Denbury to Purchase CO₂ from Two Sources in Wyoming and Mississippi

Denbury Resources, an oil and natural gas company, announced that its subsidiary has signed two carbon dioxide (CO₂) purchase agreements with DKRW Advanced Fuels and Mississippi Power.

Under the terms of the agreements, the company will receive CO₂ from anthropogenic sources in the Rocky Mountain and Gulf Coast regions.

Denbury will purchase CO₂ from Medicine Bow Fuel and Power (MBFP) project of DKRW Advanced Fuels. MBFP is an industrial liquefaction and gasification facility, which will capture CO₂ from coal-to-transport fuels program in Medicine Bow, Wyoming. The Medicine Bow facility will clean, condense, and supply the CO₂ to Denbury. The estimated CO₂ supply will be about 200 MMcf/d. Denbury will use the gas for enhanced oil recovery in the Rocky Mountain area as well as for sequestration in CO₂ enhanced oil recovery reservoirs. The initial CO₂ delivery from MBFP is expected to begin at the end of 2014 or at the start of 2015.

Mississippi Power has started the construction of an Integrated Gasification Combined Cycle (IGCC) power facility with 582 MW capacity in Kemper County, Mississippi. The facility will capture, clean, and distribute the CO₂ to Denbury’s oil field in the Gulf Coast region. The estimated CO₂ supply is 115 MMcf/d and the first delivery is anticipated to begin in 2014.

Phil Rykhoek, CEO of Denbury, stated that the CO₂ supply from DKRW and Mississippi Power facilities will enable the company to produce large amount of oil from its exhausted oil fields.