Isramart: First US State to Codify Law for Carbon Sequestration is Wyoming

Isramart news:
Wyoming could be the first state to develop a comprehensive set of legal rules dealing with carbon sequestration risk. Before we begin carbon sequestration projects, say lawmakers in the state, we need to get some fundamental legal rights and responsibilities clear.

Which land owner can prevent a carbon sequestration project from taking place under their land – the mineral rights owner, or the surface land owner? Which owner is legally responsible for the storage? How about in 100 years? Which governmental entity should oversee best practices and enforce potential liability in carbon sequestration – and how can that department be funded to do the job adequately?

Now that several CCS pilot projects are under way, and with future limits on greenhouse gases inevitable – using either the unpopular carrots and sticks of cap and trade in APA, or the even more unpopular sticks-only regulation by EPA – other states with significant coal industries like Montana and South Dakota are following Wyoming’s efforts closely as they consider how to draw up their own rules.

The Wyoming Department of Environmental Quality, which is currently in charge of overseeing most aspects of carbon sequestration projects, will bring draft rules on carbon sequestration before the state Environmental Quality Council in July.

Already this year, state legislators passed a precursor bill that requires that landowners be notified of carbon sequestration proposals and mandates that carbon sequestration project operators have liability insurance and provide financial assurances to get a sequestration permit. At the very least, they will have to pay a permit fee to the state, which is to go towards monitoring carbon sequestration projects.

The proposed rules spell out the process and standards for obtaining a carbon sequestration permit, including detailed application requirements, proving a pore space can sequester carbon dioxide, and an extensive monitoring plan. The draft rules draw from EPA regulations, groundwater protection research and discussions, and existing regulations for hazardous waste wells.

Under the state’s framework, the underground carbon storage space is owned by whoever owns the surface rights above it.

The exception? In any dispute over a particular pore space, the owner of the mineral rights on that land will have priority over the owner of the surface rights.