The natural gas processor Lucid Energy announced that the US Environmental Protection Agency (EPA) has approved its previously submitted monitoring, reporting, and verification (MRV) plan for what will become the largest carbon capture and storage (CCS) project in the Permian Basin.
It will aim to safely store carbon dioxide permanently in existing and permitted disposal wells from its Red Hills natural gas processing complex in Lea County, New Mexico. The CO2 sequestration project is scalable and would enable Lucid to offer capture and storage services to its customers while also reducing its carbon footprint.
The next stage of the plan is to gain approval from the Internal Revenue Service to use CO2 sequestration tax credits under Section 45Q.
Relevant: What is The 45Q Tax Credit For Oxide Sequestration?
“This strategy has proven beneficial for all stakeholders, as Lucid currently removes more CO2 from Permian Basin shale production than any other midstream operator. In turn, Lucid is the perfect candidate to develop the largest CCS project in the Permian Basin by simply modifying and expanding our existing operations. We are committed to finding safe, creative and effective ways to serve the growing needs of our customers while reducing our environmental footprint,” said Mike Latchem, CEO of Lucid Energy.
Lucid’s Red Hills site is the Delaware basin’s largest gas processing complex that consists of five plants with a combined processing capacity of 920 MMcfd. The company is also the largest privately held natural gas processor in the Permian Basin that provides a full range of gas midstream services to more than 50 customers in New Mexico and West Texas.
The approval of the plan for the carbon capture and storage project would facilitate the decarbonization of the industry at the Permian Basin and enhance the capabilities of Lucid Energy to increase its revenue stream by providing CO2 sequestration services to its clients.
