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Oxy invests in new large CO₂ source for Permian basin EOR

Oil & Gas Journal

By OGJ editors
HOUSTON, July 3 -- Occidental Petroleum Corp. with its agreement with SandRidge Energy plans to increase substantially the amount of carbon dioxide available in the Permian basin for use in enhanced oil recovery projects.

The CO₂ will come from Oxy's planned gas processing plant to be built in Pecos County, Tex.

Oxy expects the additional CO₂ will allow its projects in the area to increase production by at least 50,000 bo/d in the next 5 years.

Oxy Chairman and Chief Executive Officer Ray R. Irani said the project will provide at least 3.5 tcf of CO₂ for Oxy's long-term use in EOR projects and develop about 500 million bbl of oil reserves from currently owned assets at an attractive cost.

Oxy will own and operate the new facilities and will invest about $1.1 billion in their development.

The planned gas processing plant has an expected 450 MMcfd of CO₂ takeaway capacity, and Oxy expects to receive another 50 MMcfd of CO₂ from existing SandRidge gas processing plants. The project also includes construction of a 160-mile pipeline from the plant, through McCamey, Tex., to the industry's CO₂ hub in Denver City, Tex.