EPA approves Piñon CO2 sequestration plan

Piñon Midstream has received approval from the U.S. Environmental Protection Agency (EPA) for its monitoring, reporting and verification plan for the permanent sequestration of carbon dioxide in its two acid gas injection (AGI) wells at Piñon’s Dark Horse Treating Facility in Lea County, New Mexico.

Piñon said its Dark Horse Treating Facility is the largest AGI system that is currently permitted and operating in the state of New Mexico. Both of Piñon’s AGI wells—Independence AGI #1 and Independence AGI #2—are Devonian wells, reaching depths of approximately 18,000 ft. below the surface into rock formations located several thousand feet below water aquifers and existing Delaware Basin oil and natural gas producing formations.

The two AGI wells are permitted for a combined 20 million cubic feet per day (20 MMcf/d) of CO2 and hydrogen sulfide injection, which equates to ~250,000 metric tons of CO2 and ~110,000 MT of H2S annually based on current gas compositions. These two wells provide sequestration redundancy for Delaware Basin operators who use Piñon’s scalable and centralized treatment and sequestration facility to mitigate flaring and unlock valuable drilling inventory in the area.

Piñon’s approved plan, which became effective June 15, provides a full description of technical procedures for sequestration, monitoring, and verification that have been put in place at the Dark Horse Treating Facility to ensure permanent sequestration. The approved MRV plan also satisfies a major requirement for Piñon’s eligibility to receive 45Q and enhanced tax credits in accordance with the Inflation Reduction Act of 2022.

“Piñon was founded to create sustainable and scalable sour gas infrastructure solutions,” said Piñon’s Chief Executive Officer Steven Green. “Having now received both the MRV plan approval from the EPA and an NSR air permit from the State of New Mexico, and with our most recent capacity expansions up and running, we believe we are in position to become the Delaware Basin’s leading sour gas treating and carbon management provider,” Green said.

At its current operational rate, Piñon’s Dark Horse Treating Facility is projected to capture and sequester more than 190,000 MT of CO2 and 90,000 MT of H2S over the next twelve months.