LSB Industries and Lapis Energy File Application for Class VI Injection Permit With EPA for Carbon Capture and Sequestration (CCS) Project at LSB’s El Dorado, AR, Facility
21 February 2023 - 11:00PM
Business Wire
LSB Industries, Inc. (“LSB” or “the Company”), (NYSE: LXU) and
Lapis Energy LP (“Lapis”) today jointly announced the filing of a
permit application with the U.S. Environmental Protection Agency
(“EPA”) to construct a Class VI well as part of their project to
capture and permanently sequester carbon dioxide (“CO2”) at LSB’s
El Dorado, Arkansas facility (“El Dorado”). Class VI wells are used
to inject CO2 into deep rock formations. This long-term underground
storage, called geologic sequestration, reduces atmospheric CO2
emissions and helps to mitigate climate change.
Upon approval of the Class VI permit, Lapis will begin
construction on the infrastructure required to capture and
sequester CO2 at El Dorado. The project is targeting the Hosston
and the Cotton Valley geologic formations to permanently store the
CO2. Once in operation (target 2025), the sequestered CO2 is
expected to reduce LSB’s direct greenhouse gas (“GHG”) emissions by
approximately 25% from current levels. In addition, sequestering
more than 450,000 metric tons of CO2 annually should allow LSB to
produce over 375,000 metric tons of low carbon, or “blue” ammonia
annually, a product expected to be more valuable than conventional
ammonia. The permanently sequestered CO2 generated from the
facility’s ammonia production is expected to qualify for federal
tax credits under Internal Revenue Code Section 45Q, which are
currently up to $85 per metric ton of CO2 captured beginning in
2026.
Reg Manhas, Lapis Energy’s CEO, stated, “We are very pleased to
have submitted the Class VI permit application to the EPA. We
conducted extensive up-front research, computational modeling, and
tests in order to confirm the efficacy to permanently sequester CO2
at LSB’s El Dorado facility and believe that the quantity and
quality of the data will facilitate the EPA process. This project
benefits from the presence of geological formations that provide
high-capacity storage with excellent injection potential directly
beneath the facility. These conditions allow for a very short
pipeline within LSB’s property to transport the CO2 from the
ammonia plant. We look forward to working with the EPA towards
approval of this important Class VI well application.”
Mark Behrman, President, and Chief Executive Officer of LSB
Industries, added, “The filing of the Class VI permit is a major
milestone in the low carbon ammonia project we are developing with
Lapis. We are very excited to progress the transition to what we
believe will become a large future market and are proud to be
developing the first CCS project announced in the state of
Arkansas. This project is very compelling for us from both
environmental and commercial perspectives as it will meaningfully
reduce LSB’s greenhouse gas emissions from ammonia production while
enabling us to offer our customers solutions to help them
decarbonize their supply chains, particularly those in industrial
sectors or those looking to use ammonia as a fuel. We look forward
to receiving the EPA’s comments to and approval of our Class VI
permit application so that we can move forward with our efforts to
reduce greenhouse gas emissions.”
About LSB Industries, Inc.
LSB Industries, Inc., headquartered in Oklahoma City, Oklahoma,
manufactures and sells chemical products for the agricultural,
mining, and industrial markets. The Company owns and operates
facilities in Cherokee, Alabama, El Dorado, Arkansas and Pryor,
Oklahoma, and operates a facility for a global chemical company in
Baytown, Texas. LSB’s products are sold through distributors and
directly to end customers primarily throughout the United States.
Committed to improving the world by setting goals that will reduce
our environmental impact on the planet and improve the quality of
life for all of its people, the Company is well positioned to play
a key role in the reduction of global carbon emissions through its
planned carbon capture and sequestration, and zero carbon ammonia
strategies. Additional information about LSB can be found on its
website at www.lsbindustries.com.
About Lapis Energy LP
Backed by Cresta Fund Management, Lapis is the Partner of Choice
for energy-intensive industries seeking to achieve their carbon
goals through the delivery of carbon capture and sequestration
(CCS) projects. Located in Dallas and founded in 2020 by a team of
industry-leading experts, Lapis is actively building a world-class
portfolio of CCS projects within North America. For more
information about Lapis, please visit www.lapisenergy.com.
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Investor Contacts: Fred Buonocore, CFA, Vice President of
Investor Relations (405) 510-3550 fbuonocore@lsbindustries.com
Media Contact: David Kimmel, Director of Communications
(405) 815-4645 dkimmel@lsbindustries.com
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