ExxonMobil's Carbon Sequestration Proposal and Emerging Alternatives

This week, ExxonMobil, a significant contributor to greenhouse gas emissions and historically resistant to climate regulations, proposed a substantial $100 billion initiative. The project, partially reliant on government funding, aims to sequester hundreds of millions of metric tons of carbon dioxide within geological formations located in the Gulf of Mexico.

A Contrast with Existing Carbon Capture Efforts

The ambition of ExxonMobil’s proposal is notable, yet it is juxtaposed with the progress made by smaller companies already actively engaged in carbon capture, storage, and utilization. These startups have demonstrated tangible milestones in their journey toward commercial viability.

Consider Charm Industrial, which recently completed a pilot program in collaboration with Stripe. This project successfully removed 416 tons of carbon dioxide equivalent from the atmosphere. While this amount is considerably less than the hundred million tons ExxonMobil envisions capturing, Charm has demonstrably achieved carbon sequestration – a key distinction.

Charm Industrial's Innovative Approach

Charm Industrial’s technology, independently verified by organizations like Shopify, Microsoft, and CarbonPlan, transforms biomass into an oil-like substance. This substance is then injected underground, resulting in permanent carbon dioxide sequestration, according to the company.

Looking ahead, Charm intends to utilize this bio-based oil equivalent for the production of “green hydrogen,” potentially replacing fossil fuels in industries still reliant on combustible energy sources.

Carbon Dioxide Utilization in Building Materials

Beyond biomass conversion, other companies are pioneering carbon dioxide utilization in different sectors. Firms such as CarbonCure, Blue Planet, Solidia, Forterra, CarbiCrete, and Brimstone Energy are actively incorporating captured carbon dioxide into building materials.

CarbonCure founder and CEO, Rob Niven, articulated the company’s goal: “to reduce 500 million tons per year by 2030.” He emphasized their pioneering role in utilizing CO2 as a cost-effective, value-added input in concrete production, ultimately boosting profitability.

CarbonCure, a joint winner of the $20 million carbon capture XPrize alongside CarbonBuilt, is not merely a theoretical solution. The company currently operates 330 plants globally, capturing carbon dioxide emissions and integrating them into building materials.

The Need for Both Utilization and Reduction

While carbon utilization is crucial for minimizing industrial emissions, achieving national climate objectives necessitates a dual approach. This involves a significant reduction in reliance on emissions-generating energy sources and the simultaneous, large-scale removal of existing greenhouse gases from the atmosphere.

Therefore, ExxonMobil’s proposal for a large-scale carbon sequestration project, while not inherently flawed, raises questions given the company’s history.

Gulf Coast Geological Potential and ExxonMobil's Perspective

The U.S. Department of Energy estimates that the Gulf Coast possesses geological formations capable of storing 500 billion metric tons of carbon dioxide – exceeding 130 years of total U.S. industrial and power generation emissions. ExxonMobil frames this as justification for maintaining its current business practices, with increased government subsidies.

Company executives, writing in The Wall Street Journal, are promoting a narrative that transitioning to renewable energy will negatively impact U.S. employment. However, research published in Scientific American suggests otherwise.

The Future of Employment in a Green Economy

According to Marilyn Brown and Majid Ahmadi, “With the more aggressive $60 carbon tax, U.S. employment would still exceed the reference-case forecast… Overall, 35 million job years would be created between 2020 and 2050, with net job increases in almost all regions.” This indicates that job losses in the oil industry would be offset by gains in energy-efficiency and renewable energy sectors.

Adapting to the Evolving Energy Landscape

ExxonMobil and other major oil companies have a role to play in the emerging energy economy. However, they cannot rely on past successes or maintain a “business-as-usual” approach. They risk facing a fate similar to that of the coal industry – gradual obsolescence and potential economic repercussions.

Carbon sequestration is a component of the solution, but it is just one tool among many that oil companies must utilize to remain viable and deliver value to shareholders. The focus should shift from managing the last 130 years of emissions to planning for the next 130 years, aiming for increasingly zero-emission operations.