Jordan Blum, editorial director, Hart Energy: I'm Jordan Blum, editorial director with Hart Energy, and I'm joined by Jerry Ashcroft, the CEO of Crescent Midstream for this Hart Energy LIVE exclusive. Crescent is doing a lot with carbon neutrality and carbon capture, but first I wanted to talk to you just if you can explain all the rapid growth Crescent's had in recent years with the backing from Carlyle Group and the acquisition of the CHOPS offshore pipeline system.

Jerry Ashcroft, CEO, Crescent Midstream: Jordan, thank you first of all for having me and having Hart Energy sponsor this. It's exciting times at Crescent Midstream, really all about that growth that you just spoke of. We've really tripled our size in the last 24 months, and a lot of that's come through both organic growth with us just growing our system as the Gulf of Mexico is growing, and part two of it has been through acquisition, as you mentioned.

JB: Very good. Can you elaborate just on that most recent acquisition with CHOPS and how that's played out?

JA: Yeah, so one of the things that we looked at doing was really concentrating on what we saw coming with the growth of the Gulf of Mexico production. The first thing we did was we decided to sell our California assets and then gain a system called Grand Isle Gathering System. That was kind of our foothold from the acquisition side.

We then had the opportunity to become a 30%, 6% non-op owner of the Genesis pipeline called CHOPS, and once again, we saw the wave of production growth in the Gulf of Mexico and really wanted to join in that on the pipeline transportation side.

JB: Leaning into the energy transition too, what I think is interesting is you all have the goal by the end of this year, very soon, becoming the first midstream oil and gas company to go carbon-neutral.

JA: Yeah, thanks for bringing that up. One of the things that we've seen is that we've got this great momentum with our crude oil platform with gathering and transmission, and with this team that we have that's done so well, we wanted to go into energy transition next. The first step was to bring carbon neutrality to our own company, so we spent a lot of time on driving down our emissions. Everything from vapor recovery units to using VFDs on our pumps and motors. Once we got it down to a much smaller size, we've then gone out to the Well Done Foundation to buy carbon credits to offset that last piece.

JB: Then you all are working too in a consortium with Repsol and Cox Oil on carbon capture and sequestration in the Gulf of Mexico as well.

JA: We support a group called Carbon Zero, and so Carbon Zero has that same consortium you mentioned, and we've been lucky enough to be granted a plan from the DOE for CarbonSafe. That CarbonSafe program allows us to do further research in not only the geology offshore, but the pipeline connecting the emitters to the sequestration site.

JB: Very good. In the coming years, that'll mean new pipeline construction, maybe some reversal of existing systems?

JA: What's been great about Crescent, we've kind of got two things going for us. One, we have the capabilities of our team and running and operating pipeline safely and reliably in the Louisiana area. The second part is we have a strategic location of our pipelines that is connecting emitters to the sink offshore.

That's our plan: to be that midstream piece that will build pipe, but use the industrial logic of already using our right of way and our core capabilities of our employees to safely transport CO2 offshore.

JB: What are the next steps at this point?

JA: Yeah. The next steps right now is to continue to work with the Department of Energy on what the permitting looks like offshore, continue our communications with emitters to create the best plan to move CO2 from their plants that are many of them around the Geismar-Donaldsonville area to the offshore locations for sequestration.

JB: Obviously the IRA and some other legislation have played a big role in this as well?

JA: When IRA came out in moving the 45Q to $85, that took a lot of projects that were not economic at the time and really put them in play. That's allowed us to really roll up our sleeves now and sit down and look at taking things that were in an appraised stage for projects more into a defined stage and understanding what needs to be done to sequester the CO2.

JB: Great. I think a lot of people don't really know about the potential possibility of doing that carbon capture offshore. Can you talk a little bit about just the benefits of offshore versus onshore?

JA: Yeah, sure. Well, I think one of the great benefits about onshore is there's already a permitting process. It's called the Class VI Process, and that's to protect drinking water, and EPA is working with many teams on creating these sequestration sites throughout the U.S. That's kind of the here and now.

The benefit of offshore though is that just from a geography standpoint, there's a lot of area without endangering any drinking water or the residents in the area, and so I think that's where you'll see the growth go in the Gulf Coast will be to the offshore.

JB: Pun intended, wave of the future?

JA: Yes, pun intended.

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