HOUSTON — Chevron U.S.A. Inc., Talos Energy Inc. and Carbonvert Inc. have announced a memorandum of understanding (MOU) for an expanded joint venture (JV) to develop the Bayou Bend CCS offshore carbon capture and sequestration hub held by Talos and Carbonvert.
In 2021 a JV between Talos and Carbonvert (now known as Bayou Bend CCS) was the winning bidder for the Texas General Land Office’s Jefferson County, Texas, carbon storage lease, located in state waters offshore Beaumont and Port Arthur, Texas.
The Bayou Bend CCS project site encompasses more than 40,000 gross acres and, based on Talos and Carbonvert’s preliminary estimates, could potentially sequester 225 million to 275 million metric tons of CO2 from industrial sources in the area. The Bayou Bend CCS lease is the first and only offshore lease in the U.S. dedicated to CO2 sequestration.
Under the terms of the MOU, Talos and Carbonvert would contribute the Bayou Bend CCS lease to an expanded JV including Chevron in exchange for consideration of cash at closing and capital cost carry through project final investment decision. Upon closing of the JV, equity interests in the JV would be 25% Talos, 25% Carbonvert and 50% Chevron, with Talos remaining the operator.
The creation of the proposed JV is subject to the negotiation of definitive agreements with customary closing conditions, including regulatory approval.