Port of Corpus Christi Enters into Agreement for Carbon Capture and Sequestration Opportunities

Member Updates,

Photo courtesy of Port of Corpus Christi.

Talos Energy Inc. has announced that the company and Howard Energy Partners (“HEP”) have entered into an option agreement with the Port of Corpus Christi Authority (the “Port”) to pursue commercial carbon capture and sequestration (“CCS”) opportunities on-site at the Port of Corpus Christi. The project will be known as the Coastal Bend Carbon Management Partnership. During the initial nine-month evaluation period, the parties will identify and mature CCS project solutions on Port-owned lands. With a diverse industrial footprint at the Port, transportation infrastructure and expertise from HEP, and subsurface and sequestration capabilities from Talos, the parties are positioned to offer a local, fully integrated CCS project to customers in the region.

The Port of Corpus Christi is a major strategic export hub and one of the largest ports in the United States, accounting for over $200 billion of economic impact from approximately 7,000 vessel shipments annually. Port-related employment accounts for approximately 100,000 jobs in the Coastal Bend area. The Coastal Bend Carbon Management Partnership aims to provide the Port’s more than 200 customers with a turn-key CCS solution to participate in meaningful decarbonization efforts.

The lease option agreement encompasses approximately 13,000 acres for CCS project evaluation, with an initial goal to sequester 1.0 – 1.5 million metric tons of CO2 per year of industrial emissions into saline aquifers utilizing an estimated total storage capacity of 50 – 100 million metric tons. Based on proof of concept and market demand, the parties may expand the project to Regional Hub scale, with the capability to sequester 6 – 10 million metric tons per year of the approximately 20 million metric tons per year of total regional emissions. HEP’s Javelina midstream system is directly connected to over half of the total regional emissions with approximately 60 miles of existing infrastructure, which is ideally situated for gathering activities throughout the Port area.

Talos President and Chief Executive Officer Timothy S. Duncan commented: “We are honored to be working on this project with the Port of Corpus Christi Authority and Howard Energy Partners. We have already commenced our technical and commercial evaluation and are confident in the potential success and positive impact this project can have on the Coastal Bend region. The Port of Corpus Christi is an incredibly important export hub for the United States, and our goal is to offer their large customer base an on-site decarbonization solution to help reduce the carbon intensity of those products shipped all around the world from right here in Texas. Our collaboration with HEP adds midstream expertise and simplifies commercial terms while enhancing our operational capabilities, making this offering a logical choice for the many blue-chip companies operating in the Port of Corpus Christi today.”

Howard Energy Partners Chairman and Chief Executive Officer Mike Howard commented: “We are proud to partner with Talos and the Port of Corpus Christi to provide CO2 capture, transportation and sequestration solutions for customers in the Coastal Bend area. As a South Texas based company with significant infrastructure in Corpus Christi, we are uniquely positioned to leverage our midstream expertise and our strategically located Javelina off-gas recycling facility to provide cost-effective CO2 capture to our existing customers while reducing the local industry’s carbon footprint. This partnership is a natural evolution of the HEP growth story and a testament to our continued commitment to providing energy solutions that the world requires to flourish.”

Port of Corpus Christi Authority Chief Executive Officer Sean Strawbridge commented: The Port of Corpus Christi is committed to proactive environmental protections. Our current environmental policy is robust, but there’s always more work to be done, particularly considering the urgency needed to limit the impact emissions have on the climate. Engaging best-in-class companies such as Talos Energy and Howard Energy Partners in this innovative endeavor to create a centralized CCS solution is a natural milestone in our evolution of adding additional clean energy sources to our portfolio. As the third-largest industrial waterway in the nation, we take our role as stewards of this gateway extremely seriously and our actions will be deliberate and demonstrable of this commitment.”