Carbon storage

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Bout 350/ acre

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Nah, it's usually around 350/Mcf when dealing with gases.

Why store something that nature naturally converts to oxygen?

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Get a lawyer that specializes in this.

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So they can take 80% of the proceeds?


Hell no.


Just ask around

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Why store something that nature naturally converts to oxygen?

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Because new government/EPA regulations are instituting emissions restrictions for petrochem, LNG and other large industrial plants, so industry is trying to find solutions for what is being forced upon them.

OP:

These carbon sequestration agreements are pretty new. These types of agreements have been negotiated for lands in Louisiana really just over the past three to four years, so it isn’t something that’s been hashed out and evolved like oil & gas leases. I would highly recommend at least an oil & gas attorney, or someone who is versed in liability and environmental protection language, to look over any agreement with you.

Most of the agreements for this type of stuff in Louisiana that I’m familiar with will pay you X amount of $$ per acre to hold the agreement for X amount of years, in order for the company to acquire seismic data, file their Class 6, and get approval. Then they start building out infrastructure. Once injection starts, then you’d be compensated at a $$ per ton of CO2 injected, which you would also negotiated with the agreement that paying you a per acre to hold the acreage.

Five years should be fair. Three years, like your standard Louisiana Bath oil & gas form, is tough for the outfit due to all the upfront work they have to do. Though, since you only have 20 acres, I’d imagine they may have already done the deal with the large timberland company near/around your acreage (someone like Hancock Timberland or Mulpus??) a couple years back and just might now be approaching you to fill in the “unleased” acreage.

You should ask them if they’ve filed their Class 6 application already. If they have, then there’s no need for them to tie your acreage for more than three years before they start injecting. Also, maybe ask them if they’re doing air capture sequestration or point source from emitters, like the LNG plants on the coast.

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I believe you can sell the carbon credits on what your land is holding. That’s where you make some money. @$50 per metric ton of carbon dioxide stored.

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I don’t believe you can double dip. Either the company doing the injection, or the emitter themselves whose normally released CO2 is now being injected, receives the credit. What the landowner who is leasing out his porespace can receive is either a negotiated royalty, like an oil and gas lease, or a $ amount per ton injected, kind of like a $ per barrel injected with a saltwater disposal well.

I think the market in Southern Louisiana now is something like $2 to 4 per injected ton of CO2.

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any carbon capture projects that go forward are just going to make an area undrillable for future O&G drilling

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Won’t make it undrillable, but if the zone of injection is more shallow than the potential hydrocarbon zone, then more expensive as your wellbore casing will need to be “sealed up better”. I’m not a drilling engineer, so I don’t know all that’s involved with that.


Companies drill through CO2 floods in the Permian where the company doing the EOR flood owns the shallow depths leased and another company owns the deep rights leased.

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wellbore casing will need to be “sealed up better”

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Right. The companies we talked to said it would make exploratory drilling much more costly and not worth it. But in developmental drilling, you know what the revenue v. costs will be, so they can design for it.

I'm assuming they want to drill an injection well on your property? in which case they would also likely need a pipeline ROW. pipeline ROW lease fees/agreements should be easy to figure out in your area (ask other landowners who have pipelines crossing their property).

Regarding the well, I would contact the Underground Injection Control (UIC) Section of the LA Department of Natural Resources. find other landowners where wells are being or have been drilled for CO2 storage, and figure out what their leases and royalties look like. that should give you a good starting point. When they present you with a contract, you might want to have a lawyer or landman take a look