2019 a 'critical' year for Project Tundra
Project Tundra could make huge strides in 2019, MinnKota Power officials said.
The project seeks to build a carbon-capture unit in North Dakota at MinnKota Power's existing Milton R. Young Unit 2 plant near Center, N.D. Project Tundra could potentially capture up to 95 percent of the plant's carbon emissions. This CO2 could then be used for enhanced oil recovery or stored in rock formations underground.
Stacey Dahl, senior manager of external affairs for MinnKota, told the Herald this week that "2019 is a very critical year."
"Our business case needs to be developed," Dahl said. "We will have completed our research and development phase and we would be in a position to make a decision on what's to happen going forward with the project. We'll be at a point where we can decide whether or not to construct."
In the coming weeks, Dahl said MinnKota will be applying for a Department of Energy grant for $15 million.
MinnKota was previously awarded a matching grant by the state of North Dakota. If the federal funds come through, Dahl said, the state will match, giving the project a total of $30 million to study design of the plan.
This funding opportunity will come out in the next few weeks, Dahl said, and Minnkota will have 60 days to apply. Dahl estimates Project Tundra will cost between $1.3 billion and $1.6 billion in total and be fully constructed by 2025.
MinnKota is still ironing out details of the business plan and how to fully fund the project.
The technology needed for this project is already commercially available, Dahl said. Researchers just need to determine if the project will adapt to the cold North Dakota environment.
Carbon dioxide produced from Project Tundra will only fit with traditional vertical oil fields, but could be adapted for new wells in the future as there is "significant amount" of research to develop that application, Dahl said.
Work in the Legislature
With the Legislature back in session, the Lignite Energy Council is working to make sure state policy will create a friendly environment for Project Tundra, said President and CEO of the Lignite Energy Council Jason Bohrer.
The council will propose a bill this session, he said.
"A potential bill would say 'if you use carbon dioxide from a power plant for enhanced recovery, it should have a greater incentive than if you use carbon dioxide from a natural source,'" Bohrer said. "It would be a game-changer if such a bill were passed, in terms of monetizing a whole new class of North Dakota resources."
Policy like this, Bohrer said, would create a new market of buying and selling carbon dioxide for enhanced oil recovery. Doing work in the Legislature during this session is important, Bohrer said, because financial incentives would make an oil field partner more willing to undertake something like Project Tundra with all of its risks and challenges.
"We have had a lot of support within the state and a lot of policy support," Dahl said. "Overall, I think, the project is well positioned."
Environmental and economic impacts
Proponents of the project said it is important for reducing carbon emissions and keeping energy at an affordable price for consumers.
Dahl said Project Tundra will preserve the lignite industry, keeping a reliable and cost-effective source of energy available for MinnKota customers.
"With this project, MinnKota will continue to supply low-cost, dependable, clean energy to consumers," said Mike Holmes, vice president of research and development for the Lignite Energy Council. "Low-income residents need affordable energy to heat their house and businesses need reliable electricity, too."
Since only about 5 percent of the coal in the country is lignite, Bohrer said, North Dakota is "on its own" when it comes to continuing production.
"We're not going to make money on this project. We want to find a long-term path for this lignite plant," Dahl said.
Using carbon dioxide for enhanced oil production also is a major benefit to the state, Holmes said. A similar project in Texas, called the Petra Nova Project, was completed in 2016. Since then, oil production there has increased from 500 to 7,000 barrels per day.
With increased oil production, Bohrer said North Dakota residents will benefit from increased oil revenues.
Dahl said there is a lot of pressure on the oil, gas and lignite industries to reduce emissions, and she sees Project Tundra as a way to both preserve the lignite industry and reduce carbon emissions.
"Reducing emissions won't happen without projects like this," Bohrer said. "The United States has to lead the way and provide a model for other countries as they seek to reduce their carbon emissions."