California Resources announced a Carbon Dioxide Management Agreement or CDMA between Carbon TerraVault Holdco and Lone Cypress Energy Services an independent energy company focused on the development of low-carbon hydrogen generation facilities and energy infrastructure, to sequester 100,000 metric tons of carbon dioxide per annum from a newly constructed blue hydrogen plant at the Elk Hills Field in Kern County. Called the Lone Cypress Hydrogen Project, the project aims to be California’s first blue hydrogen facility producing 30 tons per day and has the potential to expand to 60 tons per day of blue hydrogen with up to 200,000 MT of CO2 sequestration per annum. Blue hydrogen is a net zero-carbon intensity fuel produced from natural gas. The CO2 generated during the methane reforming process is captured and will be stored permanently underground. "We are excited to be at the forefront of the energy transition in California. CRC is enabling the net zero energy economy by partnering with Lone Cypress to site a brand-new hydrogen facility at our Elk Hills Field as well as offering permanent CO2 sequestration through Carbon TerraVault," said Mac McFarland, CRC’s President and Chief Executive Officer. "Because capture and compression are built into the project development, we anticipate limited capital requirements from the CTV JV and EBITDA per metric ton within our previously stated range. This CTV storage project is a meaningful step forward in CRC’s rollout of carbon capture and sequestration technology across the state and is the first of, what we believe, will be many projects to come. We are also excited about the ability to leverage our Elk Hills asset to create a Net Zero Industrial Park by combining green field development and carbon sequestration." The CDMA frames the contractual terms between parties by outlining the material economics and terms of the project and includes conditions precedent to close.
Published first on TheFly
