Geologic CO<sub>2</sub> Sequestration and Subsurface Property Rights: A Legal and Economic Analysis
Creators: name: R. Lee Gresham
Publisher: name: Figshare
Year: 2018
Subjects: subject: 160510 Public Policy
subject: FOS: Political science
subject: 99999 Engineering not elsewhere classified
subject: FOS: Other engineering and technologies

description: Carbon dioxide emissions (CO<sub>2</sub>) from the combustion of fossil fuels must be reduced on a large scale to mitigate the effects of global climate change. Carbon capture and sequestration
(CCS) has the potential to allow the continued use of fossil fuels with little or no emissions
until alternative, low-to-zero emission sources of energy are more widely deployed. This
thesis considers the legal and economic implications of securing the right to use geologic
pore space—the microscopic space in subsurface rock matrixes—in an effort to sequester
CO<sub>2</sub> deep underground to mitigate climate change. The findings and conclusions drawn in this thesis are intended to help guide discussion, research, and decision-making processes undertaken by policymakers and industry leaders with respect to the commercial-scale deployment of CCS. Prior to the commencement of sequestration, a project
developer/operator must have authorization to access and use pore space to avoid liability for
subsurface trespass. This authorization can be acquired via bilateral contract, where monetary
compensation is remitted to the property owner in exchange for the right to use pore space.
However, the question remains open as to whether the use of pore space for geologic CO<sub>2</sub> sequestration (GCS) is a trespass requiring compensation under the law. In fact, there is ample legal precedent in the context of underground injection activities such as enhanced
hydrocarbon recovery, fluid waste disposal, and freshwater storage to support the supposition
that the invasion of pore space by injected is compensable only when substantial harm or
interference with an existing or non-speculative, investment-backed future use of the
subsurface results from the injection of such fluids. This thesis shows that if CCS is widely
deployed, the cost of electricity and power plant profitability could be adversely affected by a
legal requirement that pore space owners must be compensated for GCS in all circumstances.
Moreover, absent unrealistically high electricity prices or some form of sequestration
subsidy, pore space has no net-positive, intrinsic economic value to electric generators that
can be passed along to property owners. Therefore, while paying property owners to use of
pore space for geologic CO<sub>2</sub> sequestration may very well foster public acceptance and
appease staunch private property rights advocates, there is no demonstrable legal or
economic rationale for compensating property owners who have no current or nonspeculative,
investment-backed future use of the subsurface where pore space targeted for
sequestration is located. A pragmatic and equitable solution for constraining the potential
negative economic effects associated with acquiring pore space rights would be for state or
federal legislatures, or courts, to limit required compensation to only those instances where
the injection and migration of CO<sub>2</sub> materially impairs current or non-speculative, investment-backed future uses of the subsurface. Future work should include a detailed analysis of
takings law and the anticipated long-term constitutional and economic implications of
various approaches to pore space property rights governance before new CCS-specific laws
are enacted. The models presented in this thesis should also be applied to additional site-specific
geologic data for saline aquifer sequestration targets. Additionally, the implications
of GCS paired with enhanced oil recovery (EOR) on power plant economics should be
studied.