Conestoga Energy, a prominent force in the low carbon intensity biofuel sector, has announced a significant stride in its environmental and commercial strategy with the successful completion of drilling operations for its inaugural Class VI well. This well, a critical component of carbon capture, utilization, and sequestration (CCUS) efforts, is located near the Company's Bonanza BioEnergy ethanol plant in Garden City, Kansas. This achievement marks a pivotal step in Conestoga's commitment to decarbonizing U.S. ethanol production and unlocking enhanced commercial value through enhanced oil recovery (EOR).

The newly drilled Class VI well is designed to serve as the cornerstone of Conestoga’s ambitious initiative to permanently store carbon dioxide emissions generated during its ethanol production processes. This development is expected to significantly reduce the carbon intensity (CI) score of Conestoga’s bioethanol, thereby increasing its market margins and reinforcing the company’s position as a leader in sustainable fuel.

Conestoga is preparing to submit its comprehensive Class VI permit application to the U.S. Environmental Protection Agency (EPA) this summer. This rigorous application process will include extensive geological, seismic, and environmental data, demonstrating the site's suitability for secure, long-term carbon storage. The company anticipates that once operational, the facility will sequester over 150,000 metric tons of CO2 annually, effectively capturing and storing 100% of the CO2 emissions generated from its bioethanol production. Furthermore, the project holds the potential to accommodate CO2 from third-party sources, opening avenues for Conestoga to earn additional carbon credits and diversify its revenue streams.

A unique aspect of Conestoga’s integrated CCUS strategy is its proximity to an enhanced oil recovery (EOR) site. Situated just fourteen miles from Conestoga’s Class II well, this setup allows for 100% of the captured CO2 to be utilized for EOR. This established technique involves injecting CO2 into mature oil fields, a process that not only restores depleted reservoir pressure and enhances production efficiency but also simultaneously sequesters carbon underground. This dual benefit offers both attractive economic returns and substantial emissions reductions, aligning perfectly with Conestoga's financial and carbon management objectives.

This successful drilling operation solidifies Conestoga's standing as an early innovator and leader in developing CCUS projects. The company boasts a proven track record of capturing CO2 for over a decade, having been the first in the industry to sequester CO2 for EOR. This historical expertise provides a strong foundation for their ambitious new Class VI well project.