De-risking the well permitting process for CCUS projects

Some factors will stop a project in its track before it even gets off the ground. These can be as simple as being sited too close to a fault. A poor cement job in an offset well could be another dealbreaker for a project to advance. Understanding and scanning for any immediate factors that will cause your application to be rejected will save you time and investment.

Countless studies contribute to the permit application. The EPA has a checklist of criteria for Class VI well permit applications that includes the various studies and data requirements. You will want to complete these in advance, but in line with the permitting application. If all studies have not been completed upfront, there may be an opportunity to do them ad hoc if you are working with a consultant who has the capabilities to complete them.

Debatably the most fundamental part of the permit application is how you manage the process. The time and resources required to undertake the permitting application is substantial. On average, it could take up to a year to complete the requirements to submit the application. If the process is not managed properly, steps could be skipped, and an incomplete application will cause inevitable delays. Working with a consultant who understands all the technical aspects of the application, the regulatory components and knows how to get it done, will simplify and guide you through the process. This coupled with a strong administration team with a quality management system will set you up for success. 

The largest portion of the permit is sub-surface evaluations. Some of the technical sub-surface considerations that help form a solid application include evaluating well construction for wells within the area of review, creating sub-surface maps, identifying faults and fractures, detailing geochemistry and geomechanics of the site, compiling seismic data and modelling the reservoirs. Using the same sub-surface team to complete your permit application ensures the right information is fed into the final permit application document. 

Stakeholder engagement is a critical piece of any carbon capture and storage project and can often be one of the biggest roadblocks to advancing a project.  Engaging the public through authentic, honest conversations on the cost of the energy transition, the effects of inaction and the need for infrastructure to reduce these emissions is of the utmost importance. Stakeholders must understand why the project is occurring, how it will happen and the benefits and risks. The two-month public comment period is required as part of the application. However, proactive and early engagement is a best practice to help ensure a positive outcome. Each project is unique.  Thoughtful consideration into the timing of public engagement is paramount. More information on Securing social acceptance to succeed can be found here. 

Work together collaboratively with regulators throughout the permitting application process. Engaging regional EPA staff as early as possible and keeping in touch with them regularly can help detect common issues with applications and anticipate additional requirements, helping your application to stay on schedule. Working with a team who has strong existing relationships with regulators allows you to be proactive with communications.

There is a sequence of various permits to undertake depending on where your project is located. It’s necessary to establish permitting pathways and understand the most efficient order to complete them. The California Environmental Quality Act (CEQA) and Environmental Impact Assessments are two examples of additional permits that projects may need to obtain. There can also be additional requirements to Class VI permits based on region, such as the newly introduced Louisiana House Bill No. 571 which requires an environmental analysis as part of the permit made to the conservation commissioner under the state Department of Natural Resources and requires that local governments are notified when a permit is filed that would impact their parish. Having a consultant with a strong geographic presence across varied regions helps you understand regional permitting applications needed as part of the EPA application.

Robust cost estimating and economics modeling allows clear distinction between subsurface costs, CO2 capture and transportation costs, and the project’s ability to pay royalties and returns to the operator. Importantly, are cost estimates appropriate and procedures in line? Part of the application involves proving financial assurance - having funds available in your account and in escrow to account for site remediation costs. Providing a bond to the regulator assures the materials brought into the plant and stored can be remediated and the site can return to its original state in the event of shutdown.

The application phase isn’t complete once you click submit. The EPA requires time to review and approve applications. Once the application is complete, revisions will inevitably be made. Even the strongest of applications likely won’t escape without comment; the stronger your application, the quicker the process.  Leave additional time and resources to respond to questions or comments, pull additional data and engage with the public.