Buzz around the Bend

PLUS: NYT geothermal report, Duke's methane monitoring, Redwood Materials $1bn raise

Author

Sunya Scoop
August 29, 2023

Good Morning. This is the Sunya Scoop. The newsletter that takes energy transition news and turns it into an easy-to-read email for you.

Here’s what we have for you today:

  • Equinor acquires 25% stake in Bayou Bend CCS LLC, a major US carbon capture and storage project in Southeast Texas, from Texas Carbon 1 LLC, a subsidiary of Carbonvert.

  • Equinor aims to develop 15-30 million tonnes of CO2 transport and storage capacity annually by 2035.

  • Bayou Bend CCS project aims to be one of the largest CCS solutions for industrial emitters in the US.

  • Project has nearly 140,000 gross acres for permanent CO2 sequestration and potential storage of over one billion metric tons.

  • Acreage includes 100,000 acres onshore in Chambers and Jefferson Counties, Texas, and 40,000 acres offshore Beaumont and Port Arthur.

  • Chevron, Talos Energy, and Equinor form a joint venture for Bayou Bend, with Chevron as operator (50%), Talos (25%), and Equinor (25%).

  • Project's location near Houston Ship Channel offers decarbonization potential for industries like refining, cement, steel, and manufacturing.

  • Equinor's involvement enhances the joint venture's commitment to cost-effective carbon solutions and economic growth.

  • Industrial emissions in Texas Gulf Coast region estimated at around 100 million metric tonnes of CO2 yearly.

Dozens of geothermal companies have emerged with ideas.

Fervo is using fracking techniques — similar to those used for oil and gas — to crack open dry, hot rock and inject water into the fractures, creating artificial geothermal reservoirs. Eavor, a Canadian start-up, is building large underground radiators with drilling methods pioneered in Alberta’s oil sands. Others dream of using plasma or energy waves to drill even deeper and tap “superhot” temperatures that could cleanly power thousands of coal-fired power plants by substituting steam for coal.

Still, obstacles to geothermal expansion loom. Investors are wary of the cost and risks of novel geothermal projects. Some worry about water use or earthquakes from drilling. Permitting is difficult. And geothermal gets less federal support than other technologies.

  • Two teams are trying to tap that hot granite using enhanced geothermal. One is Utah FORGE, a $220 million research effort funded by the Energy Department. The other is Fervo, a Houston-based start-up.

  • FORGE announced it had successfully sent water between two wells. Two weeks later, Fervo announced its own breakthrough: A 30-day test in Nevada found the process could produce enough heat for electricity. Fervo is now drilling wells for its first 400-megawatt commercial power plant in Utah, next to the FORGE site.

  • In Texas, Sage Geosystems is pursuing fracked wells that act as batteries. When there’s surplus electricity on the grid, water gets pumped into the well. In times of need, pressure and heat in the fractures pushes water back up, delivering energy.

  • Oil and gas companies have taken a further interest in geothermal: Devon Energy invested $10 million into Fervo, while

  • BP and Chevron are backing Eavor.

  • Nabors, a drilling-service provider, has invested in GA Drilling, Quaise and Sage.

  • Duke Energy's Integrated Methane Monitoring Platform Extension project receives $1 million funding from the U.S. Department of Energy's Office of Fossil Energy and Carbon Management.

  • The company's methane monitoring platform has reduced leaks by over 85% since 2022 using advanced technologies.

  • The extension project aims to expand methane emissions monitoring to interstate and customer natural gas assets.

  • Collaboration with Williams, involving innovative ground-based, aerial, and satellite emissions tools.

  • Project supports Duke Energy's goal to achieve net-zero methane emissions by 2030 for its operations and by 2050 for natural gas purchases upstream and sold downstream.

  • Methods include using satellites, UAVs, light detection and ranging, gas cloud imaging cameras, and handheld analyzers.

  • Data analysis will inform the Integrated Methane Monitoring Platform's deployment plan.

  • Duke Energy is also investing in renewable natural gas (RNG) and carbon offsets to reduce emissions.

  • Redwood Materials secures over $1 billion in new funding for expansion in the US.

  • Founded by former Tesla executive JB Straubel.

  • Received a conditional commitment for a $2 billion loan from the US Energy Department in February.

  • Aiming to build a $3.5 billion recycling and re-manufacturing complex in Nevada for EV battery materials.

  • Funding round co-led by Goldman Sachs Asset Management, Capricorn's Technology Impact Fund, and funds advised by T. Rowe Price Associates.

  • Series D funding will be used to increase capacity and expand the domestic battery supply chain.

  • Partnership with Panasonic for battery materials, which collaborates with Tesla for battery cell production in Nevada.

Oil use is expected to decline significantly in personal transportation but will remain essential for the industrial processes and heavy-duty transport like shipping, long-haul trucking, and aviation that underpin economic growth. Consider: If every new passenger car sold in the world in 2035 were an electric vehicle, oil demand in 2050 would still be 85 million barrels per day, the same as it was around 2010.

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.