§15910 Enhanced Oil and Natural Gas Production Through Carbon Dioxide Injection

Summary

Encourages using captured carbon dioxide and similar gases to push more oil and gas out of federal lands and to store carbon dioxide underground. The Interior Secretary must start a rulemaking to lower royalties for leases that use CO2 injection if it helps those goals and the public interest. The Secretary must publish an advanced notice within 180 days after August 8, 2005, and finish the rulemaking within 365 days after August 8, 2005. A lease can qualify if it is on the outer Continental Shelf or onshore federal land, plans to use CO2 injection for enhanced recovery, and contains oil or gas unlikely to be produced without the royalty cut. The royalty suspension for each eligible lease can cover up to 5,000,000 barrels of oil equivalent for production on or after the advanced notice. The Secretary may limit reductions based on market price, and the rule applies to leases issued before, on, or after August 8, 2005. The Energy Secretary must run a competitive grant program for CO2 injection projects to boost recovery and store CO2. The program can fund up to 10 projects in the Williston Basin (North Dakota and Montana) and 1 in the Cook Inlet Basin (Alaska). Applicants must describe the project, expected production gain and how long it will last, estimated CO2 sequestered, plans to share data, cost and sustainability plans, and which costs federal money would cover. Selection will favor experienced teams that promise cost-effective production, large sequestration of CO2 from human sources, strong funding commitment, and low environmental harm. No applicant can receive more than $3,000,000; cost-sharing is required. Work must start within 2 years after the grant or by December 31, 2010, and grants cannot run more than 5 years. The Energy Secretary must publish a request for applications within 180 days after August 8, 2005, accept applications for 180 days after that notice, and share lessons learned among participants. The Interior’s Bureau of Land Management must keep records of CO2 stored on federal leaseholds. Money may be appropriated as needed to carry out these actions.