At LandGate, we are starting to get a lot of questions from property owners about storing CO2 underground in pore space. They are confused and they have the right to be. They are hearing that surface owners will be paid. They know they can list their surface on LandGate and be paid for leasing their land to Solar Developers, Wind Developers, Battery and Energy Storage Developers, Carbon Credits and more. They have read about trees and soils capturing and storing CO2 from the atmosphere. But now they are hearing that CO2 will be put into pipelines and injected underground in old oil and gas fields.
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In a series of articles, LandGate will begin answering the many questions landowners are asking regarding to the underground storage of CO2, such as:
If CO2 is stored underground, will it contaminate drinking water?
How many miles of pipeline will have to be constructed across the U.S. for underground storage?
Will the underground storage of CO2 have a positive effect on climate change?
Will I be required to grant a pipeline easement across my property?
Can we take CO2 from coal burning power plants before it is emitted into the atmosphere?
What is Carbon Capture and Storage?
Carbon Capture and Storage (CCS) is also sometimes referred to as the Underground Storage of CO2. It is one of the many ways of reducing carbon emissions, which will be key to helping to tackle global warming. Step 1 – Carbon Dioxide is captured before it is emitted into the atmosphere. It is captured from coal and natural gas fired power plants and other plants such as ethanol, fertilizer, cement, steel, and agricultural industrial plants. Step 2 – The CO2 is compressed into a liquid so that it can be transported by pipeline. It is also possible to transport the CO2 by trucks and ships. Step 3 – The CO2 is then injected into the pore space of deep rock formations for permanent storage.
Who owns the pore space where the CO2 is to be permanently stored?
Property rights in the U.S. can be divided into two separate estates - the mineral estate and the surface estate. In many parts of the United States, especially in areas where oil and gas drilling has taken place, it is common for the mineral rights to have been severed from surface rights. In most cases, the severance of the surface and minerals takes place when property is sold. The transfer of ownership of property rights generally happens when the owner, also referred to as the Grantor, executes a Deed, transferring title to the buyer, also referred to as the Grantee.
The deed would contain language such as: “Notwithstanding anything contained herein to the contrary, Grantee hereby reserves all of Grantor’s right, title and interest in and to all the oil, gas and other minerals in, on and under the described lands.”
After the deed containing this language has been executed by the Grantor, the estates are split. Although there are multiple storage sites for CO2, popular storage sites are pore spaces found in depleted oil and gas reservoirs. These reservoirs, also referred to as geologic formations, at one time, did contain oil and gas. When the pore space in those formations contains oil, gas and other hydrocarbons, the mineral owner owns the pore space. The mineral owner has the right to explore for and produce those hydrocarbons. The mineral owner also has the right to grant an oil and gas lease to an exploration company and receive the benefits of ownership, such as the right to receive bonus, royalty, and other compensation from the proceeds of the sale of the oil and gas which is produced from the pore space. However, although some jurisdictions are still attempting to clarify previous rulings, once the pore space no longer contains hydrocarbons, that pore space belongs to the owner of the surface estate. In that case, it’s the surface owner who will benefit from granting the right to store CO2 in the pore space. At LandGate.com, we are a marketplace where landowners have a lot of options on how they can earn money without ever having to sell their land. We are happy to take your calls, respond to your emails and we look forward to hearing from you.