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Dr. S. Julio Friedmann

Deputy Assistant SecretaryOffice of Clean CoalJanuary 2014

The role of CCS/CCUS in the Climate Action Plan

Global CCS Institute – 3rd Americas Forum

Feb. 27th, 2014, Washington, DC

We live in a time of energy abundance

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We’re #1! • In Oil and Gas production• In Innovation

We’re #2! • In Coal production & use• In GHG emissions

We’re top 10 • In renewable loading• In uranium production

Once in a generation opportunity to build

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Many energy & environmental challenges face the world

Increasing energy demand (2-3x increase)Water scarcityPollution reduction

Greenhouse gas emission reductionClimate change and arctic impacts

40 years of EOR and 15 years of CCS

Where are we today?

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IEA CCS Roadmap 2013: Key Technologies for Reducing Global CO2 Emissions

Source: IEA Roadmap 2013. Note: Numbers in brackets are shares in 2050. For example, 14% is the share of CCS in cumulative emission reductions through 2050, and 17% is the share of CCS in emission reductions in 2050, compared with the 6DS.

Most 2050 climate budgets require CCUS from NatGas power

US climate change policy currently consists of a portfolio of federal and state initiatives

(in effect unless noted)

• Federal renewable fuel standard

• Federal vehicle fuel economy standards

• Various alternative vehicle tax credits, rebates, and sales targets

• Infrastructure tax credits

• Fuel tax credits (most expired)

• California economywide GHG cap-and-trade

• California Low Carbon Fuel Standard (in effect, but suit pending)

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(in effect unless noted)

• Federal renewable tax creditsFederal appliance standards

• Federal conventional pollutant regulations*

• Federal CO2 performance standards (under development)

• State renewable portfolio standards

• State energy efficiency programs

• California economywide GHG cap-and-trade

• RGGI cap-and-trade

• Other state programs

*Not explicitly targeting CO2 emissions, but nonetheless impactful. Note: RGGI = Regional Greenhouse Gas Initiative.

Source: US EIA; IHS CERA

Power

Other

On-road trans-port

2011 US CO2 emissions by major sector

Key policies targeting transportation CO2

Key policies targeting power CO2

Slide from IHS Forum “International Carbon Policy Trends: Is a role reversal under way”, 19 September 2013 • Houston

President’s Climate Action Plan: Three overarching themes

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Mitigation (emissions reduction)• ALL OF THE ABOVE• Efficiency, Renewables, Nuclear, Gas• Coal with CCS/CCUS

Adaptation and resilience• Smart, reliable grid• Key infrastructure investments

International Partnerships• China and Asia• Coordinated intl. efforts

Once in a generation opportunity to build

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President Obama’s Climate Action Plan focuses onUS power sector CO2 emissions

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• ~20 directives and initiatives to reduce US GHG emissions.• The EPA WILL complete CO2 performance standards for power plants under

the Clean Air Act

Final ruleDraft rule

2013 2014 2016 20172015

20 Sept. 2013

1 June 2014

1 June 2015

30 June 2016

State implementation plans

New presidentElection year

CO2 NSPS – New Source Performance Standards*

CO2 ESPS – Existing Source Performance Standards

2014–15

CCS is THE key technology for the 2nd era of fossil energy abundance

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Policy drivers• President’s Climate Action Plan• EPA: NSPS (draft) and ESPS (pending)• State actions (AB32 etc.)

Technical findings (2008-present)• IPCC WG1 report: must read policy summary!• Continued GHG accumulations• Challenges will all energy scale-ups

Global economic context• G2 world• Investors speak• Return to growth

Once in a generation opportunity to build

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Large Scale Integrated Projects World Wide

1972

1982

1986

1996

2000

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2008

2010

2013

2014

2015

2016

2017

2018

2019

2020

2022

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10

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0

20

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Operate Execute DefineEvaluate Cum. Volume

Num

ber

of

Pro

ject

sV

olume C

O2 (m

tpa)

Data from Global CCS Institute

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The US and international community have deployed over a dozen large CCS projects

Large commercial projects

Pending commercial projects

CO2-EOR

DOE Regional Partnerships Intl. research projects

Key unit of innovation – global engines of discovery

DOE’s top CCS/CCUS priorities

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Success of the demos• Serial # 1 in operation 2013-2018• A deep and rich set of public learning

Reimagining the coal and CCS RD&D portfolio• Advanced combustion• Capture and storage: incl. footprint reduction• 2nd generation large pilots

International Partnerships• China• Key OECD countries

New mode: delivering solutions

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DOE CCUS Demonstration Projects

CCPI

FutureGen

ICCS (Area I)

Hydrogen Energy CaliforniaIGCC with EOR

$408 Million - DOE$4.0 Billion - Total

Summit Texas Clean EnergyIGCC with EOR

$450 Million - DOE$1.7 Billion - Total

NRG EnergyPost Combustion with CO2

Capture with EOR$167 Million – DOE$339 Million - Total

Air ProductsCO2 Capture from Steam

Methane Reformers with EOR$284 Million - DOE $431 Million - Total

LeucadiaCO2 Capture from Methanol

with EOR$261 Million - DOE $436 Million - Total

Archer Daniels MidlandCO2 Capture from Ethanol w/ saline storage

$141 Million - DOE $208 Million - Total

FutureGen 2.0Oxy-combustion with CO2 capture

and saline storage$1.0 Billion - DOE

$1.3 Billion - Total

Southern Company ServicesIGCC-Transport Gasifier w/CO2 pipeline

$270 Million - DOE$2.67 Billion - Total

Focus – Large-scale commercial demonstration of CCUS integrated with coal power generation and industrial sources.

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Major Demonstration Projects

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Recipient Project Location DOE Funding Status Storage Type

CO2 Seq.(Metric Tons Per Year)

StorageStart

Air ProductsSteam Methane Reformer

HydrogenProduction

Port Arthur, TX $284M Operations EOR ~925,000 2013

Southern Company Services

(Kemper)

Integrated Gasification Combined Cycle (IGCC)

Kemper County, MS $270M Under

Construction EOR ~3,000,000 2014

Archer Daniels Midland

Ethanol FermentationCO2

Decatur, IL $141M Under Construction Saline ~900,000 2014

NRG Energy (Petra Nova )

WA Parish

Retrofit Pulverized Coal plant Thompson, TX $167M Financing EOR 1,400,000 2016

SummitTexas Clean Energy

Project

Integrated Gasification Combined CyclePolygeneration

Penwell, TX $450M Financing EOR 2,200,000 2017

Leucadia Energy, LLC Methanol from Petcoke Gasification Lake Charles, LA $261M

Front End Engineering &

DesignEOR ~4,500,000 2017

FutureGen 2.0Oxycombustion

Pulverized Coal Boiler Retrofit

Meredosia, IL / Morgan County, IL $1B

Front End Engineering &

DesignSaline 1,000,000 2017

(est.)

Hydrogen Energy California (HECA)

Integrated Gasification Combined Cycle Polygeneration

Kern County, CA $408MFront End

Engineering & Design

EOR 2,570,000 2019 (est.)

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Loan Program Office Project Development Financing

LPO Advanced Fossil Energy Solicitation

CARBON CAPTURE• From traditional coal or NG generation• Saline formations or EOR

ADVANCED RESOURCE DEVELOPMENT• ECBM, UCG, novel oil and gas drilling• Use of co-produced waste gases vs. flaring

LOW CARBON POWER SYSTEMS• Oxycombustion, chemical looping• Syngas-, H2, or NG-based fuel cells

EFFICIENCY IMPROVEMENTS• CHP and waste-heat recovery• High-T or high-efficiency cycles

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A technology pipeline for affordable CCS

We need more 2nd generation pilots!

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Pathway for Technology CommercializationTRL 2 Successes

from FWP, SBIR/STTR, ARPA-E

Transfer to Office of Major Demonstrations

Scope of Capture Program

“Valley of Death” for Technologies

We need more 2nd generation pilots!

What 2nd gen large pilots should deliver

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2-3 NEW and credible pathways to low-cost CCS• 25-50 MW scale unit performance• Working partnerships for commercialization• Robust economic characterization

Rich engineering data and results• Steady state and dynamic performance• Full footprint accounting (products; water)

Definitive storage knowledge and tools• Data needs for quantitative risk assessment• Sites to field test technology• Foundation for subsurface mastery

20This work performed under the auspices of the U.S. Department of Energy by Lawrence

Livermore National Laboratory under Contract DE-AC52-07NA27344

• Many 10’s of billions producible just US; 100’s of billions worldwide

• Required to finance first set of projects; required to drive down costs through deployment

• Additional domestic supply, revenues; reduced imports B

illio

n B

arre

ls

88.1

47.4

2.30

20

40

60

80

100

TechnicallyRecoverable

EconomicallyRecoverable*

AlreadyProduced/

Proven

Domestic Oil Resources

ARI, 2008

Mill

ion

Met

ric T

ons

Total U.S.CO2 Demand

NewLower-48

CO2 Demand

Net Lower-48From CapturedCO2 Emissions

0

2,000

4,000

6,000

8,000

10,000

12,000

14,00012,500

9,700

7,500

2,800* 2,200**

Market CO2 demand

In the near term, EOR is a critical bridging step that brings near-term benefits to the US

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Emergent networks of EOR-anchored projects: Anchors for additional development

Ground work for pipeline networks; fast followers; CO2 utilities

• Permian basin; Gulf Coast; California; N.

Dakota/ Saskatchewan• Central Alberta Basin

• Scotland/Central N. Sea• Ordos basin

MIT, 2010

Opportunity for govt. fast-tracking and co-development

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The future looks bright – we should pursue important new opportunities

WATER: Both challenge and opportunity

• Water co-production: 8M m3 water for 6M tons CO2.

• Water reclamation: lignite drying

• Water integration: upgrading municipal water with waste heat

UTILIZATION: Part of the work and value

• EOR already common; ROZ advancing (Negative C oil demonstration)

• CO2-Algae: small volumes, tough economics; improving

• Cement and mineralization: small volumes, tough economics; improving

Entering commercial realm; now it gets exciting

Co-produced freshwater as utilization

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Ready to pilot! Seeking partners and possibilities

Bourcier et al., 2011

Below 80,000 TDS, costs ~50% of conv. desal.

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Ready to pilot! Seeking partners and possibilities

Bourcier et al., 2011

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Longer than expected: ROZ volumes

This work performed under the auspices of the U.S. Department of Energy by Lawrence Livermore National Laboratory under Contract DE-AC52-07NA27344

• 2x-3x recovery potential and storage potential (12-18 Gt in ROZ vs. 6.4 for main pay zones,

PB)

• Possibility for carbon-negative HC

Main Pay Zone (MPZ)

Transition Zone (TZ)

Residual Oil Zone (ROZ)

Base of Ultimate OWC

Base of Producing OWC

4900

4950

4800

4850

5000

5050

5400

5350

5300

5250

5200

5150

5100

5450

OWC

100 0Oil Saturation %

“State of the Art” “Next Generation”

(millions) (millions)

CO2 Storage (tonnes) 19 109

Storage Capacity Utilization 13% 76%

Oil Recovery (barrels) 64 180

% Carbon Neutral (“Green Oil”) 80% 160%

ARI, 2008

ARI, 2008

Sources: MIT, 2010; ARI 2007 and 2010; NETL 2008

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Global challenge global progress: new global solutions still required

Key unit of innovation – global engines of discovery

Uthmaniyah (KSA)

Lula (BRA)

Quest (CAN) Mongstad (NOR)

ESI (UAE)

Gorgon (AUS)

GreenGen (PRC)

We just need more projects and more information

We must harness this age of abundance

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Know something• Learning opportunity in CCS and clean fossil• Information sharing: partnership as product

Do something worthy• Opportunity to invest: in plants, infrastructure, R&D• Opportunity in grand bargains

Ask friends for help• Friends in the US• International partners

Once in a generation opportunity to build