Economic evaluation on CO2-EOR of onshore oil fields in China

Carbon dioxide enhanced oil recovery (CO2-EOR) and sequestration in depleted oil reservoirs is a plausible option for utilizing anthropogenic CO2 to increase oil production while storing CO2 underground. Evaluation of the storage resources and cost of potential CO2-EOR projects is an essential step before the commencement of large-scale deployment of such activities. In this paper, a hybrid techno-economic evaluation method, including a performance model and cost model for onshore CO2-EOR projects, has been developed based on previous studies. Total 296 onshore oil fields, accounting for about 70% of total mature onshore oil fields in China, were evaluated by the techno-economic method. The key findings of this study are summarized as follows: (1) deterministic analysis shows there are approximately 1.1 billion tons (7.7 billion barrels) of incremental crude oil and 2.2 billion tons CO2 storage resource for onshore CO2-EOR at net positive revenue within the Chinese oil fields reviewed under the given operating strategy and economic assumptions. (2) Sensitivity study highlights that the cumulative oil production and cumulative CO2 storage resource are very sensitive to crude oil price, CO2 cost, project lifetime, discount rate and tax policy. High oil price, short project lifetime, low discount rate, low CO2 cost, and low tax policy can greatly increase the net income of the oil enterprise, incremental oil recovery and CO2 storage resource. (3) From this techno-economic evaluation, the major barriers to large-scale deployment of CO2-EOR include complex geological conditions, low API of crude oil, high tax policy, and lack of incentives for the CO2-EOR project. (C) 2015 The Authors. Published by Elsevier Ltd.