Talos Energy Inc. announced that, along with its partner Carbonvert, Inc., was the sole winning bidder partnership for the Texas General Land Office's Jefferson County, Texas carbon storage site located near Beaumont and Port Arthur, Texas.
Following finalization of lease documentation, the award will place Talos among a very select group of domestic independent energy companies with a physical project site dedicated to carbon sequestration and storage. Together, Talos and Carbonvert bring the collective experience of a top-tier Gulf of Mexico oil and gas operator with carbon capture, renewables, and financial expertise.
The Company's bid was selected as the only successful proposal among twelve submissions and the Texas School Land Board unanimously approved awarding the lease to Talos and Carbonvert, subject to finalization of lease terms. The Project Site encompasses a total land area of over 40,000 gross acres and is located offshore in Texas state waters in the Gulf of Mexico. The Project Site is 100% covered by the Company's existing seismic database and is located in close proximity to a large concentration of industrial emitters along the Texas and Louisiana Gulf Coast. Based on Talos's preliminary understanding of the rock and fluid properties of the saline reservoirs of the Project Site, the Company expects it can ultimately sequester approximately 225 to 275 million metric tons of carbon dioxide from industrial sources in the area. Talos will be the operator of this project.
Talos President and Chief Executive Officer Timothy S. Duncan commented: "This is an exciting announcement for Talos and Carbonvert as we advance our carbon capture initiative from concept towards our first tangible project site. With this award, we are positioned to become among the first independent U.S. energy companies with an identified site dedicated to carbon sequestration, further advancing our leadership among peers in this rapidly-developing space. The Project Site possesses favorable geological characteristics and close commercial proximity to support an attractive project in the future. This is the first of several steps in our strategy to build multiple carbon capture and storage sites along the United States Gulf Coast where we can use Talos's core competencies to operate these important projects."
Duncan continued: "We want to redefine the role of traditional oil and gas companies, as we recognize the need to responsibly develop and produce hydrocarbons as well as lowering overall emissions in the communities where we work and live. We also recognize the importance of this project to the State of Texas and, more specifically, the Texas School Land Board, which voted unanimously to approve this award to Talos. Our employees are proud to be part of such an important project that benefits the environment through de-carbonization, teachers and students, local communities and Talos shareholders through an attractive commercial opportunity."
The process will now enter into an exclusive phase where Talos and Carbonvert will negotiate a lease agreement with the GLO staff based on the terms of the Talos bid and the terms included in the original request for proposal from the GLO. Final terms are subject to the approval of the Texas School Land Board.
The Company's proposal was submitted in partnership with Carbonvert, a carbon capture and storage-focused project management company founded in late 2020 by renewable and conventional energy industry veterans. This bid submission pre-dates the Company's exclusive joint venture with Storegga Geotechnologies Limited ("Storegga") to pursue carbon capture and sequestration throughout the U.S. Gulf Coast. Talos continues to work with both landowners and emitters across the Gulf Coast to move forward additional carbon capture and sequestration sites.
