LCM will support domestic oil production of 12,500 barrels per day, or 4.5 million barrels per year, through the sale of its CO2 for use in enhanced oil recovery (EOR) operations along the Gulf Coast

CO2 EOR is an important component of U.S. oil production, accounting for nearly 6% of U.S. onshore oil production, or 350,000 barrels a day nationwide. This technique uses CO2, both naturally occurring as well as a byproduct of industrial processes, to increase the production of oil from existing oil fields.

CO2-EOR works most commonly by injecting CO2 into already developed oil fields where it mixes with and “releases” the oil from the formation, thereby freeing it to move to production wells. CO2 that emerges with the oil is separated in above-ground facilities and re-injected into the formation. CO2-EOR projects resemble a closed-loop system where the CO2 is injected, produces oil, is stored in the formation, or is recycled back into the injection well.

1) Denbury resources investor presentation

1) Denbury resources investor presentation

While CO2 EOR is already an important component of today’s oil production, it has great potential to expand production. An analysis commissioned by the U.S. Department of Energy (DOE) projects potential oil resources recoverable with CO2 EOR of up to 137 billion barrels. This is the equivalent of over 50 years of the entire U.S. crude oil production at current rates.

EOR is an established, well-proven method of oil production, having been in use since the 1970s. CO2-EOR was pioneered in West Texas in 1972 as a way to sustain oil production in otherwise declining oil fields. CO2 is transported for EOR in more than 3,900 miles of CO2 pipeline infrastructure in the U.S. CO2 EOR can significantly extend the lifespan and revitalize production of mature oil fields in the United States.

The LCM project's use of EOR is a win-win for the environment and for U.S. energy independence: greenhouse gas emissions are reduced, and at the same time domestic oil production is increased, reducing dependence on foreign oil imports.

 
The potential impact of CO2 EOR is not so much a matter of whether but of when. The process works, there is plenty of residual oil in many reservoirs, and there is plenty of carbon dioxide available from a variety of sources.
— DOE Primer on CO2 Enhanced Oil Recovery