Over the past several weeks, three developments have brought the issue of Direct Air Capture (DAC) and Enhanced Oil Recovery (EOR) to the fore. In February, a new coalition known as the National Enhanced Oil Recovery Initiative (NEORI) presented a series of recommendations to the US Congress intended to spur greater investment in EOR (i.e., the practice of pumping CO2 into depleted fields to extract otherwise inaccessible oil--for more see Global Endorsement of CCS, Including EOR, 11/3/11). In March, journalist Marc Gunther published an excellent new e-book on the fledgling DAC industry titled Suck It Up, which included a detailed discussion of the links between DAC and EOR. This was followed by the high-profile Direct Air Capture Summit (DACS) organized by David Keith at the University of Calgary, where EOR again featured prominently as a topic of discussion and debate.
The issue with DAC and EOR derives from the fact that the dominant market for pure CO2 is for use by oil companies in EOR operations. DAC start-ups such as Carbon Engineering, Global Thermostat, and Kilimanjaro Energy seek to build machines whose primary output is pure CO2 scrubbed from the ambient air. As such, several of these firms are looking to supply oil companies with CO2 as an initial source of revenue as they develop more advanced and less costly DAC technologies. To critics, this looks like a "deal with the devil," insofar as it amounts to collaboration with the fossil fuel industry and will lead to GHG emissions that would not have occurred were it not for the additional oil recovered using CO2 supplied by DAC.
This view is both simplistic and impractical. The reality of DAC today is stated succinctly by Gunther: "air-capture technology has become a solution in search of a market, while its backers wait for the world to get serious about climate threat" (boldface original). And the reality of the CO2 market today is that it is dominated by demand for use in EOR--there are currently more than 100 EOR projects in operation paying $20-40 per ton of CO2, and the key constraint on future growth is lack of CO2 injectant supply. Like any other firm, for DAC start-ups to be successful they will need to be financially viable, and the surest road to financial viability in the foreseeable future is supplying CO2 to the EOR market. Other markets are either too small (for example, greenhouses) or too embryonic (algae-based biofuels), and support from the carbon allowance market is essentially nonexistent. Right now, EOR is the only meaningful game in town, and represents the only realistic option for DAC technology developers and their financial backers. To swear off involvement in EOR would deprive DAC of its most powerful motive force, and may well permanently consign DAC technology to the drawing-board.