Mathematical Model to Determine Optimal Transportation Infrastructure for Geologic Carbon Storage in the Illinois Basin

Analysis of results from a mathematical programming model were examined to 1) determine the least cost options for infrastructure development of geologic storage of CO₂ in the Illinois Basin, and 2) perform an analysis of a number of carbon tax and oil price scenarios in order to implement development of the least cost pipeline networks for distribution of CO₂. The quantitative analysis also tested the hypothesis of whether pipeline connected enhanced oil recovery (EOR) sites can serve as nodal points (spoke and hub) for expansion of the CO₂delivery infrastructure to (a) more distal oil fields or (b) deeper saline aquifers as well as if higher prices of oil and a carbon dioxide emissions tax would increase the economic viability of carbon sequestration. Various policy target scenarios were tested with the mathematical programming model.  The qualitative analysis examined how differing prices of oil and carbon dioxide emissions taxes are likely to affect the evolution of the carbon sequestration industry under particular policy scenarios.

The model, using mixed integer programming, tested the hypothesis of whether viable EOR sequestration sites can serve as nodal points or hubs to expand the CO₂ delivery infrastructure to more distal locations from the emissions sources. This is in contrast to previous model results based on a point to point model having direct pipeline segments from each CO₂ capturesite to each sink. There is literature on the spoke and hub problem that relates to airline scheduling as well as maritime shipping. A large scale ship assignment problem that utilized integer linear programming was run on Excel Solver and described by Mourao et al., (2001). Other literature indicates that aircraft assignment in spoke and hub routes can also be achieved using integer linear programming (Daskin and Panayotopoulos, 1989; Hane et al., 1995). The model tested whether certain geographic locations would make suitable nodal points for distribution of CO₂ to more distal sink locations. The distribution concept is basically the reverse of the “tree and branch” type (Rothfarb et al., 1970) gathering systems for oil and natural gas that industry has been developing for decades.

Preliminary model results indicate that the inclusion of hubs as a variable in the model yields lower cost transportation costs for geologic carbon storage over previous models of point to point infrastructure geometries. Cost reductions of even as little as 5 to 10 percent can result in significant savings when infrastructure costs run into the hundreds of millions of dollars. The results are encouraging for examination of other hub scenarios to determine an optimal set of hub locations.

Other results indicate that geologic storage of CO₂into saline aquifers does not come into solutions selected by the model until the carbon tax approaches $50/ton. Carbon capture and storage begins to occur when the oil price is above $24.41 a barrel based on the constraints of the model. The annual storage capacity of the basin is nearly maximized when the price of oil is as little as $30 per barrel and the carbon tax is $55. This low price scenario results in generation of approximately $16.26/ ton stored CO₂ in revenue. A more realistic scenario of $100 dollar oil and a $55 carbon tax yields approximately $54.19/ ton stored CO_2.