Piñon Midstream Receives EPA Approval for CO2 Storage at Dark Horse Facility

Piñon Midstream secured monitoring, reporting, and verification (MRV) plan approval from the U.S. Environmental Protection Agency (EPA) for the permanent storage of CO₂ in two acid gas injection (AGI) wells at the Dark Horse Treating Facility in Lea County, NM. The wells offer sequestration redundancy for operators in the Delaware Basin using Piñon’s Dark Horse facility to mitigate flaring and access local drilling inventory.

“Piñon was founded to create sustainable and scalable sour gas infrastructure solutions,” said Steven Green, Piñon’s CEO. “Having now received both the MRV plan approval from the EPA and an NSR air permit from the State of New Mexico, and with our most recent capacity expansions up and running, we believe we are in position to become the Delaware Basin’s leading sour gas treating and carbon management provider.”

The AGI wells—Independence AGI 1 and Independence AGI 2—are Devonian wells reaching depths approximately 3.4 miles below the surface into rock formations. These formations are located several thousand feet below water aquifers and existing Delaware Basin oil and natural gas-producing formations. The wells are approved for a combined 20 million cubic feet per day of CO₂ and H₂S injection, equivalent to approximately 250,000 metric tons (MT) of CO₂ and 110,000 MT of H₂S per year.

Piñon’s MRV plan became effective in June 2024 and outlines a description of technical procedures for sequestration, monitoring, and verification at the Dark Horse Treating Facility. The approved MRV plan also fulfills a requirement for 45Q tax credit eligibility and enhanced tax credits in line with the Inflation Reduction Act 2022.

Dark Horse Treating Facility; Image Credits: Pinon Midstream

From August 2021 to 2023, Piñon captured and permanently sequestered approximately 160,000 MT of CO₂ and 65,000 MT of H₂S—the annual emissions equivalent of up to 35,000 vehicles or 21,000 households. Over the next year and at its current operational rate, the facility is expected to capture and sequester more than 190,000 MT of CO₂ and 90,000 MT of H₂S.

On May 8, 2024, Piñon Midstream placed the 450-GPM Amine Train III into operation at its Dark Horse sour natural gas treating and carbon-capture facility. The company also obtained an NSR air permit to allow for the execution of additional capital expansion projects at the Dark Horse facility, such as constructing two cryogenic processing plants and Amine Trains IV, V, and VI. The new amine-treating unit increased Dark Horse’s sour natural gas treating capacity by 50% to approximately 270 MMcf/d and it now totals 1,350 GPM of amine treating.

In addition to the commissioning of Amine Train III, recent facility expansions include new sour gas gathering and gas lift pipelines, a 15,000-horsepower compressor station, and interconnects for downstream processors. In April, Piñon expanded its sour natural gas gathering system adding about five miles of NACE-compliant 16” high-pressure steel pipeline. The 15,000 hp Comanche Peak Compressor Station is the company’s fifth NACE-compliant station along the upgraded pipeline.

The Grande sweet gas pipeline system consists of approximately 22 miles of 20” high-pressure steel pipe and connects the Dark Horse Treating Facility to multiple downstream processors, offering customers processing variability for treated natural gas. Piñon also signed a sixth interconnect agreement with a downstream processor, increasing downstream takeaway and processing capacity to more than 500 MMcf/d.