Work

Field-Scale Techno-Economic Assessment and Real Options Valuation of Carbon Capture Utilization and Storage—Enhanced Oil Recovery Project Under Market Uncertainty

Year: 2026

Type: article

Abstract: This study develops a field-based techno-economic model and decision framework for a CO2-enhanced oil recovery and storage project under joint market uncertainty. Historical drilling and completion expenditures calibrate investment cost functions, and three years of production data are fitted with segmented hyperbolic Arps curves to forecast 20-year oil output. Markov-chain models jointly generate internally consistent pathways for crude oil, ETA, and purchased CO2 prices, which are embedded in a Monte Carlo valuation. The framework outputs probability distributions of NPV and deferral option value; under the mid scenario, their mean values are USD 18.1M and USD 2.0M, respectively. PRCC-based global sensitivity analysis identifies the dominant value drivers as oil price, CO2 price, utilization factor, oil density, pipeline length, and injection volume. Techno-economic boundary maps in the joint oil and CO2 price space then delineate feasible regions and break-even thresholds for key design parameters. Results indicate that CCUS-EOR viability cannot be inferred from oil price or any single cost factor alone, but requires coordinated consideration of subsurface constraints, engineering configuration, and multi-market dynamics, including the value of waiting in unfavorable regimes, contributing to low-carbon development and sustainable energy transition objectives.

Source: Sustainability

DOI: 10.3390/su18020805

Authors: Chang Liu, Cai-Shuai Li, Xiao-Qiang Zheng

Institution: Southwest Petroleum University

Language: English

Topic: Capital Investment and Risk Analysis

Subfield: Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Climate action, Affordable and clean energy

Open Access status: gold

Estimated APC paid: $2,896