EPA Issues First Carbon Sequestration Permit in Texas to Occidental Petroleum

Occidental Petroleum receives Texas' first carbon sequestration permit from EPA to inject CO2 in Permian Basin, marking a milestone in climate change mitigation efforts

The US Environmental Protection Agency (EPA) has issued Texas’ first ever permit for carbon sequestration to Occidental Petroleum (OXY). The US EPA granted a Class VI permit. This allows Occidental to inject and store carbon dioxide in oil wells in Ector County within the Permian Basin.

New Carbon Sequestration Project in Texas

Oxy Low Carbon Ventures (Occidental’s subsidiary), will be driving three wells to inject up to 8.5 million metric tons of CO2. The project is part of the Stratos Direct Air Capture venture, which is collaborating with asset manager BlackRock.

By injecting CO2 into deep underground wells, the process can prevent the harmful gas from entering the atmosphere. This helps in mitigating climate change.

Political and Economic Impacts

As of recently carbon sequestration has become a cornerstone of the US strategy to address climate change. Under Joe Biden’s tenure, the 2022 Inflation Reduction Act allocated billions in subsidies for CCS projects. However, the future of these tax credits remains uncertain, as some political leaders, particularly Republicans, aim to reduce federal support for carbon capture technology.

During the Trump administration, the EPA stressed that such projects can generate high-paying jobs while guaranteeing environmentally friendly operations. This has generated much interest in carbon storage projects, particularly in Texas, where there are 43 projects waiting to be approved at the federal level.

Environmental Concerns and Risks

While carbon sequestration promises to be a powerful tool in fighting global warming, the method is not without controversy. Some experts worry that injecting CO2 into the ground could cause environmental issues like earthquakes and well blowouts. Texas, in particular, has struggled with wastewater disposal in the Permian Basin, heightening concerns about the potential for seismic activity.

The EPA will likely need to balance regulatory oversight with continued support for carbon storage initiatives. If handled carefully, these projects could play a significant role in reducing global emissions while addressing climate change.