LSB Industries announces carbon capture partnership

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LSB Industries, Inc. announced it is joining forces with Lapis Energy of Dallas for a large carbon capture project at LSB’s facility in El Dorado, Arkansas.

The Oklahoma City-based company described it as a project to capture and permanently sequester up to 450,000 tons a year of CO2 with the help of Lapis.

Lapis will be backed by Cresta Fund Management, a Dallas-based middle-market infrastructure investment firm and will make 100% of the capital investment for the project. The cost of the project was not revealed in the LSB announcement. Lapis, founded in 2020 by a team of leading industry experts, is a Dallas-based vertically integrated energy infrastructure development firm focused entirely on decarbonization through carbon capture projects.

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Construction will begin immediately and completion is expected by 2025, subject to approval of a permit at which time CO2 injections will begin. LSB said it will be the first carbon capture and sequestration project in Arkansas and the third such project from ammonia production in the U.S.

“We are very excited to partner with Lapis and take our first step to becoming a supplier of low carbon or ‘Blue Ammonia’ — allowing us to participate in what we believe will become a large future market,” stated Mark Behrman, President, and Chief Executive Officer of LSB Industries.

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He said carbon sequestration is a proven means of reducing greenhouse gas emissions from ammonia production and the El Dorado operation is located above deep geological formations with the capacity to sequester decades of CO2 production from the plant.

“Our customers, particularly our industrial customers, need solutions to help them decarbonize their supply chains and low carbon feedstocks represent an attractive opportunity to accomplish this goal in the near-term, while technologies for more sustainable no carbon or ‘Green Ammonia’ production continue to become economical,” added Behrman.

Once operational, the project at the El Dorado site will initially capture and permanently sequester more than 450,000 metric tons of CO2 per year in underground saline aquifers, with the potential to increase this quantity based on potential debottlenecking projects at the facility.

El Dorado, AR Facility | LSB

This will be equivalent to permanently removing approximately 109,000 passenger cars from the road, which represents approximately 11% of the cars registered in Arkansas. The permanently sequestered COgenerated from the facility’s ammonia production is expected to qualify for federal tax credits under Internal Revenue Code Section 45Q, which are currently $50 per metric ton of COcaptured beginning in 2026, but under evaluation by Congress to increase the 45Q tax credit to $85 per metric ton of CO2.

Once in operation, the sequestered CO2 will reduce LSB’s scope 1 GHG emissions by 25% from current levels. In addition, sequestering more than 450,000 metric tons of CO2 annually will enable LSB to produce over 375,000 metric tons of blue ammonia annually, a product expected to be more valuable than conventional ammonia.

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.

Source: Business Wire