While most of the energy world watches billion-dollar hydrogen hubs and carbon capture mega-projects struggle through permitting and financing, a very different kind of CCS story just took a major step forward in South Texas — and almost nobody noticed.
This week, BKV Carbon Project Operating, LLC received a key air permit for its Lima Tango CCS 1 project in McMullen County, Texas, clearing the way for full commercial operation of carbon capture and sequestration infrastructure tied to one of the state’s most prolific gas corridors.
This is not a press-release project.
This is a real facility, now legally authorized to run.
What Was Just Approved
On January 7, 2026, the Texas Commission on Environmental Quality (TCEQ) issued a New Registration Permit-by-Rule (PBR) for:
- Project: Lima Tango CCS 1
- Operator: BKV dCarbon Project Operating, LLC
- County: McMullen County (Freer area, South Texas)
- Rule: 30 TAC §106.352 – Oil & Gas Production Facilities
This rule authorizes the air emissions from compressors, dehydration units, tanks, valves, and venting systems used to handle high-pressure gas streams — including CO₂-rich gas.
In practical terms, this permit allows the surface carbon capture and compression facility to legally operate.
Without it, CO₂ injection cannot begin.
Why This Permit Matters More Than It Looks
Texas doesn’t issue §106.352 permits for research projects, pilots, or theoretical CCS concepts.
This rule is used for full-scale oil & gas processing and compression facilities.
That tells us three important things about Lima Tango:
First, this is commercial, not experimental.
You only register under §106.352 when you are installing permanent compressors, dehydration, and gas-handling equipment.
Second, CO₂ is being actively captured and processed.
Injection wells alone don’t need air permits. You only need this approval if you are compressing, dehydrating, venting, or moving CO₂ — meaning the capture side of the CCS system is now built.
Third, the CCS system is tied to producing gas assets.
This rule applies to oil and gas production facilities, confirming Lima Tango is capturing CO₂ from real-world natural gas processing, not from a lab or test unit.
Why McMullen County Is the Perfect CCS Location
Lima Tango sits near Freer, Texas, in the heart of the Eagle Ford gas and condensate fairway — an area known for:
- CO₂-rich natural gas streams
- Acid gas removal units
- Existing gathering and processing plants
- Deep, well-understood geologic formations
This is exactly where CCS works economically.
Instead of transporting CO₂ long distances from power plants, BKV is capturing CO₂ directly from its own gas processing stream, compressing it onsite, and injecting it underground nearby. That’s the lowest-cost, highest-reliability CCS model in North America.
Where the Injection Well Fits In
The air permit confirms the surface facility is ready.
The final step is the Texas Railroad Commission (RRC) Class II injection well permit for CO₂ sequestration.
Those permits are issued separately under the Underground Injection Control (UIC) program and typically appear shortly after the air side is approved. In Texas CCS projects, air authorization almost always comes just before injection wells go live.
This means Lima Tango is now in the final stretch before CO₂ starts flowing underground.
Why This Is Bigger Than One Project
Lima Tango is not just a CCS site — it’s a template.
BKV owns and operates natural gas assets across Texas and the Midcontinent. By pairing gas production with CCS, the company is building a portfolio of low-carbon, tax-advantaged gas assets that qualify for:
- 45Q carbon tax credits
- Low-carbon LNG premiums
- ESG-driven gas sales
- Long-term carbon storage contracts
Instead of waiting for government-funded mega-hubs, BKV is quietly rolling out modular CCS hubs at the wellhead and processing-plant level.
That model scales faster.
It’s cheaper.
And now, it’s permitted.
A Signal for Energy, Infrastructure, and Carbon Markets
The Lima Tango permit tells us something important about where the U.S. carbon market is really heading.
The next wave of CCS growth will not come from power plants.
It will come from gas processors, field compression, and upstream operators capturing CO₂ that is already being separated today.
South Texas just became one of the most important CCS growth zones in the country — and BKV just took the lead.
