Carbon

Depressed wholesale natural gas and power prices, along with the prospects for curbing emissions to meet anticipated future carbon constraints, combined to drive down earnings in the fourth quarter for Edison International’s independent energy unit, Edison Mission Group (EMG), the parent company reported Monday as part of a conference call on its year-end 2008 earnings, which were up 4% over the previous year. Prospects for EMG this year are not much better, according to Edison CEO Ted Craver, speaking to analysts.

Oklahoma City-based SandRidge Energy Inc. and Occidental Petroleum Corp. plan to build and operate a West Texas carbon dioxide (CO2) extraction plant and pipeline that is expected to boost Occidental’s Permian Basin oil production by at least 50,000 b/d and Sandridge’s production of high-CO2 natural gas to 350 MMcf/d (260 MMcf/d net). Occidental will put up the $1.1 billion in development costs, own and operate the facilities and claim 100% of the CO2. The Century Plant in Pecos County, TX, combined with existing SandRidge CO2 processing plants, would allow treatment of approximately 1 Bcf/d of high-CO2 gas by year-end 2011. The CO2 takeaway capacity is expected to be at least 450 MMcf/d. SandRidge would drill, produce, and deliver high-CO2 gas to the Century Plant and retain 100% of the methane gas at the tailgate under a 30-year agreement. The Oklahoma company expects the facility also will enable it to develop 1.7 Tcf of additional methane reserves from high-CO2 gas. The company currently has the capability of producing 70 MMcf (50 MMcf net) per day of methane from high-CO2 gas. Occidental also plans to build pipelines from McCamey, TX, to Denver City, TX, to deliver the CO2 to its enhanced oil production facilities.

Oklahoma City-based SandRidge Energy Inc. and Occidental Petroleum Corp. plan to build and operate a West Texas carbon dioxide (CO2) extraction plant and pipeline that is expected to boost Occidental’s Permian Basin oil production by at least 50,000 b/d and Sandridge’s production of high-CO2 natural gas to 350 MMcf/d (260 MMcf/d net), the companies said.

ExxonMobil Corp. has been ordered to curb the carbon dioxide (CO2) emissions from its Shute Creek natural gas processing facility near LaBarge, WY, and redirect the emissions into pipelines for enhanced oil recovery under a resolution passed by the Wyoming Oil and Gas Conservation Commission. The commission wants the oil major to submit progress reports detailing progress in marketing the CO2 vented from the facility, which is produced in association with sour gas production. ExxonMobil sold an average of 207 MMcf/d of CO2 last year for enhanced oil recovery, but it vented another 181 MMcf/d of CO2, according to the commission. Under the order, ExxonMobil may be forced to secure interruptible customer contracts for CO2 delivery. “They recognize what we have no argument with: That is, there are hedging opportunities in the CO2 market,” ExxonMobil spokeswoman Sara K. Tays told the Casper Star-Tribune in Wyoming. “The goal is to safely market everything you can.” With oil and gas prices soaring, Wyoming officials said they want to help producers secure flows of CO2, which may be injected into maturing fields to extract volumes that were unrecoverable through conventional production methods.

Strong performances from natural gas pipeline, carbon dioxide (CO2) and terminals business segments helped Kinder Morgan Energy Partners (KMP) achieve its best quarter ever in 1Q2008, with earnings hitting $685 million, up 36% from $503 million in 1Q2007, the company said.

Strong performances from natural gas pipeline, carbon dioxide (CO2) and terminals business segments helped Kinder Morgan Energy Partners (KMP) achieve its best quarter ever in 1Q2008, with earnings hitting $685 million, up 36% from $503 million in 1Q2007, the company said.

Warren Resources Inc. and Double Eagle Petroleum are moving ahead with drilling plans in the Atlantic Rim play in Carbon County, WY after the Bureau of Land Management’s (BLM) appeals board rejected pleas to stay the agency’s approval of a drilling plan for the area.

Warren Resources Inc. and Double Eagle Petroleum are moving ahead with drilling plans in the Atlantic Rim play in Carbon County, WY after the Bureau of Land Management’s (BLM) appeals board rejected pleas to stay the agency’s approval of a drilling plan for the area.

Looking very similar to a carbon copy of the previous day’s market, prices fell at a large majority of points (most often by double digits) Tuesday, with the firming exceptions occurring at a few Rockies points. The same influences remained in play: a lack of substantive cooling load for gas in many areas and a continuing slide by August futures.