Carbon capture utilisation and storage will play a significant role in supporting the traditionally emissions-heavy oil and gas sector advance towards net zero.
However, despite great enthusiasm for the technology, project costs, investor skepticism and a lack of stakeholder engagement are slowing the progress needed to drive these projects forward and ensure 2050 climate targets are met.
These risks and opportunities were highlighted in a recent discussion moderated by PEi Editor-in-Chief Kelvin Ross that brought together carbon capture experts from energy giant BP, Norwegian institute SINTEF Industry, Scottish Carbon Capture and Storage and consultancy Frost & Sullivan.
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Martin Towns, senior advisor for CCUS at BP, stated that carbon capture will play a huge part in the transition to net zero. He conceded that it is perceived to be expensive – and indeed it is – however he stressed: “Even though, it is also the cheapest route to next zero. It can reduce the costs of transitioning to net zero if deployed at scale.”
Towns said CCUS is a proven technology that requires cooperation, financial and otherwise, from public and private sectors and NGOs to realise its full potential.
Mahesh Radhakrishnan, Industry Analyst & Consultant, Frost & Sullivan agreed that with the proper support from government in terms of funding, greater awareness of the technology the increase in economies of scale and decreased capital costs positive sentiment towards CCUS will grow.
Radhakrishnan said: “Financiers are skeptical of these projects because the technology is still underdeveloped, there is insufficient commercialisation which has taken place, moreover, there has to be more support from government in terms of funding. Most of the liquidity lies with the private sector, but the private sector finds it difficult to maximise the return on investment due to uncertainties around storage and utilisation. These projects are currently quite expensive, the price range is different for different projects and there is no fixed cost to be identified, making it challenging for investors to define the rate of return”.
Towns suggests the skills needed to deliver these projects and developed the economies of scale can already be found in the oil & gas sector, skills such as understanding the subsurface and geology, managing of complex supply chains and engineering skills.
With the skills in place, Towns believes the best way to achieve economies of scale is by combining infrastructure, such as in a clean energy park like Net Zero Teeside. The Teeside project sees carbon transported from the Tees and Humber and stored deep under the Southern North Sea.
The CO2 captured will be sent via pipeline to a saline aquifer called Endurance, where it will be stored. As the hubs grow and include capture from more facilities, we will expand to include other offshore storage sites, using Endurance as a distribution hub. The project will also see hydrogen produced and CO2 captured from hydrogen production.
The Teeside project has a well-suited location for CCUS, and Towns stressed that location was vital for any project. He explained that location is influenced by access to geological storage, good quality carbon sources and the presence of policy to create business model, with policy having the greatest influence over development.
Dr Inna Kim, Senior Research Scientist, SINTEF Industry provided more detail on Project REALISE, which aims to decarbonise the oil refinery sector.
The sector produces about 1 billion tonnes of CO2 annually and CCS is seen as a viable option to decarbonise oil refineries quickly. It’s a challenging sector to abate, said Dr Kim, due to the compact, varying and explosive nature of a refinery.
She explained that Project REALISE uses post combustion or end of pipe solutions to capture CO2 at refineries, the most cost efficient route.
The project captures carbon from a multi-stack refinery using solvent based technology. Solvent and solvent management technologies are tested in the lab allowing the technology to be adapted and data to be produced for thermodynamic models.
The technology will be demonstrated over two pilots that will test solvent stability in the presence of impurity, found in flue gas. CO2 will be received in combined stripping areas, avoiding the transportation of large volumes of gas inside the refineries. Rather, liquid will be pumped through smaller pipes for regeneration.
Ultimately, Dr Kim explained, the demonstration aims to improve the quality of CO2 collected for shipping, while analysing business cases and reducing cost.
She added that one of the main ways to ensure successful CCS deployment is to engage with local communities and stakeholders, engage in public outreach, account for the social and politcal environment and provide life long learning.
This sentiment was echoed by Dr Romain Viguier, Business Development & Project Manager at Scottish Carbon Capture and Storage (SCCS) who defined the approach, tools and best practices for developing CCS clusters.
He also shared analysis of what makes a successful cluster, with one of the most important characteristics being non-technical, such as sound leadership and engagement and support from local stakeholders.
Dr Viguier also provided insights into Project STRATEGY, a three-year scheme aimed at developing CCUS in eight regions across Europe.
The project is based on existing research and is supported by the existence of an industry cluster, transport infrastructure and an opportunity for CO2 use and hydrogen production.
Dr Viguier said the project “aims to develop local CCUS plants with local business models in the region, and develop local connection plants and transport corridors between local CCS clusters”.
Ultimately, he said the ambition was to develop a Europe-wide CCUS infrastructure which would share best practice and expertise.
Even though the panelists focused on European projects, Mahesh Radhakrishnan of Frost & Sullivan made it clear that this technology is a global force to be reckoned with.
Radhakrishnan said: “The appetite has been growing for a long time in North America… the US has one of the oldest carbon capture facilities, established in 1972. There are 38 commercial facilities at various stages of development in North America, amounting to 50% of global operating capacity capturing about 83 million tonnes per annum. There is a lot of traction in this region and by 2030, 11 more projects will be added into operation in North America alone.
“Europe is in the process of developing CCUS potential in various parts. Around 13 commercial operations are in various stages of development, with Noway being the frontrunner… In Europe, the total capture is 21 million tonnes per annum… By 2030, the major growth regions will be Europe and North America, but having said that, there is a lot of potential in Asia Pacific, with a lot of projects in the pilot phase there”.