Injecting CO2 to enhance oil recovery can provide low-carbon oil, but care is needed to avoid double-counting the emissions reductions

Natural CO2

CO2

Oil rig

Anthropogenic CO2

Stored CO2 credited to oil sector

Credit to power

Credit to oil

Dollars per tonne CO

Costs of CO2-EOR projects compared with geological storage

150

100

50

0

-50

-100

Oil production cost

Storage

CO infrastructure

Transport

Capture

Oil revenue Total

One way to store CO2 underground is to inject CO2 into existing oil fields. This is a well-known EOR technique, as the addition of CO2 increases the overall reservoir pressure to force the oil towards production wells; it can also blend with the oil, improving its mobility and so allowing it to flow more easily towards production wells.

Today the majority of injected CO2 in CO2-EOR projects is produced from naturally occurring underground CO2 deposits. This may appear a somewhat ironic situation, given the wide efforts to reduce CO2 emissions from the global energy system, but it results from the absence of available CO2 close to oil fields. In the United States, for example, less than 30% of the near 70 Mt CO2 injected each year for

CO2-EOR is captured from anthropogenic sources.

Since CO2 is a costly input to the EOR process, CO2-EOR operators currently seek to minimise its use. In the United States, between 300 kg and 600 kg of CO2 is injected in EOR processes per barrel of oil produced. Higher utilisation rates are possible – injection of 900 kg CO2 per barrel produced could be technically possible in some fields – and this would not only boost production to a higher degree, but also ensure that a greater level of CO2 is stored per barrel of oil produced.

If enough man-made CO2 is injected during CO2-EOR, the amount that ends up stored in the ground could exceed the CO2 emissions from the production and combustion of the oil itself (the threshold depends on the level of scope 1 and 2 CO2 emissions but is around

600 kg CO2/boe). The full life-cycle emissions intensity of the oil therefore would be negative and the oil could be described as net “carbon-negative”.

However, this logic critically depends on from where the CO2 is sourced. A credit associated with storing CO2 underground can be counted only once: either it can reduce the emissions from the original source when it was captured or it can reduce the emissions from oil production. It cannot do both.

For CO2-EOR to produce negative emissions – that is, reduce the stock of CO2 in the atmosphere – EOR projects would need to inject CO2 that has either come from the combustion or conversion of biomass or has been captured directly from the air at a rate higher than the scope 1, 2 and 3 emissions arising from the production and consumption of the oil.

In the SDS, CO2-EOR production rises from 0.5 mb/d today to 1.6 mb/d in 2040, facilitated by higher carbon prices.

Besides the increase in production, a critical indirect benefit of CO2- EOR is that it offers a low-cost opportunity to deploy CCUS projects.

Combining CCUS facilities with CO2-EOR operations provides a costeffective way to deploy CCUS. The oil revenues generated reduce project costs and expand the amount of CO2 stored per unit of investment. Of the 23 CCUS projects currently operating or in construction today, 16 use the captured CO2 for EOR.

If further CO2-EOR projects using captured CO2 can be developed, this would be likely to reduce the costs of CCUS more generally through learning-by-doing, and by expanding the market and pipeline network for CO2.This could then provide a stepping stone towards large-scale deployment of CCUS, including for the production of low-carbon fuels such as hydrogen.