The Need For Robust MMV Plans In CCUS Operations

Written by Brad Gilmour, Peter Ciechanowski and Maruska Giacchetto at Bennett Jones

A robust measurement, monitoring and verification (MMV) plan is a fundamental component to any proposed carbon capture, utilization and sequestration (CCUS) operation. The purpose of an MMV plan is to monitor, reduce and manage the potential risks of loss of containment associated with permanent sequestration from a specific geological site.

MMV plans are an important part of many new opportunities in Alberta's oil & gas sector as CCUS plays an essential role in Canada’s proposed aggressive transition to a net-zero economy by 2050. The announcement of a CCUS tax credit in the April 2022 federal budget potentially adds to this momentum for certain CCUS projects types.

Critical components of an MMV plan

MMV plans must be filed with and approved by the Minister of Energy. The Alberta Energy Regulator (AER) will also consider the MMV plan when reviewing applications and considering approvals for the development of a CCUS project. There are a number of critical components that proponents need to address in an MMV plan.

This includes the collection and analysis of data to optimize sequestration operations, as well as ensuring reliability in measuring the volumes of carbon dioxide injected, monitoring the migration and sequestration of the carbon dioxide plume, and managing the integrity of the geological formation. Under Alberta’s Carbon Sequestration Tenure Regulation (CSTR), plans must also sufficiently assess the likelihood of the proposed CCUS project interfering with the recovery of other minerals.

The CSTR authorizes two types of dispositions for sequestration activities, both of which require approval of an MMV plan.

The first is an evaluation permit, which allows a proponent to drill wells for evaluating the suitability of geological formations for carbon sequestration.

The second is a sequestration lease, which allows a proponent to drill wells to conduct evaluation and testing for the purpose of carbon injection and sequestration.

The CSTR imposes additional requirements to an MMV plan for a sequestration lease from that of an evaluation permit:

  • the plan must be submitted in greater detail for approval;
  • an annual report must be provided to the Government of Alberta regarding findings and observations from the leaseholder's MMV activities; and
  • the MMV plan must be renewed and approved every three years.

The CSTR does not, however, provide specific details regarding the information to submit for approving an MMV plan.

Lessons learned for submitting successful MMV plans

Alberta is home to a successful commercial-scale CCUS project to address carbon emissions — the Shell Canada Energy Quest Project at the Scotford Upgrader near Edmonton. It began operations in 2015 and is designed to capture 1 million tonnes of CO2 emissions per year.

The decision issued by the Alberta Energy Resources Conservation Board (predecessor to the AER) concerning the approval of Quest provides valuable insight as to what information should be presented in an MMV plan and its assessment by the AER (see ERCB Decision 2012 ABERCB 008). This includes:

  • clearly demonstrating how projects will prevent serious impacts to the environment;
  • addressing every phase of the project from its commencement to post-closure phases;
  • early detection and proposed measures to implement for mitigating any potential impacts of a containment breach; and
  • having a plan that is adaptive, flexible and responsive to all operational phases of the project.

The AER has several directives setting out the requirements for CO2 transport and injection. The AER recently released a revised draft version to Directive 065 (Draft Directive 065), which proposes further details that will be considered when the AER assesses CCUS project applications and subsequent development approvals. Draft Directive 065 provides information on requirements for different aspects of a CCUS project application, including containment of the maximum expected fluid plume, safety of the CCUS project operations, and reporting. The AER is accepting feedback to Draft Directive 065 until July 10, 2022.

The Government of Alberta released a Request for Full Project Proposals for CCUS Hubs (CCUS Hub RFPP) on March 3, 2022. The CCUS Hub RFPP provides further insight as to the required information for a strong MMV plan submitted to the Minister of Energy. This includes:

  • anticipated capacity targets for conducting evaluations;
  • initial assessment of several factors, including monitoring plume containment;
  • project plan, timeline, modeling and site characterization activities; and
  • assessment of the MMV techniques and technology.

On March 16, 2022, the Government of Alberta released the first version of a document establishing the key principles and objectives of an MMV plan (MMV Guidelines). The MMV Guidelines provides information on what the MMV plan is expected to address for the following stages of a CCUS project lifecycle:

  • All Project Stages;
  • Pre-injection (for an evaluation permit);
  • Pre-injection (for a sequestration lease);
  • During Operation/Injection; and
  • During Closure Period.

Looking ahead in Alberta

With an abundance of suitable geological formations for carbon sequestration and world-leading expertise in CCUS activities, Alberta stands to be the reference jurisdiction for carbon sequestration operations including with respect to MMV plans.

The Government of Alberta is currently in the process of selecting project proposals from companies to build, own, and operate a CCUS hub within the province. Recently announced federal CCUS tax credits will potentially further incentivize development of CCUS projects and expansion of these technologies. Any successful CCUS hub or project will require a robust MMV plan that is risk-based and adaptive, that accurately tracks CO2 sequestration and long-term storage performance, and ensures formation containment. For a more comprehensive review of these considerations, please read our blog Achieving Net Zero by 2050: The MMV Plan as a Fundamental Component to Carbon Sequestration Operations.

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