Chinese exploration and production company Shaanxi Yanchang Petroleum has unveiled a major plan to reduce its carbon-emission footprint through carbon capture, utilisation and storage technology.

The initiative involves capturing carbon dioxide at its three coal-to-methanol projects in Yanan city, in northern China’s Shaanxi province, to build up capacity to capture, store and utilise 5 million tonnes per annum of CO2 in a two-phase programme involving three CO2 capture units and 15 well pads for reinjection wells, a senior company official said.

The Xian-based onshore operator has just awarded a contract to Sinopec Oilfield Service Corporation, an engineering arm of Sinopec, to carry out front-end engineering and design for the project.

Company vice president and chief geologist Wang Xiangzeng told a webinar on 11 March that the first phase will involve 2.4 million tonnes of CO2 capture capacity with 1.6 million tonnes of capacity to be built at Yulin Energy Chemical and 800,000 tonnes built at Yanan Energy Chemical.

During this phase, which ends in 2030, 676 reinjection wells will be drilled at eight drilling pads.

The second phase calls for adding 2.6 million tonnes of capacity at Yulin Coal Chemical by 2050.

A total of 678 wells will be drilled at seven drilling pads to reinject CO2 back into the reservoirs.

The CO2 will be compressed before being reinjected into reservoirs in order to enhance oil recovery, Wang said, adding that Yanchang will also build CO2 pipelines spanning 895 kilometres from three CO2 capture units to the well pads.

At Yulin Coal Chemical, Yanchang is already doubling the capacity to capture 300,000 tonnes of CO2.

Yanchang embarked on the CCUS-based EOR application in 2009 at three oil prospects it operates in Shaanxi. The CO2 is now transported by truck to the reinjection wells 150 kilometres away.

At the Wuqi and Jingbian well pads — with total rejection capacity of 50,000 tpa — Yanchang has reinjected 216,000 tonnes of CO2 back into reservoirs since 2009, lifting single-well output by 50%.

Another CO2 reinjection project based at Ansai well pad with capacity of 100,000 tpa was put into operation in August last year.

Yanchang will further expand the three facilities to 1 million tonnes of CO2 capture capacity by 2025, Wang said.

The CCUS project at Yulin Coal Chemical was recognised by the Carbon Sequestration Leadership Forum, a ministerial-level international climate-change initiative, in 2015 and was listed in the US-China Joint Presidential Statement on Climate Change.

One of China’s oldest oil producers, Yanchang last year produced 11.2 million tonnes of oil (224,000 barrels per day) and 8 billion cubic metres of natural gas.

The International Energy Agency said in a recent report that without CCUS it is impossible to reach international climate goals.

The agency said CCUS will be accountable for 15% of CO2 emission reduction.

Data from the Global CCS Institute shows that by the end of 2020 there were 65 commercial CCS projects worldwide, which are able to capture and permanently store 40 million tpa of CO2.

Of the total, 26 have started operation, three are under construction, two have suspended operations, 13 are under FEED studies and 21 are in the early stages of development.

In addition, another 34 are under pilot development as CCS demonstration projects.

China now operates about 40 CCS projects in 19 provinces, with a CO2 capture capacity of 3 million tpa.

Of the total, 13 are related to power generation and cement production, with CO2 capture capacity of 860,000 tpa, 11 are involved with oil and gas production, with annual capacity of 1.82 million tonnes including 1.54 million tonnes involved in EOR projects.

Most of these projects capture CO2 from industrial sources such as plants producing gas-fired power, petrochemicals, coal-based chemicals or iron and steel.

Wang said that it costs 117 yuan ($18.39) to capture one tonne of CO2 at Yanchang, which is considered low.

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