Value of Information Analysis in CO2 Sequestration Projects

As one of the main risks related to CO2 storage is leakage, it is important to consider the impact of the reservoir uncertainties on the long-term CO2 migration and leakage which affecting the decisions in CO2 storage project. Value of information (VOI) is an effective means to assess the maximum a decision maker should pay for gathering and assessing data and information in a given decision context, in order to achieve a high-quality decision. This study introduces, illustrates, and discusses the role of VOI analysis in deciding whether to accept a contract for a CO2 storage project. A decision problem is framed where a company that provides CO2 storage as commercial services plans to sign a contract to store CO2 at the Utsira Formation on the Norwegian Continental Shelf. The evaluated reservoir uncertainties include permeability, porosity, caprock elevation, aquifer conditions (pressure and temperature). A key contribution of this study is to introduce and discuss a workflow that is useful for a preliminary evaluation of information gathering schemes in CO2 storage projects carried out before injection commences, with the purpose of achieving cost-effectiveness and high-quality decisions. Moreover, it demonstrates the VOI application with multiple objective values: to maximize the Net Present Value (NPV) and to minimize the long-term leakage. The proposed workflow involves the determination of the material variables, the use of swing weighting, CO2 injection simulation, and a simulation-regression approach to approximate the posterior value that is used to calculate the VOI. Finally, the study also investigates how sensitive the decision model and the objective values are to variations in certain parameters. For the decision situation framed in this study, the VOI analysis can be used to inform the company’s decision of whether to gather and assess more data and information before signing a CO2 storage contract