Denbury Signs Definitive Agreement With Lake Charles Methanol For Carbon Transportation and Storage 

Denbury Signs Definitive Agreement With Lake Charles Methanol For Carbon Transportation and Storage - Carbon Herald
Lake Charles. Image: Felix Mizioznikov/Shutterstock

Oil and gas company Denbury announced on Oct. 27 that its subsidiary Denbury Carbon Solutions has signed a 20-year definitive agreement to offer carbon transportation and storage services to Lake Charles Methanol (LCM) in association with its planned blue methanol project.

The LCM site will be located near Lake Charles, Louisiana, about 10 miles away from Denbury’s Green Pipeline. The facility will utilize decarbonization company Topsoe’s SynCORTM technology that turns natural gas into hydrogen, which is then synthesized into methanol. The project is expected to bring more than 500 million kilograms of hydrogen annually as a feedstock to produce 3.6 million metric tons per year of blue methanol while capturing 1 million metric tons per year of carbon. 

The carbon captured by LCM will be transported to the Green Pipeline by Fenbury and then to one of the planned sequestration hubs along Denbury’s Gulf Coast pipeline network.

Denbury also plans to build a pipeline connection from the industrial area of Lake Charles to the company’s Green Pipeline. According to Denbury, the new pipeline will assist in the transportation and storage of a significant amount of additional carbon emissions from the industrial area.

Relevant: Carbon Capture Project In Louisiana Makes Approval Progress

“We’re excited to reach this significant agreement with LCM on its innovative Blue Methanol project,” said Nik Wood, Senior VP and head of Denbury Carbon Solutions. “In addition to serving LCM’s CO2 transportation and storage plans, our pipeline network expansion into the Lake Charles area will position Denbury to help other industrial customers decarbonize their businesses.” 

LCM is currently finalizing its major permits to start construction, and securing services for its CO2 transportation and sequestration. The Final Investment Decision is expected by 2023, and the first production is planned for 2027. 

“Denbury’s world-class carbon sequestration infrastructure pairs well with LCM’s best-in-class use of innovative technology to achieve clean hydrogen production as defined by the Inflation Reduction Act and the Bipartisan Infrastructure Framework,” said Don Maley, Chief Executive Officer of Lake Charles Methanol. 

Read more: Exxon Considers Buying Oil & Gas Company Denbury

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