Denbury Inc. announced a CO₂ transport and storage agreement with Mitsubishi Corp. on Sept. 21, marking the first CCUS deal for the Plano, Texas-based independent energy company.

“We are excited to deliver the first of what we believe will be many CO₂ transport and storage deals with industrial customers along our extensive infrastructure footprint,” Chris Kendall, president and CEO of Denbury, commented in the company release.

In the release, Denbury said it executed a term sheet with Mitsubishi through its subsidiary, Denbury Carbon Solutions LLC, for the transport and storage of CO₂ captured from Mitsubishi’s proposed ammonia project on the U.S. Gulf Coast. 

Denbury launched its Carbon Solutions business in January 2020, building on decades of experience utilizing CO₂ in its EOR operations.

For over two decades, Denbury has maintained a unique strategic focus on utilizing CO₂ in its EOR operations and since 2013 has been active in carbon capture, use and storage (CCUS) through the injection of captured industrial-sourced CO₂ in the Gulf Coast and Rocky Mountain regions where its operations are focused.

Per the term sheet, Denbury will transport and sequester all of the CO₂ captured at the Mitsubishi ammonia facilities, which are planned for construction in close proximity to Denbury’s CO₂ Green Pipeline system. Additionally, the deal includes the option for Denbury to utilize the captured CO₂ in its EOR operations or for storage in other geologic sequestration sites.

Mitsubishi aims to introduce its fuel ammonia to the Japanese market, with production commencing from its Gulf Coast facility in the latter half of the decade, according to the release. The project is targeted to produce an ammonia volume of around 1 million metric tons per annum (mmtpa) with associated CO₂ emissions of around 1.8 mmtpa and the potential for additional ammonia projects to follow.

The agreement between Denbury and Mitsubishi has an initial period of 20 years, with the ability to extend further. Total volumes under the arrangement could surpass 50 million metric tons of CO₂, the release said.

“Today’s announcement with Mitsubishi highlights Denbury’s position as the preferred business partner for transporting and storing captured industrial CO₂ emissions,” Kendall said in the release adding that he looks forward to working with Mitsubishi on this project, which represents a “significant step in the creation of substantial value through our Carbon Solutions business.”

Denbury currently injects over three million tons of captured industrial-sourced CO₂ annually, according to the release. The company’s objective is to fully offset its Scope 1, 2 and 3 CO₂ emissions within this decade, primarily through increasing the amount of captured industrial-sourced CO₂ used in its operations.