Rod Nickel, Liz Hampton, and Nia Williams

(Reuters). North American oil-and-gas pipeline companies are preparing to compete in a budding market that moves greenhouse gases to carbon capture-and-storage (CCS) projects. This is done by creating new pipelines or renewing old ones.

    Utilities, chemical makers and oil refiners are counting on CCS to allow them to reduce atmospheric carbon emissions by burying them underground, to help them meet climate change goals.

    Few existing pipelines move carbon dioxide, and those that do mostly ship the gas to oilfields where it flushes out . This lack of existing pipelines could open the door to new lines or refurbishment of old ones for carbon transport.

According to a Princeton University 2021 study, the United States will require 19,000 km (11,806 mi) of carbon pipes to transport at least 65,000,000 tonnes annually by 2030 if it is to meet its net-zero goals to bury and utilize 1 billion tonnes each year.

“This is a real opportunity to (serve) the same customers we know, but in a new business line that until recently didn’t really exist,” said Scott Goldberg, a vice-president at pipeline operator EnLink Midstream (NYSE:).

    For now, there is little commercial reason to build. CCS can be profitable for many industrial emitters, but not enough tax credits or taxes on carbon emission.

Canada has carbon emitters that must pay C$50 a tonne. That figure will increase to C$170 in 2030. Canadian oil producers claim they need to be eligible for a tax credit in order to cover the 75% cost of CCS plants.

In 2026, the U.S. will increase its tax credit of 45Q for sequestering carbon by $50 per tonne. In a number of Congressional bills, the credit was proposed to rise to $85 per tonnes.

However, environmentalists are opposed to the construction of new carbon pipes and underground storage. They see CCS as prolonging the lives of industries that emit high levels of greenhouse gases, rather than paving the way for clean energy.

PRESSURE PROBLEM

Converting existing pipelines might be the best way to move carbon – however, this comes with technical problems.

According to Edouard Asselin (professor of materials engineering, University of British Columbia), carbon moves most efficiently through pipes at pressures of between 800 and 1,200 pounds per square inch (psi).

Asselin stated that to deploy natural gas lines, an operator must either pump carbon at a lower pressure or install expensive pipeline reinforcements every 500m, known as crack arrestors to deal with greater pressure.

The possibility of fracturing the pipeline is possible if you run at pressures higher than what was intended. Asselin stated that if the pipeline cracks underground, the pressure escaping could cause an explosion and threaten urban areas.

EnLink’s Goldberg, however, says that the conversion of existing pipelines to transport carbon is less expensive than creating new ones. Additionally, regulatory processes for converting lines have already been developed.

EnLink plans to use underutilized Louisiana natural gas lines for carbon transportation. Goldberg explained that the company aims at combining newer, more powerful pipeline segments with older, hydrotested pipes.

EnLink, for existing pipelines will transport carbon at lower pressure from refiners and other polluters to new pump stations. This will increase pressure through the new lines.

Some in the industry believe that new construction is needed. The majority of gas pipelines do not link the areas that can be used to sequester carbon. This is according to Colin Gruending, Enbridge Inc’s executive vice President for liquids pipes.

Wolf Midstream, Canada, is not converting old pipes but building new ones. It operates a C$326-million Alberta pipeline that delivers carbon for oil recovery, and in January said it would build a pipeline to move carbon from Archer-Daniels-Midland Co’s Iowa ethanol plants to a sequestration site about 350 miles away.

Jeff Pearson, the president of Wolf’s carbon business, stated that “we designed for very highpressure, much higher than most existing hydrocarbon pipes.” You would have to work hard to think of repurposing them.

Kinder Morgan Inc (NYSE:), which transports coal for oil recovery is in talks with Midwest emitters. Jesse Arenivas was president of Kinder’s Energy Transition Ventures unit. He also mentioned new pipelines that could move carbon for carbon sequestration and oil recovery.

Arenivas stated that “we believe there’s limited opportunity to reuse pipes over short distances.” We believe that long-haul will need new construction.