HOUSTON – Amid mounting pressure from investors to address climate change, Exxon Mobil proposed a $ 100 billion project on Monday to track carbon emissions from large industrial plants in the Houston area and deep beneath the Gulf of Mexico to bury.
Exxon, the largest US oil company, is looking to build a profitable business from capturing carbon emitted from petrochemical plants and other industries. However, his plan would require significant government support and intervention, including the introduction of a price or tax on carbon emissions, an idea that has not received enough support in Congress in the past.
The company is already capturing carbon that it is injecting into older fields to produce more oil. Exxon now wants to use its know-how to store the carbon dioxide generated by other industries. Without a price for carbon emissions, however, many companies would have little financial incentive to pay Exxon to capture and store their carbon.
The Obama administration has failed to put in place a cap-and-trade system that increases the cost of polluting companies by forcing them to buy tradable permits to release greenhouse gases into the atmosphere. California, the European Union, and 11 states in the Northeast use versions of Cap-and-Trade. Other governments, including British Columbia and the UK, have imposed a per tonne emissions tax.
Exxon plans to capture carbon from industrial facilities along the Houston Ship Channel and pipe it offshore, where it would be stored up to 6,000 feet below the Gulf of Mexico. The effort would be paid for by industry and the government, and it would eventually save 100 million tons of carbon per year – the equivalent of 20 million cars, Exxon said.
The company has discussed its idea with national and Texan policymakers as well as Republicans and Democrats in Congress, Exxon’s CEO Darren Woods said in an interview. “You see the opportunity and the appeal of this idea,” he said. “The question is, how do you put the concept into practice?”
Exxon said its proposal complements President Biden’s climate effort, but it would require the government to accept a price on carbon, which it has not done.
“The concept of a price for carbon is critical,” said Woods. “There has to be a way to incentivize investment.”
Offshore storage has already gained prominence in Europe, where governments have introduced carbon prices and legislators are more willing to spend taxpayers money on tackling climate change.
Mr Woods said carbon capture projects could be big business for Exxon around the world, given the right guidelines. “The potential for these markets is very, very big as the demand for decarbonising society continues to grow,” he said.