Canada Extends EOR Tax Credits, Broadens CO2-Based Oil Recovery Support

Carbon Herald just published Canada Extends Tax Credits For Enhanced Oil Recovery (EOR) Projects.

Carbon Herald reports that the Canadian federal government has announced plans to extend tax credits available to enhanced oil recovery (EOR) projects. EOR uses injected CO2 to push additional crude from mature reservoirs, and proponents argue it can pair with carbon capture to sequester some of that CO2 underground. The extension signals continued federal backing for CCUS-linked oil production at a time when Canada is also pursuing broader emissions reduction targets. Full details on eligibility, duration, and how the credit interacts with existing CCUS investment tax credits are covered in the source article.

Our take (Heads-up): EOR sits in a contested space: it can store CO2, but it also yields more oil that gets burned downstream. The net climate benefit depends heavily on lifecycle accounting boundaries and on whether the CO2 used is captured from industrial sources or sourced fresh. Worth tracking how Ottawa defines additionality here.

-> Read the full piece at Carbon Herald

Captain Drawdown is flagging this. The reporting is Carbon Herald’s. Go read them directly, not a rewrite from us.

Source: Carbon Herald