Wyoming Passes Bill to Bolster Carbon Management Opportunities

With interest and activity in carbon capture, sequestration and storage and low carbon energy production ramping up, especially in Wyoming, the energy industry is celebrating the signing of HB0032. The bill, titled “Geologic Sequestration-unitization amendments,” was a product of the Joint Minerals Committee that was worked on throughout the Interim in 2023 with a coalition of stakeholders including landowners, industry, the Wyoming Oil and Gas Conservation Commission (WOGCC) and the Wyoming Department of Environmental Quality (WDEQ).

The key elements of the bill, or clarifications the bill brings, include the following:

• It specifies that pore space utilization is a purpose of geologic sequestration unitization.
• economic benefits are clearly defined:“the equitable proportionate share of all financial proceeds due to the pore space owners in a unit area based upon each individual pore space owner's contribution of pore space storage capacity to a unit area.”
• Those who are unitized shall be entitled to a proportionate share of all economic benefits received by unit members.
• Federal injection fees, lease payments and other considerations shall not be considered in determining the proportionate share of economic benefits for those who are unitized.
• The bill helps clarify landowner rights and bring landowner protections, including to help ensure fair market rates for payment and by clarifying specific rules between WDEQ and WOGCC.
• The bill clearly defines unit area: "the pore space lying within the geologic formation proposed to be operated and may include the area of geologic sequestration for one or more injection wells.”
• A unitization application shall include all persons/owners of the surface estate or pore space estate within the unit and those who are within half of a mile of the unit boundary.

This language will help the carbon capture storage developers and landowners to build out projects in Wyoming for permanent carbon sequestration. These projects will include hundreds of construction jobs and permanent jobs along with millions paid in landowners for pore space leasing. These projects will infuse millions in tax revenues to the counties and the State of Wyoming. Other industries are also looking at co-locating near these storage fields to have access to industrial grade CO₂ for medical, food and beverage purposes along with cement manufacturers looking to add CO₂ to use in the manufacturing of cement. Once injected into the concrete mix, the CO₂ reacts with calcium ions from cement to form a nano-sized mineral, calcium carbonate, which becomes embedded in the concrete. This makes the concrete stronger, enabling mix optimization while eliminating the CO₂.

Wyoming is well positioned in sub-terranean capacity, infrastructure and political will to engage in the wave of interest in carbon management, and alongside Louisiana and North Dakota, is one of three states to have been granted primacy by the EPA for Class VI permits.

This document is intended to provide you with general information regarding HB0032 in Wyoming. The contents of this document are not intended to provide specific legal advice. If you have any questions about the contents of this document or if you need legal advice as to an issue, please contact the attorneys listed or your regular Brownstein Hyatt Farber Schreck, LLP attorney. This communication may be considered advertising in some jurisdictions. The information in this article is accurate as of the publication date. Because the law in this area is changing rapidly, and insights are not automatically updated, continued accuracy cannot be guaranteed.