First California project to bury climate-warming gases wins key approval

In a major step toward California’s first effort to bury climate-warming gases underground, Kern County’s Board of Supervisors today unanimously approved a project on a sprawling oil and gas field.

The project by California Resources Corp., the state’s largest producer of oil and gas, will capture millions of tons of carbon dioxide and inject it into the ground in the western San Joaquin Valley south of Buttonwillow.

The Carbon Terra Vault project is part of a broader bid by the oil and gas industry to remain viable in a state that is attempting to decarbonize. Although the company still faces additional steps, the county approval is a key development that advances the project.

The Newsom administration has endorsed carbon capture and sequestration technology as critical to California’s efforts to tackle climate change — it plays a major role in the administration’s action plan for slashing greenhouse gases over the next 20 years.

At a packed four-hour meeting in Bakersfield today, community members and environmental justice advocates voiced concerns about air pollution from the project and the safety of injecting carbon dioxide underground, while oil industry representatives and local supporters said it would give Kern County an economic boost.

“Carbon Terra Vault will incentivize new polluting infrastructure throughout Kern County,” said Ileana Navarro, a community organizer with the Central California Environmental Justice Network, based in Bakersfield. “This will not clean our air.”

Francisco Leon, CEO of California Resources Corp., told county supervisors that the project would preserve high-paying jobs while reducing carbon emissions. He said the company is committed to investing in the community and preparing the region’s workers for careers in the emerging field of “carbon management,” including through a partnership with Kern Community College.

“When we talk about an energy transition, the jobs have to be just as good, they cannot be just one-for-one,” Leon said, speaking at the hearing. “The state of California wants an energy transition. This is how you do it, with projects that deliver on every front. We’re ready to go.”

Before construction can begin, the U.S. Environmental Protection Agency would have to give the project a final signoff. Earlier this year, the agency approved draft permits for the company to build four wells for injecting carbon dioxide into the ground, and the company is seeking two more. In addition, for the company to be eligible for state clean-fuel credits, the California Air Resources Board must certify it as eligible.

Construction would take about two years for the carbon capture plants and a year for the pipelines, according to the environmental impact report.

“The state of California wants an energy transition. This is how you do it, with projects that deliver on every front. We’re ready to go.”

Francisco Leon, CEO of California Resources Corp.

Experts say the Kern County location is significant because the San Joaquin Valley is ideal for carbon storage. The EPA permits are the first in the nation to be issued for a depleted oil and gas field, according to the company.

As oil output has slowed in California, the oil and gas industry and labor unions say the technology could preserve jobs while ensuring that the industry captures and stores more greenhouse gases that it emits.

But environmental advocates opposed the project, saying that polluting fossil fuel industries need to go altogether as California transitions to an economy powered by renewable energy. They say the technology could prolong the life of oil and gas and that the project would emit air pollutants that could pose health risks to low-income communities in the valley.

County Supervisor Phillip Peters criticized the environmental groups. “I don’t see any projects from them that are creating jobs, that are doing anything to benefit the environment,” he said. Peters, who used to work in oilfields, added that “I was really surprised by this argument that this infrastructure for the oil industry is being purposely located in underserved communities…we usually site infrastructure equipment for the oil industry where there’s oil.”

“I’m not an apologist. I’m proud of our oil sector,” said Supervisor Jeff Flores. “It provides jobs, and I think it’s really a morally arrogant position to say that your jobs don’t matter.”

In a 4-0 vote, the county supervisors approved a zoning change and use permits to allow  “permanent underground storage of up to 49.1 million tons of carbon dioxide” in two underground reservoirs on about 9,000 acres at its Elk Hills Oil and Gas Field, along with a pipeline and new facilities to capture it.

The carbon dioxide would be extracted from natural gas produced at the field before it is burned at the company’s power plant, which provides energy for Pacific Gas & Electric. Carbon also would be captured from a proposed hydrogen plant and a direct air capture project that would use fans and filters to remove carbon dioxide from the atmosphere. 

California Resources Corp. plans to annually collect 1.46 million metric tons of carbon dioxide and inject it into the ground more than a mile deep into the Monterey Formation, a vast geological structure that has long been a key source of California’s oil.

Credit: John Osborn D’Agostino / CalMatters

During the years of construction, heavy equipment would emit smog-forming gases and fine particles, and when the plant is operating, some fugitive emissions would come from the carbon capture process, according to the environmental impact report. Those pollutants will be regulated by local air quality officials. The report also cautioned that the project could harm or disturb some protected plants and wildlife, including lizards, birds of prey, kit fox, so measures to avoid them are required.

The EPA will require the company to monitor the injection wells for a century to ensure that no groundwater is polluted. Initial examinations suggest there are no drinking water sources threatened by injecting carbon into the reservoir. But the project would use significant amounts of groundwater in a basin that already is over-pumped.

A coalition of environmental and environmental justice groups including the Sierra Club, the Center for Biological Diversity and EarthJustice, called the plan “inadequate” under California environmental law. The groups said the the environmental report fails to take into account that fossil fuel activities would be extended in the area.

13 other carbon proposals pending in California

Carbon capture technology has existed since the 1970s and has been tried in other states and countries, often at coal-fired power plants, though those projects have been criticized as costly and complicated.

In the U.S., much of the carbon injected underground had been used to extract oil out of wells, a practice California banned in 2022. The Kern County project would instead remove carbon dioxide from natural gas produced at the oilfields.

Since 2022, the Biden administration has spurred a rush to construct these  projects in the U.S. through the expansion of federal tax credits under the Inflation Reduction Act. Applications for 250 carbon capture injection wells are pending nationwide, according to the Clean Air Task Force, a Boston-based energy policy think tank monitoring the initiatives.

The Kern County project is considered a first step toward turning California into a hub for carbon capture — a venture that could receive tens of billions of dollars in government subsidies.

Federal officials also are reviewing 13 other carbon capture proposals in California, mostly in the Central Valley, at oil operations, power plants and other facilities.

The California Resources Corp., through its Carbon TerraVault subsidiary, holds seven of those applications, seeking authorization for 38 wells. The company has released injection data for only some of these proposed wells; those projects could qualify for federal tax credits worth almost $6 billion over a 12-year period. Aera Energy, now a subsidiary of California Resources Corp., also has an application for a carbon storage project. 

California is required under state law to reach net-zero carbon by 2045 — which means that all carbon emissions from human activities are offset with projects that remove them. To meet that mandate, California officials in 2022 approved an ambitious plan that eliminates 94% of fossil fuels but also relies on carbon capture. 

To stay on track, California Air Resources Board officials told CalMatters the state has to rely on carbon capture more than originally envisioned.

“It became clear that we could not get to 85% below 1990 levels (of greenhouse gases) by 2045 without broader application of (carbon capture and sequestration) on large emitting sources,” they said.