Hannah Grover, Farmington Daily TimesPublished 5:40 p.m. MT April 27, 2020

AZTEC — The New Mexico Institute of Mining and Technology is receiving approximately $17.5 million of U.S. Department of Energy funding to study safe storage of carbon dioxide in underground saline reservoirs near the San Juan Generating Station.

In addition, the funding also includes more than $4.4 million of non-DOE funds. The non-DOE funding does include some funding from Enchant Energy as well as NM Tech funds. Enchant Energy will provide about more than $1 million in a combination of cash and in-kind work, according to Chief Operating Officer Peter Mandelstam.

The data obtained will be used to prepare, submit and obtain a permit to construction a Class VI well. The total project will cost nearly $22 million.

The well is intended to store carbon dioxide captured from the power plant if Enchant Energy successfully retrofits San Juan Generating Station with carbon capture technology.

A class VI well is not the only well that can store carbon dioxide. Robert Balch, the director of the Petroleum Recovery Research Center at New Mexico Tech, said there are hundreds of wells in New Mexico currently used for carbon dioxide injection. Those are class II wells, which are set aside for byproducts of hydrocarbon production.

Balch said getting a permit for a Class VI well is a more stringent process that requires a lot of science and has special building requirements. The Class VI wells are intended to store carbon dioxide in a safe and secure manner for at least 990 years.

“You can always take CO2 from a plant and put it into the ground somewhere,” Balch said.

He said this can be done through enhanced oil recovery, however having the Class VI well will give Enchant Energy a buffer storage system that will allow the plant to continuously run.

Within a year, Balch said NM Tech hopes to have an exploratory well drilled and researchers will take rock samples. This will allow them to test how injecting carbon dioxide will impact the geology. The researchers will also look at the rocks above and below the saline aquifer where they plan on injecting the carbon dioxide.

According to the department of energy’s announcement, six to seven million metric tons will be captured from the power plant each year and 2 million metric tons will be stored at a well site approximately 20 miles from the power plant. The remaining four to five million metric tons of carbon dioxide will be sent to the Permian Basin for use in enhanced oil recovery.

In order for Enchant Energy to access the higher tax credits, an injection well must have its design completed by the end of 2022.

The carbon capture front-end engineering and design study for retrofitting the power plant with Mitsubishi Heavy Industry’s KM CDR Process for carbon capture has previously received funding from the department of energy.

Mandelstam said his company, as well as its partners the City of Farmington and NM Tech, are proud to have won the cooperative funding agreement and the award provides further evidence of the project’s viability.

Permanent storage, or sequestration, of carbon dioxide in underground reservoirs will allow Enchant Energy to access higher amounts of tax credits, however Enchant Energy will not receive money from the sale of that carbon dioxide. Mandelstam acknowledged that the company would make more money by selling the carbon dioxide based on current projections than it will make through storage. However, he said sequestration is the best thing for the environment.

“What we care about is New Mexico jobs and economic development,” he said.

He said development of sequestration wells would lead to job creation and help the economy in San Juan County.

In terms of the environment, Mandelstam said the ability to store large amounts of carbon dioxide economically in underground reservoirs would be a potential game changer in the fight against climate change.

“It’s a win for the State of New Mexico in just about every way you could think of,” Balch said about the proposal to retrofit the power plant with carbon capture technology

He said the retrofit will preserve jobs and allow for economic development while also helping the environment.

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