Published July 16, 2024
By Christine Reed
The School of Energy Resources (SER) hosted an informative workshop in June to investigate valuation methodologies for pore space in carbon capture, utilization and storage (CCUS) projects as part of a study entitled, “Understanding Pore Space Values: A Technical, Legal and Economic Analysis of Valuation Methodologies and Contractual Structures.”
Funded by the Department of Energy (DOE) and led by SER Professor of Law and UW’s Occidental Chair in Energy and Environmental Policies Tara Righetti, the project aims to develop guidance for determining contract structures, relative compensation, and valuation methodologies for pore space on federal and private on-shore lands in the U.S.
The workshop brought together an impressive array of leaders in carbon sequestration from industry, academia and government where the research team presented their findings to date.
“The market for pore space is rapidly evolving and changing, making this an opportune moment for research,” says Righetti. “Incorporating multiple perspectives is pivotal to understanding this emerging market. We were grateful for the opportunity to solicit feedback and workshop our forthcoming report.”
The June workshop is the second organized under the project. In November of 2023, the team convened federal land managers to discuss the regulatory frameworks for pore space utilization and valuation on only federal lands.
“The first workshop was very much focused on information gathering and listening related to the section of the report on federal agency authority and processes for granting sequestration rights in pore space,” says Righetti. “Agencies are developing the rules and guidance for pore space contemporaneously with this research. By taking an iterative approach to this project, we were able to integrate the agencies perspectives, hopefully resulting in a more relevant final product.”
This second workshop expanded the parties for feedback to include industry representatives and other leading researchers in the field, and solicited feedback on our preliminary findings for both private and federal lands, she adds.
“The question of pore space access and compensation is one of the biggest emerging challenges and areas of stakeholder friction in CCS,” says Ashleigh Ross, vice president and head of commercial development and policy at Carbon America. “That also means that if we can get this right, it could be the biggest opportunity to unlock CCS investment! It is absolutely critical we bring these perspectives together to dig deep and think creatively about what we’re trying to accomplish, and we’re so grateful for the work of the University of Wyoming and DOE for this collaboration.”
With Righetti serving as Principal Investigator, the report was compiled by a collaborative team of SER researcher scientists and professionals including Madeleine Lewis, Autumn Eakin, Maryam Lakjaa, Selena Gerace and Dayana Jones to work on legal, economic, social and technical issues. The team also worked with Bryan Leonard, Assistant Professor in the School of Sustainability at Arizona State University, and Timothy Fitzgerald, Associate Professor of Business Economics at Texas Tech University who contributed to the economic modeling aspects of the study.
Part III of the report, “Federal Pore Space Utilization,” authored by Righetti and Lewis, will be forthcoming as a Boston University Law Review article in early 2025.
The project will conclude with a final report to DOE in September and will aim to inform future inquiries.
