The carbon capture, utilization and storage (CCUS) industry has experienced a surge in project announcements, but many of these projects have experienced delays or cancellations. A range of factors, such as regulatory environments, resource quality, and technology readiness, play crucial roles in determining whether a CCUS project succeeds or fails. Understanding these key factors will help to benchmark the influx of announcements and determine which are most likely to be built. To do this, EIR has developed a project viability index (PVI) leveraging our extensive datasets and detailed CCUS project tracking. The PVI is determined on a project specific basis by accounting for the current project status as well as evaluating metrics in three key categories, asset quality, innovation ecosystem and supportive partners, for each component of the CCUS value chain – capture, transportation and storage.
Figure 1 showcases the top 20 operators with the highest ranked PVI by project count. As shown in Figure 1, projects in more favorable regions where regulatory support is robust and resource quality is strong, such as TX and LA, tend to have higher PVI scores. However, these projects still face risks, such as pipeline construction delays, pore space ownership uncertainty and lack of emitter partnerships due to high costs of capture. These factors are captured through the other metrics considered in our PVI to give each project a unique score based on project specific information.
Research Highlights
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- BP to Divest U.S. Onshore Wind Assets – Repowering Upside for the Right Buyer – What is the potential market value of BP’s U.S. onshore wind assets which will be up for sale?
- Gevo Acquires Red Trail Energy – Come Fly With Me – This Deal Insight examines Gevo, Inc’s. recent $210 million acquisition of Red Trail Energy’s 65 million gallon per year ethanol facility in North Dakota equipped with carbon capture and an approved Class VI well that is actively sequestering 160,000 tpa of CO2 with the capacity to scale to 1 mtpa. The analysis covers CCS asset valuation, including subsurface analysis, and the potential of environmental attribute stacking pathways that have been unlocked through this transaction.
- Tracking the Energy Transition Market – Fed Coming to the Rescue for Highly Levered Names – The 2Q24 edition of the ETR team’s equity tracking report provides coverage across various energy transition sectors as well as integrated traditional energy businesses.
About Enverus Intelligence®| Research
Enverus Intelligence® | Research, Inc. (EIR) is a subsidiary of Enverus that publishes energy-sector research focused on the oil, natural gas, power and renewable industries. EIR publishes reports including asset and company valuations, resource assessments, technical evaluations and macro-economic forecasts, and helps make intelligent connections for energy industry participants, service companies and capital providers worldwide. EIR is registered with the U.S. Securities and Exchange Commission as a foreign investment adviser. Click here to learn more.
