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Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

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Carbon Dioxide: A $550-Billion Opportunity

Anyone would be forgiven for being shocked when they see the words ‘carbon’ and ‘opportunity’ in one sentence. Carbon, after all, or rather carbon-oxygen compounds, are the ultimate enemy of the planet. It is something to be eliminated, not utilized.

Nothing could be further from the truth.

In addition to being an essential element for photosynthesis and as such an essential element for all organic life on the planet, carbon has many other uses. It is these uses that are opening up an opportunity that could develop into a $550-billion market by 2040, according to Lux Research.

There are six areas in which carbon dioxide is used, and each is a potential growth area for the chemical. Building materials, chemicals, carbon additives such as nanotubes and graphene, fuels, polymers, and proteins are each such an area.

The biggest growth would come from the building materials sector, according to Lux. This industry would account for as much as 86 percent of the total carbon utilization market, not least because it would be easy to boost CO2 utilization in the making of building materials such as cement or cure concrete by direct CO2 injection. The only challenge, really, is regulatory constraints of the wider use of CO2 in the industry, which the researchers expect to ease after 2030.

The production of fuels, additives, and chemicals is naturally another growth area. With technology available to turn carbon dioxide back into a liquid hydrocarbon fuel, this is one promising direction of utilizing the greenhouse gas. There is a lot of promise in graphene as well, though it has yet to materialize. Carbon dioxide will help with that, given that graphene is a layer of carbon atoms.

In this area, however, according to Lux, regulatory support is needed and technological innovation. The former shouldn’t be a problem as carbon dioxide-derived fuels will effectively reduce the world’s demand for more crude oil to make fuels. The latter, the innovation, should easily gain the support of investors of various sorts as the end goal of carbon utilization is removing carbon from the atmosphere—a goal in line with the environmental agenda.

Related Video: Goldman Calls $70 Oil in Q2, But Jet Fuel Is The Joker

But to utilize the carbon dioxide, one first needs to capture it. There are three points along CO2’s life where this can be done: before combustion—typically at or near the wellhead—after combustion—think coal-fired power plants with CC systems—and directly from the atmosphere.

The direct air capture idea is a very appealing one—if we could just suck out the CO2 that is trapping heat from the Sun in our atmosphere, we would solve all our climate problems. Indeed this has already been proposed: just build a lot of direct air capture machines and start sucking. Only it is extremely expensive, and our climate change fight bill is already well in the trillions.

Post-combustion carbon capture is also rather expensive and needs to become cheaper to reach the stage of mass adoption. There are separate projects, however, such as Ur One Inc.’s technology for capturing carbon dioxide from flue gas, which the company claims it can do at a cost of some $5 per ton and turning it into solid carbon that fetches three-digit prices per 100 grams. The tech is still in the lab, but it could be one of the carbon capture technologies of the future.

Elon Musk recently announced a $100-million prize up for grabs by anyone who proposes a solution to the world’s carbon dioxide problem. Capture is certainly part of the solution, but storage may not be the best—as in, most sustainable—next step. Instead, the utilization of the gas could—and should—become the priority.

It won’t be that hard, either. Lux projects that global carbon demand is on the rise and will stay there thanks to the growing demand for urea—one of the most widely used artificial fertilizers and animal feed additives—and to enhanced oil recovery. But the building materials industry is ripe for more CO2 utilization: CO2 can be turned into solid form and used as cement aggregate (aggregates are various forms of particulate matter that make up the bulk of concrete). It can also be injected in wet concrete to speed up curing.

The other big growth market for CO2 utilization is synthetic fuels. Sadly, this growth market will take a while to unfold. Porsche recently said it was investing $24 million in what are commonly called e-fuels, to replace the hydrocarbons used normally in internal combustion engines. E-fuels combine hydrogen and CO2, but in order to be as low-emission as possible, the hydrogen needs to be made through electrolysis using solar or wind power. This is a prohibitively expensive technology still, making synthetic fuels too expensive as well.

Yet, according to Lux researchers, with the right amount of regulatory support and massive backing from the aviation industry—a huge consumer of fuel—things can change. Right now, to be fair, the aviation industry is in no state to back—financially, that is—anything but this could change too as people start flying again. For all its bad rap, carbon dioxide has a natural place in the low-emission economy of the future. The carbon market is a real and growing one. Given the right conditions, it could even swing into a deficit at some point.

By Irina Slav for Oilprice.com

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  • Eduardo Weinschelbaum on February 25 2021 said:
    On Irina Slav's Carbon Dioxide: A $550-Billion Opportunity article:

    Excellent article. Only comment: Yes, what to do with the captured CO2 is critical. Missing, however, is that, as critical as what to do is how to finance.

    Whatever technology wins Elon Musk's challenge will have to be project-financeable, meaning that a development using such technology can be proven to safely and securely generate enough cash to its developers that a lender will consider lending the money to build it without the need of parent guarantees.

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