A system and a process for combusting hydrocarbons to recover energy and the carbon dioxide resulting from the combustion is provided. The process utilizes a two-stage combustion process, each stage utilizing water injection and a recirculation stream to increase the efficiency of combustion to generate larger proportions of carbon dioxide. An energy recovery boiler is used to recover heat energy from the combustion product. Combustion product is then cleaned and the carbon dioxide is separated and condensed into a useable liquid carbon dioxide product.