked up environmental violations at the McElmo Dome.

In 2011, the company received $140,000 for 73 different environmental violations, which the Colorado Oil and Gas Conservation Commission said was actually a lowered down amount from the over $700,000 worth of violations the company had committed.[82] Kinder Morgan was given mercy on the fine amount "because the company volunteered so much information and took steps to make sure it doesn't happen again," The Durango Herald reported at the time.[83]

In 2013, the company received another $220,000 in fines and the Colorado Oil and Gas Conservation Commission noted at the time that the company was amassing a "pattern of rulebreaking."[84] That same year, the agency doled out four more notice of violations to Kinder Morgan for running afoul of the law on things ranging "from inadequate storage of drill cuttings to drill pad sizes that exceeded their permitted area."[85]

The problems ranged from paperwork violations to spills and improper storage of drilling waste," reported The Cortez Journal. "Kinder Morgan failed to notify the state in writing at least two days before building a drilling waste pit, and its well sites disturbed more land than the permit allowed. The company also stored drill cuttings on a liner, which overflowed with rainwater and flowed onto the soil."[86]

Then in 2019, the Colorado Oil and Gas Conservation Commission ordered a shutdown of one of its CO2 wells due to a complaint from a Montezuma County resident who lived nearby it. “It's unnerving when you smell gas and the alarm is not functioning,” said the resident. “Living next to a well is not very relaxing. There is a certain amount of fear about the unknown gases coming out of there.”[87]

Local Revolving Door

Bob Clayton, who formerly served as the production supervisor for Kinder Morgan in Montezuma County at the McElmo Dome,[88] left that job and proceeded to join the County Board of Commissioners. It is a position Clayton began in 2014.[89]

Sequestering vs. Recycling

During the CO2 EOR process, CO2 is not merely stored underground immediately. Instead, it is recycled as part of what the Global CCS Institute describes as a "closed loop," which "reduces the need to purchase additional CO2."[90]

A closed-loop CO2 EOR system, exhibited in a 2013 NETL report.

A 1976 study commissioned by the Federal Energy Administration pointed out that, from the onset, CO2 EOR would not be economically feasible for the oil industry without recycling technology. The study explained the industry will necessitate "major improvements in...recycling...before the full potential of this recovery tech­nique can be realized."[91]

As early as 1981, a petroleum engineering coordinator for Shell told colleagues at the Society for Petroleum Engineers that CO2 for CO2 enhanced oil recovery should be recycled because it "is a very valuable commodity" and "it does involve large amounts for oil recovery."[92]

In 1991, a production supervisor at Shell at the Jackson Dome further explained, "We're recycling everything we produce. Eventually the flood will be mature enough that all we'll be doing is recycling. We won't have to bring any more down from Jackson Dome."[93]

In 2016, the U.S. Department of Interior's Office of Natural Resources Revenue also explained the CO2 EOR process as one centering around recycling in a legal ruling pertaining to disputes over royalty payments at the Bravo Dome. "At the surface, the CO2 is separated from the oil," explains the filing. "The oil is sold and the CO2 reused again in the EOR reservoir. This means the CO2 is part of a continual process and is not sold."[94]

In a 2018 presentation, Denbury further concluded that by 15 years into a CO2 EOR operation, 20% of its CO2 will be recycled. By 20 years, that number goes up to 50%. By 25 years, that number goes up to 70% and by 30 years, that number goes up to 80% recycled.[95]

The U.S. Department of Energy's National Energy Technology Laboratory put it more simply in a 2019 paper on CO2 EOR, writing, "the objective of CO2 EOR operations is not to store CO2, but to maximize oil production. However, some of the injected CO2 ultimately does get stored in the reservoir as part of the process.[96]

“The need for the field to purchase new CO2 is gradually reduced over time,” further explains a 2019 paper published by the U.S. Department of Energy. “As a result, a greater percentage of the CO2 injected is from production, separation, and recycling versus newly-purchased CO2.” That paper further explained that “approximately half has been recovered and recycled” and more broadly “CO2 EOR operators try to maximize oil and gas production and minimize the amount of CO2 left in the reservoir.”[97]

A 2010 paper by the National Energy Technology Laboratory also explains the exact money saved by doing the recycling process, writing that "Because of the cost of naturally sourced CO2—roughly $10-15 per metric ton—a CO2 flood operator seeks to recycle as much as possible to minimize future purchases of the gas."[98]

Articles and Resources

Related GEM.wiki articles

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