South Texas Heavy Industry and State Schools Receive Boost Through Mega-Scale Regional Decarbonization Project
HOUSTON--(BUSINESS WIRE)--The Texas General Land Office (GLO) awarded a Repsol-led partnership a contract for over 140,000 gross acres of pore space owned by of the Permanent School Fund (PSF) for CO2 storage located offshore of Corpus Christi, Texas. The partnership, comprised of Repsol as the operator, Carbonvert (Carbonvert Inc.), MEPUSA (Mitsui E&P USA), and POSCO (POSCO International) bring together their collective experience across oil and gas, carbon capture and storage (CCS), industrial, and renewable projects in the United States and globally.
The project will be located in proximity to over 35 million metric tons per year of existing industrial emissions within 100 miles of the storage sites and more than 20 million metric tons per year of anticipated greenfield project emissions expected by 2035 to create a globally competitive carbon storage hub that can provide significant economic and environmental benefits to local communities, the Port of Corpus Christi, the State of Texas, and society at large. Equity interests in the partnership will be 40 % Repsol (Operator), 40 % Carbonvert, 10 % MEPUSA and 10 % POSCO.
On August 22nd, the Texas School Land Board unanimously approved awarding leases of the Port Arkansas North and Mustang Island tracts to the partnership, subject to the execution of final leases, which made the partnership the sole awardee in the region. Both tracts lie within Repsol’s licensed seismic database and based on the favorable subsurface geology of the area, Repsol expects the tracts to have a combined storage capacity of more than 600 million metric tons of CO2.
David Ramos, Geological Low Carbon Solutions Director for Repsol said: “Repsol is excited to lead and operate this project that will ultimately add to our strong presence in the country through our O&G operations and Low Carbon projects. Corpus Christi is a strategic region for Repsol pursuing Low Carbon developments where the Port of Corpus Christi plays an essential role for the industry. This project will provide significant contributions internationally as well to help grow our global low carbon portfolio.”
The consortium will now enter a negotiation stage with the Texas GLO based on terms the partnership submitted along with the original request by the GLO. Final terms are subject to approval of the Texas School Land Board.
Carbonvert CEO Alex Tiller sees this project as a boost for South Texas' regional economy, “instilling confidence in local industries to launch CO2 capture initiatives and enhance resilience amid carbon-related global trade requirements and customers’ increasing demand for low-carbon products. It also attracts local investments from sectors like blue hydrogen and sustainable aviation fuel refining.” Tiller went on to point out that, “our project's CO2 storage lease and operations will generate tremendous new revenues for the Permanent School Fund over the next 30 years for the Texas public school system--a win for the whole state.”
Kazuhiko Gomi, President & CEO of MEPUSA said: ”Mitsui sees the Corpus Christi region as an emerging hub for low carbon solutions and energy transition. Mitsui is excited to expand its CCS portfolio in the US to contribute to local industrial emissions reductions for Creating Sustainable Futures.”
Jhoon Soo Jho, Head of E&P Business Division for POSCO International: “I am pleased that through this project, we are taking the first step towards a successful business with trusted partners. This CCS project will make a significant contribution to achieve global carbon reduction and a sustainable society, making it a very meaningful endeavor. With this project as a catalyst, POSCO International will accelerate the expansion of its eco-friendly portfolio and continue to discover businesses that are in compliance with our corporate citizenship initiative for both the global and local communities.”
Repsol is a global multi-energy company that is leading the energy transition with its ambition of achieving zero net emissions by 2050. Present throughout the energy value chain, the company employs 24,000 people worldwide and distributes its products in nearly 100 countries to around 24 million customers. The company is deploying an integrated model of decarbonization technologies based on enhanced efficiency, increased renewable power generation capacity, production of renewable fuels, development of new customer solutions, the circular economy, and driving breakthrough projects to reduce the industry's carbon footprint, including carbon capture and storage. Repsol has set a target to reduce the carbon intensity of its upstream activity by 75% in the period from 2021 to 2025.
Carbonvert Inc. is a carbon capture and storage project development and finance company that simplifies decarbonization for industrial facilities. Carbonvert was established in 2020 by Alex Tiller and Jan Sherman, veterans of the renewable and conventional energy sectors to manage the financial and technical complexities of CCS project development. Our executives have 70+ years of combined experience developing large-scale projects, financing tax advantaged projects, and structuring over $4 billion in infrastructure investments, including equity, tax equity, and debt. Our executives have extensive experience with large-scale CO2 projects; have designed and secured environmental and CO2 storage permits; and completed and operated large-scale carbon capture, transportation, and storage projects, including Bayou Bend CCS in Chambers and Jefferson County, Texas, Quest CCS in Alberta, Canada, and In Salah in Algeria. For more information, visit www.carbonvert.com
Mitsui E&P USA is a Houston-based, independent oil and gas exploration and production company that oversees upstream activities in North and South America and whose ultimate parent company is Japan-based Mitsui & Co., Ltd. Mitsui has producing assets in South Texas, Marcellus in the northeast of the United States, the Kaikias offshore project in the Gulf of Mexico, and exploration blocks in Brazil and Argentina. Mitsui & Co. is a global company with a diversified portfolio of trading, investment and business activities across various industries including Mineral & Metal Resources, Energy, Infrastructure Projects, Mobility, Chemicals, Iron & Steel Products, Food, Food & Retail Management, Wellness, IT & Communication Business, and Corporate Development Business. Globally, Mitsui & Co. has strong CCS ambitions, and is actively involved in the sector through strategic investments in CCS development companies, carbon offset companies and CCS assets, and additionally has several strategic ventures studying and investing in the capture, shipping and sequestration of CO2.
POSCO Group is a global leading steelmaker, recognized as the world's most competitive steelmaker for 13 consecutive years according to the World Steel Dynamics and provider of eco-friendly future materials with its philosophy of Corporate Citizenship. As a major affiliate of POSCO Holdings Inc. (NYSE: PKX, KRX: 005490), POSCO International Corporation (KRX: 047050) has two major business sectors divided into energy such as E&P and LNG businesses, and global trading including steel, agriculture and eco-friendly materials. Posco International has established the fundamental roadmap to the Net-zero Commitment 2050. This roadmap includes a mid-to-long-term strategy to further elaborate on and pursue the vision of Carbon Neutrality by 2050. POSCO International Corporation has the ambition to reduce from the baseline emissions, 37% by 2030, and to ultimately achieve Carbon Neutrality by 2050.