Valero, BlackRock steer CCS pipeline project in US Midwest
More than 1,900 km of pipeline in the US Midwest could be utilised as a CO2 gathering system, Valero Energy and BlackRock said on March 18.
Valero and an energy investment fund led by BlackRock will work with Navigator Energy Services, a midstream services provider, to develop a pipeline with various points from Nebraska to Illinois that can capture CO2.
The proposed system would transport liquefied CO2 through a pipeline for delivery to a sequestration facility planned for Illinois. Valero would be the primary shipper and secure most of the initial system capacity.
“This project demonstrates our leadership in energy transition through innovation in renewables,” Valero CEO Joe Gorder stated. “We continue to expand our long-term competitive advantage with investments to produce lower carbon fuels.”
The International Energy Agency (IEA) has described carbon capture and storage (CCS) facilities like these as integral components of a carbon-neutral future, though cost can be an impediment. In January, the IEA noted that, even with the pandemic, total investments committed globally to CCS last year were around $4.5bn.
None of the parties to the proposed pipeline system have offered a cost estimate.
Navigator, the midstream partner, is expected to lead construction and operation of the pipeline system with a goal of commissioning the system by late 2024.
“Now is the time for industry-leading market participants to join forces to complete an environmentally focused midstream project of this size and scale,” Navigator’s CEO Matt Vining said.
Valero estimates the system will be able to store as much as 5mn mt/yr of CO2 initially, but could ramp up to 8mn mt/yr if the demand is there. Any potential shipper can submit a non-binding expression of interest on April 30.