By Catherine Airlie – Sep 16, 2010 12:00 AM GMT+0100
Royal Dutch Shell Plc and BP Plc stand to make serious profit by pumping carbon dioxide from European power plants into North Sea oil fields, according to Petroleum and Renewable Energy Company Ltd.
Putting carbon dioxide into old oil wells may yield profits of as much as $40 a metric ton in the next decade, Stewart Whiteley, managing director at the consultant known as Petrenel, said today at a seminar at Londons Geological Society.
You can start making serious profits out of this, Whiteley said. Its a matter of whoever gets there first.
Enhanced oil recovery involves pumping carbon dioxide into underground reservoirs to extract more crude than would otherwise be obtained through natural pressure. The process has the advantage of extending the lifespan of an oil field, while permanently burying the pollutant. Carbon capture and storage has been touted as a way of slashing emissions of CO2, a greenhouse gas blamed for climate change.
Kinder Morgan Energy Partners Ltd. and Denbury Resources Inc., two pipeline operators in the U.S., are profiting on transporting and storing CO2, Whiteley said.
BP, Europes second-largest oil company after Shell, shelved a plan to use its Miller field in the North Sea for CO2 storage in 2007 after the U.K. didnt provide the company with tax incentives for the project.
Petrenel estimates it costs $7 to $20 to dispose of a metric ton of carbon dioxide underground for storage in an aquifer or depleted gas field. The CO2 could turn into an asset in extracting more oil, he said.
The figures dont account for costs of capturing the CO2 from the source, such as power stations, just transporting and storing the gas, he said.
Editors: Mike Anderson, Stephen Cunningham.
To contact the reporter on this story: Catherine Airlie in London at [email protected]
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