Wyoming poised to take on carbon dioxide, pump it underground

Backed by the promise of billions in federal dollars, energy companies are lining up to accept an invitation by Wyoming officials to collect industrial sources of carbon dioxide and pump it deep underground. 

Essentially, the vision is to build a new low-carbon energy industry that scrubs the planet-warming gas from fossil fuels, keeping those fuels in the energy mix and simultaneously helping to address the climate crisis in a way that pays dividends to developers and the state.

Wyoming, according to Gov. Mark Gordon and other state officials, is primed to launch the industry. 

Not only has the state spent years testing its subterranean capacity to permanently store carbon dioxide, it has devoted more than a decade to building a legal and regulatory framework to win the federal government's approval. Only Wyoming and North Dakota have won primacy over the federal program to permit such activities.

Now, the state's top environmental regulator is considering the first in what many expect to be a wave of permit applications to drill the deep wells necessary to launch the new industry.

"Since 2010 [Wyoming has] been working on how to ensure this particular program could get off the ground and be protective of the environment with a lot of the risks that are involved with these kinds of projects," said Lily Barkau, natural resources program manager at the Wyoming Department of Environmental Quality.

The agency is soliciting public comments on three carbon dioxide injection well permit applications submitted by Frontier Carbon Solutions. Two more "Class VI" permits are under review at the agency, but not yet ready for public feedback.

Sequestering CO2

Industry and regulatory officials eagerly note that pumping carbon dioxide underground isn't fantasy. For decades, oil and gas developers have pumped the gas into oilfield formations to squeeze out more oil. Wyoming even has a "backbone" carbon dioxide pipeline that delivers the gas from southwestern and central Wyoming to multiple oilfields in the northeast corner of the state and into Montana.

While Wyoming still hopes to expand "enhanced oil recovery" via carbon dioxide injection, officials are also eager for companies to pump the gas deeper underground into saline formations. Here, at depths of 10,000 to 15,000 feet, carbon dioxide - compressed into liquid form - can be pumped and stored permanently, according to state and industry officials.

Assurances that the gas will remain underground are based on seismic surveys and deep geologic testing conducted by the U.S. Geological Survey and the University of Wyoming School of Energy Resources.

There are skeptics, however, and many questions about the logistics of deep carbon dioxide "sequestration," as well as whether all of the public resources invested are justified.

Skepticism and questions 

So far, capturing carbon dioxide from industrial smokestacks - be they attached to trona processing plants, cement factories or coal-fired power plants - hasn't proven economical at large scale. However, industry officials point to the federal 45Q tax credit - which was expanded under the Inflation Reduction Act - for vastly improving the economics of carbon capture and storage.

Until industrial facilities in the southwest region of the state - including in corners of Colorado and Utah - are fitted with carbon capture, Frontier Carbon Solutions plans to collect its carbon dioxide from a "direct air capture" project still in development.

Other questions remain: 

How will facilities such as direct air capture farms get carbon-free power without sprawling renewable energy development on sensitive landscapes?

How much will it cost to safely manage highly saline water displaced by carbon dioxide in deep geologic formations?

And, is all the time and public resources merely a distraction from proven renewable energy and the declining costs of installing wind and solar energy? 

"Billions of dollars have been wasted trying to prove that this technology is real," Wenonah Hauter, executive director of Food & Water Watch, told the Associated Press in May. "And all we have to show for it are a series of spectacular failures.'' 

Projects under review

Texas-based Frontier Carbon Solutions is a partner in the Sweetwater Carbon Storage Hub project in southwest Wyoming. The effort is part of the federal CarbonSAFE Initiative led by the University of Wyoming's School of Energy Resources, which won $40.5 million in support from the U.S. Department of Energy. UW and Frontier Carbon Solutions will contribute another $10.1 million to the project for a total of $50.6 million, according to DOE and university officials. 

The "storage hub" will have a minimum storage capacity of 50 million metric tons of carbon dioxide over the life of the project - about 20 years, according to Frontier Carbon Solutions. For context, Wyoming's annual carbon dioxide emissions from industrial fossil fuel consumption - excluding motor vehicle pollution - was 54.6 million metric tons in 2021, according to the U.S. Energy Information Administration. 

The company is seeking three permits under the Wyoming Department of Environmental Quality's Underground Injection Control program. Public comment closes Oct. 19.

Comments can be submitted electronically via DEQ-online portals for each of the three permits: permit 242, permit 243 and permit 244. Comments may also be submitted by mail to: Ms. Lily Barkau, P.G., Groundwater Section Manager, Wyoming Department of Environmental Quality, Water Quality Division, 200 West 17th Street, 2nd Floor, Cheyenne, WY 82002.

DEQ will also hold a public hearing on the Class VI well permits, with dates yet to be announced. If the permits are approved, the company will still have to submit more information from initial drilling activities before DEQ can grant Frontier Carbon Solutions a permit to actually inject carbon dioxide, Barkau said.

Tallgrass Energy is also seeking a Class VI injection well permit for its Eastern Wyoming Sequestration Hub in Laramie County. That permit is not yet up for public comment. However, the U.S. Bureau of Land Management is seeking public comment regarding the company's application for rights-of-way on federal surface in Laramie County.

Public comment has been extended to Oct. 10. More about the project and how to comment can be found on the BLM's project website.

Tallgrass was awarded $4.1 million for the project from the Wyoming Energy Authority in 2022, which the company will match in full, according to the agency. The grant comes from a $10 million legislative appropriation for carbon capture, storage and utilization projects.

First round of carbon dioxide injection permitting

Wyoming is one of only two states with primacy over the federal Class VI injection well permitting process. 

The state won authority over the program after more than a decade of legislation to establish a legal and regulatory framework to allow for the geologic storage of carbon dioxide. 

That framework includes settling the question of who owns the underground "pore space" where carbon dioxide will be stored. The state declared it belongs to the surface estate, which clarifies who gets paid for use of the pore space and who is liable. The state also set out to appease potential developers by giving them an opportunity to transfer their liability for carbon dioxide injections to the state if they meet post-closure requirements intended to protect water and human health, according to Barkau.

Wyoming, with primacy over the federal Class VI injection well permitting program, can shave years off the permitting process, Barkau said. And that makes Wyoming an attractive place to launch carbon dioxide storage projects.

"I think we've been able to prove that if the operator is willing to work collaboratively, it can be done in a very expedited time frame and still meet all of the rules and regulations and be protective of human health and the environment," Barkau said.