Article from: OGEL 3 (2023), in Editorial
Although climate models differ, there is consensus on this one point: carbon removal will be necessary to keep global temperatures at or below 2 degrees more than pre-industrial levels. Currently, geologic sequestration is the best technology available to guarantee permanent removal of CO2 from the atmosphere. A close look at nation climate plans and the mitigation pathways put forth for meeting international emissions reduction goals reveals a vision for the transformation of the oil and gas, energy, and industrial sectors. By 2030, these plans envision a net-zero or net-negative energy sector where electricity generation and transportation fuels, including hydrogen and bioenergy as well as oil and gas, are decarbonized using carbon capture and storage.
This area of law is rapidly evolving, with countries globally moving to enact new laws and regulations related to CCUS. Since the initial call for papers for this special edition was announced, the United States EPA has released draft regulations which would mandate CCUS with 90% or greater efficiency at the majority of existing and new fossil-based generating stations nationwide. Meeting this goal would not only require installation of capture facilities at hundreds of power plants but would also require construction of thousands of miles of kilometers of new carbon dioxide pipelines and development of hundreds of thousands of acres of subsurface sequestration facilities. Power plants that are unable to meet this requirement would be required to retire. Regulations like these present an existential mandate to the existing fossil energy industries: decarbonize or decommission.
The paramount importance of CCUS as a carbon removal technique has also been recently endorsed on the other side of the Atlantic. Following up to the 2021 European Commission's Communication on sustainable carbon cycles, In November 2022 the European Union (EU) released a full-fledged certification framework for carbon removals to foster the economic viability of CCUS projects. These and other initiatives envision CCUS as a key bridging technology to obtain long-term climate mitigation targets under the European Green Deal. Moreover, CCUS infrastructures are promoted as a cornerstone of the EU Green Deal Industrial Plan as a stimulus package to foster transformative changes towards decarbonisation of the European industrial sector and economy while increasing competitiveness and self-sufficiency.
Mobilizing the resources necessary for such an expansion presents a challenge, and opportunity, that has rarely been seen before such that projects like the development of the transcontinental railroad or the interstate system seem modest in comparison. Oil and gas and energy companies are uniquely positioned to meet this challenge. The oil and gas industry has been transporting and injecting carbon dioxide for enhanced recovery and waste disposal purposes under existing regulations within national laws for decades. This expertise, and the expertise developed within governmental oil and gas regulatory bodies, will be critical to geologic characterization and the safe and sustainable regulation and management of storage projects. It is through that lens that this special issue was envisioned.
The articles in this special issue provide a snapshot of the current state of law relating to carbon sequestration internationally. Europe and North America currently have the most developed legal frameworks for geologic carbon sequestration and, as a result, the majority of the articles herein are focused on those jurisdictions.
The first group of papers in this issue evaluate the frameworks in place for the regulation of sequestration projects. Professor Anderson's article, Carbon Sequestration: A Fresh Look at an Essential Tool in the War on Climate Change, starts the issue with an examination of the research detailing the need for carbon sequestration, as well as an overview of key legal developments internationally and in Texas and Louisiana, including regarding pore space ownership and the cooperative federalism structure for regulation of injection wells. Dickens and Pollet, follow this trend with a dive into Carbon Transportation and Sequestration in the Submerged Lands of the United States Gulf of Mexico. Their piece plunges into the details regarding the ownership of the non-mineral subsurface in submerged lands and an evaluation of some of the first state grants of carbon injection leases for offshore lands. Ombudstvedt and Koperna then compare the US framework to the frameworks that have developed in Norway and the European Union, demonstrating that, although it may seem like Comparing Apples and Oranges, the regulatory frameworks are based on a common set of objectives and rely on similar mechanisms related to assuring permanence and protection of public health and the environment.
A second grouping of papers focuses on challenges associated with regulatory and land fragmentation and development of transboundary projects. In her piece, The Space Between Us, Lewis looks at the challenges resulting from property and regulatory fragmentation associated with transboundary projects in the United States. These themes are further explored in Ombudstvedt, Ostgaard, and Prasad and in Mittler. In Playing Nice in the Sandbox, Ombudstvedt, et. al, emphasize the international dimension of many projects and the legal frameworks and formal procedures that exist to support development of such projects. Mittler examines similar questions in Navigating Uncertainties with respect to maritime transportation of carbon dioxide. Notably, both pieces extensively discuss the London Protocol and its importance as a mechanism to encourage cooperation and assure that projects are developed with consistent minimum regulatory requirements despite variances within local law. Ombudstvedt, et al, put forth technical standards developed by the International Organization for Standardization as one possible mechanism for regulatory harmonization as well as international cooperation and capacity building.
The issue also offers a preview of the opportunities for CCUS and the need for legislative frameworks in Africa and South America. Where a remarkable share of oil and gas infrastructures are located in the African continent, developments in the uptake of CCUS techniques still face considerable obstacles. Two articles in this edition address the current opportunity and legal frameworks for sequestration in Nigeria. In Sustainable pathways to balancing decarbonization in the face of fossil energy dependence, Ezekiel and Dimowo chart the still untapped potential of CCUS to decarbonize the hard-to-abate industrial activities such as iron, steel, cement and chemicals production while advocating for a broader, pan-continental strategy for carbon removals. Noting that Nigeria does not yet have a CCUS policy or a regulatory framework for CCUS, Oniemola evaluates whether Nigerian common law is robust enough to address potential liabilities arising from capture activities. In Considering Carbon Capture and Storage for the Nigerian Petroleum Industry: Is a Complementary Liability Regime Required? he advocates for enactment of a comprehensive liability regime for carbon capture, including requirements for insurance, to assure protection of communities and the environment.
Notwithstanding that one of the largest EOR-related sequestration projects in the world is located in Brazil, absent or underdeveloped regulatory frameworks present an obstacle to CCUS in parts of the South American continent as well. There, relevant economic and political issues may hamper the establishment of a stable regulatory environment to attract investment. Rueda and Polesello unpack the above conundrum by analyzing the specific case of the Vaca Muerta reservoir in Argentina. Argentina is extensively reliant on hydrocarbons both energetically and economically. Yet the development of a specific legal regime on CCUS is only at its infancy. In Argentina's Opportunity Is Pending New Regulation, the main tenets of a future Argentinian framework law addressing the complex CCUS value chain in order to ensure regulatory stability and, consequently, bankability of CCUS projects are outlined. Importantly, streamlining of permitting procedures and categorisation of CO2 as a commodity instead of waste are among the key conducive elements of such a future conducive regime.
The articles in this Special Issue underscore how CCUS technologies are increasingly becoming a reality in the global strive for the decarbonisation of the economy to achieve the UNFCCC Paris Agreement goals. Yet to deliver on such ambition, remarkable efforts are required to adopt mature, conducive and holistic legal regime able to provide correct market signals, remove procedural barriers and ensure stakeholders buy-in for CCUS projects across all continents. Through these articles at least three main themes emerge, which can also provide relevant insights for further legal research in the field. First, the actual development of CCUS projects on the ground is largely behind schedule despite being urgently needed. The reasons for such backslide are multiple and various across continents and legal systems. Second, and related to the first, in several developed and developing countries the lack of a proper legal framework for carbon sequestration as a precondition to provide a conducive regulatory environment for investments is a major barrier. On the one hand, CCUS developments operate within an environment of regulatory experimentation, which demands flexibility, innovation, and transparency. On the other hand, the financial risks still present in such infrastructures call for a stable and predictable regulatory environment, in order to mitigate political and regulatory risks. Finally, international cooperation both among sovereign States and between industry and governments is a key element to both enable information sharing, partnerships and good governance structures with a view to develop a consistent and robust regulatory response to the multitude of challenges posed by carbon sequestration.
 Jenny G. Vitillo et al., The Role of Carbon Capture, Utilization, and Storage for Economic Pathways That Limit Global Warming to Below 1.5°C, 25 Science 104237, X (May 20, 2022), https://www.sciencedirect.com/science/article/pii/S2589004222005077 [https://doi.org/10.1016/j.isci.2022.104237].
 Sona Patel, Nuclear, Hydrogen, CCUS Part of at Least 42 Country Ambitions, Power Mag., (June 1, 2022), https://www.powermag.com/nuclear-hydrogen-ccus-part-of-at-least-42-country-ambitions/.
 IPCC Working Group III, Contribution to the Sixth Assessment Report of the IPCC, Climate Change 2022: Mitigation of Climate Change X (Shukla et al eds., 2022) [hereinafter IPCC AR6 WGIII].
 88 FR 33240. 88 Fed. Reg. 33,240, XX,XXX (May 23, 2023) (to be codified at 40 C.F.R. § 60).
 Communication from the Commission to the European Parliament and the Council on Sustainable Carbon Cycles, at X, COM (2021) 800 final (Dec. 15, 2021).
 Proposal for a Regulation of the European Parliament Establishing a Union Certification Framework for Carbon Removals, COM (2022) 672 final (Nov. 30, 2022).
 Proposal for a Regulation of the European Parliament and of the Council on establishing a framework of measures for strengthening Europe's net-zero technology products manufacturing ecosystem (Net Zero Industry Act) COM (2023) 161 final (July 25, 2023); Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, A Green Deal Industrial Plan for the Net-Zero Age, COM (2023) 62 final (Jan. 2, 2023).
 Int'l Energy Agency, Net Zero by 2050: A Roadmap for the Global Energy Sector, at 79-80, 94-99 (2021), https://iea.blob.core.windows.net/assets/deebef5d-0c34-4539-9d0c-10b13d840027/NetZeroby2050-ARoadmapfortheGlobalEnergySector_CORR.pdf.
 The largest operational sequestration projects in the world are Petrobras' project in the offshore Lula oilfield, Equinor's Sleipner project, and Exxon's acid-gas disposal operations at Shutte Creek, Wyoming. Onshore CO2-EOR operations in the United States began more than 50 years ago in the Permian Basin. See, Glob. CCS Inst., Global Status of CCS 2022, https://status22.globalccsinstitute.com/wp-content/uploads/2022/10/Global-Status-of-CCS-2022-Report-Final-compressed.pdf.