1. Sandia National Laboratories is a multi-program laboratory managed and operated by Sandia Corporation, a wholly owned subsidiary of Lockheed Martin Corporation, for the U.S. Department of Energy's National Nuclear Security Administration under contract DE-AC04-94AL85000. Working Results. SAND2011-7325C. Peter H. Kobos, Jesse D. Roach, Jason E. Heath, Thomas A. Dewers, Sean A. McKenna, Geoff T. Klise, Jim Krumhansl, David J. Borns, Karen A. Gutierrez Sandia National Laboratories and Andrea McNemar National Energy Technology Laboratory Economic Uncertainty in Subsurface CO 2 Storage: Geological Injection Limits and Consequences for Carbon Management Costs 30th USAEE/IAEE North American Conference, October 9-12, 2011, Washington, DC Acknowledgements: This work is developing under the funding and support of the National Energy Technology Laboratory. 1

2. Water, Energy and CO 2 Sequestration (WECS) Model: Geologic Saline Formation (4)H 2 O Treatment & Use(1) CO 2 Capture (2)Formation Assessment & CO 2 Storage (3) H 2 O Extraction 2

3. Project Timeline & Goals Single Source (power plant)Multiple Sources Single Sink (saline formation)WECS Multiple Sinks WECSsim Completed Phase I: Developed a Test Case Model (WECS) Completed Phase II: Additional TOUGH2 Analysis Completed Phase III: Developed a single power plant to any saline formation sink in the U.S. systems calculator Phase IV & V: Expanding the role of uncertainty within the model Several order of magnitude variation in key geologic parameter (permeability) Incorporating uncertainties into costs Timeline 2008 2009 2010 2011 2012 3

4. WECSsim Modular Structure NatCarb Database polygon analysis, well data analysis, and heterogeneous formation characterization inform the CO 2 Sequestration Module NETL reports, publically available reports, and well analysis inform the Extracted Water and Power Cost Modules Various NETL reports inform the Power Plant and Carbon Capture Modules Extracted H 2 O capacity Extracted H 2 O quality Power Plant Module CO 2 Capture Module Geologic CO 2 Sequestration Module Extracted Water Module Power Cost (Integrating Module) Plant type CO 2 generated Mass CO 2 to be sequestered Treated cooling H2O Energy required for H 2 O extraction and treatment Base LCOE CO 2 capture & compression costs CO 2 transport & sequestration costs Water extraction transport and treatment costs Parasitic energy Water demand change 4

5. Geological CO 2 Storage Database Challenges 5 Coal Power Plant Gas Power Plant Well Well selected on depth and salinity criteria 325 down selected regions original NatCarb Atlas data

6. Distribution of Geologic Porosity 6

7. Injectivity equation: permeability sampled from 4 Rock Types 7

8. Uncertainty and the Well Injectivity Index I well injectivity index; measure of the “ease” of injecting CO 2 into the well q volumetric injection rate ΔPthe pressure gradient Reservoir volume Radial flow from the well (Bryant and Lake, 2005) 8

9. WECSsim Results: Permeability and Costs 9

10. WECSsim Results: Injection Costs and Formation Types 10

11. WECSsim Results: Injection Costs Relative to Total Costs 11

12. WECSsim Results: Similar Full Economic Analysis Underway $ Avoided CO 2 Emissions Note: Illustrative Example at this time 12

13. Conclusions Low CO 2 injection rates results in higher costs Low injectivity requires more injection wells and therefore higher costs Accurate Site Permeability Characterization is key Importance of High Quality Saline Reservoirs High permeability reservoirs with low injection costs (< $1/tonne) represent < ~10% of the 325 formations Scale-up challenge Using a national-level systems approach The mix of reservoirs of different quality is a major factor that will control ‘supply’ of CO 2 storage 13

14. Ongoing and Future Work CO 2 injectivity-brine extractivity and heterogeneity i.e., “How do injection rates improve with brine extraction?” Spatial distribution of CO 2 sources to sinks i.e., “Are the high quality sinks accessible to large sources?” National Level Supply Assessment i.e., “How much low-cost CO 2 storage exists in the U.S.?” 14

15. For Further Information: Initial Framework Description Kobos, P.H., Cappelle, M.A., Krumhansl, J.L., Dewers, T.A., McNemar, A., Borns, D.J., 2011. Combing power plant water needs and carbon dioxide storage using saline formations: Implications for carbon dioxide and water management policies. International Journal of Greenhouse Gas Control, 5, 899-910. Sandia National Laboratories is a multi-program laboratory managed and operated by Sandia Corporation, a wholly owned subsidiary of Lockheed Martin Corporation, for the U.S. Department of Energy's National Nuclear Security Administration under contract DE-AC04-94AL85000. Working Results. 15

16. Backup Slides: Assessing U.S. deep saline formations WECSsim interpretation of U.S. deep saline formation resource 1. NatCarb 2008 geospatial database estimates (publically available) Data and Analysis Product NatCarb data & analysis 2. NatCarb partnerships (direct communication) SNL and publically available data & analysis NatCarb well data 3. Parameter estimation from well data Other publically available data and SNL studies Expert opinion 4. Geologic classification of polygons to reduce computational costs 16

17. Limited Saline Formation Data 17

18. Gulf coast outliers Why do the Gulf Coast formations lie above the carbonate formations? 18

19. Gulf coast outliers 19

20. Gulf coast outliers 20

21. Gulf coast outliers id#2 id#165 21