The National Enhanced Oil Recovery Institute (NEORI) is calling for federal and state incentives to boost CO2 Enhanced Oil Recovery (CO2-EOR), leading to an estimated CO2 reduction of 4 billion ton and a quadrupling of oil production from EOR over the next forty years.
CO2-EOR works by injecting CO2 into existing wells to increase oil production and thereby helps to sustain production in otherwise declining fields of oil. The expansion of the technology is currently constrained by the limited supplies of CO2, which makes the use of CO2 captured from power plants and industrial facilities attractive not only for storage reasons.
NEORI, a coalition of industry, state officials, legislators and regulators, and environmental and labour leaders, recommend tax incentives for companies capturing and transporting the CO2, instead of the oil companies. A range of existing best practice policies encouraging commercial deployment of CO2-EOR in different US states has also been identified in order for them to be tailored and adopted by other states.
The Institute argues that the program will pay for itself within 10 years, through increased federal revenues from boosted domestic oil production giving an estimated net return of US$ 100 billion (€76 billion) over 40 years. The incentive would in addition reduce the US trade deficit by an estimated US$610 billion (€470 billion) over the same period by reducing oil imports.