Research On Comprehensive Benefit Evaluation And Policy Needs Of China Carbon Dioxide Enhanced Oil Recovery

With the rapid development of the economy and the increasing consumption of fossil energy,China’s CO₂ emissions continue to increase.China as a major consumer of crude oil,China’s crude oil output has been declining,which making China depend on crude oil imports increasing.Carbon dioxide enhanced oil recovery（CO₂-EOR）can capture,transport and store CO₂ emitted by high energy consumption enterprises.While reducing CO₂ emissions,it can increase crude oil recovery,which is of great significance to China’s economic development.However,the higher economic cost limits the implementation of CO₂-EOR under the existing market conditions.Therefore,relevant policies are needed to support the development of CO₂-EOR.In this study,we use partial life cycle assessment（LCA）and real option models to analyze the policy support of China’s CO₂-EOR project.Firstly,the LCA is used to evaluate the energy consumption and air emissions of CO₂-EOR.Secondly,the results of the energy and environment assessment are brought into the economic assessment,and a CO₂-EOR model based on deferred investment real options is constructed.Finally,through empirical analysis,from the perspective of carbon prices,crude oil prices,and government subsidies,the optimal policy conditions under China’s current CO₂-EOR development level are simulated and analyzed,which provides support for China’s CO₂-EOR policy improvement.The research results show that the oil production stage is the largest contributor for all of the energy consumption indicators of CO₂-EOR gate to gate.The main energy consumption of CO₂-EOR gate to gate is electricity.And the proportion of CO₂,SO₂ and NO_x emissions resulting from electricity consumption is more than 97%of total emissions in CO₂-EOR gate to gate.Compared with the amount of CO₂injection,the net CO₂ emissions of CO₂-EOR gate to gate to produce one metric ton of crude oil are-1675.15 kilograms.The analysis of the real option model based on the above evaluation shows that under the current market conditions,China’s CO₂-EOR project is less likely to gain income.Therefore,when the CO₂-EOR policy is under optimal conditions,and the carbon prices,crude oil prices,and government subsidies reach a certain level at the same time,China’s CO₂-EOR projects can obtain higher returns.Based on the above research results,this study proposes the following seven policy recommendations to provide reference for the improvement of China’s CO₂-EOR policy.First,refine the subsidy policy from the perspective of cost influencing factors;second,strengthen the management of CO₂ emitting enterprises and promote the improvement of carbon tax policies;third,adjust the tax collection mechanism and implement tax reduction and exemption policies;fourth,expand financing channels and increase the sources of funds;fifth,reduce the cost of operation and maintenance from the perspective of talent introduction and talent training;sixth,strengthen spatial cooperation and reduce energy consumption;seventh,expand the scope of supervision and supervision,and strengthen the implementation of supervision.