The deal gives impetus to Norway’s plan to become a global CCS leader
WHAT: The group want to build an offshore CCS system on the NCS.
WHY: Norway wants to develop world-class CCS expertise to promote around the world.
WHAT NEXT: Statoil will select a site for its CO2 receiving station before the end of the year.
Royal Dutch Shell and Total have signed an agreement with Norway’s Statoil to “mature the development” of carbon capture and storage (CCS) techniques and technologies.
The group wants to advance development of the technology with a view to building an offshore CCS system on the Norwegian Continental Shelf (NCS).
Total and Shell will provide “people, experience and financial support” for the project, according to a statement released by all three companies.
Statoil was awarded the contract for the first phase of the project from the state-run CCS developer Gassnova in June, and laid out plans for a multi-stage system capable of storing 1.5 million tpy of carbon dioxide (CO2).
CO2 captured from large power plants or industrial facilities will be delivered by boat or piped to the west coast of Norway to a receiving station, which will then prepare it for storage before pumping it down a series of undersea pipes to an injection site in the largely depleted Troll gas field. It will then be injected back into the field and stored underground to avoid atmospheric release. Norway already stores CO2 in a number of fields, including Gudrun, Sleipner and Snohvit.
Norway has been looking to become a global leader in CCS technology for some time, seeing the process as both a viable way to meet its carbon reduction targets and as a commercial opportunity to help other countries do the same.
Statoil and Gassnova intend to develop expansive CCS capacity for domestic carbon storage, whilst simultaneously creating technology and expertise that can then be exported worldwide. Major potential clients include oil-producing and heavy industrial nations such as China, India and the US.
It is anticipated that the coming together of the three oil giants in this project will spur on CCS research and development (R&D). As a means of carbon reduction, CCS has fallen behind other technologies such as renewables because it does not generate any energy on its own and remains technically unproven. But it could help countries to meet their carbon reduction targets in tandem with the gradual shift to renewables.
“Shell sees CCS as a transformative technology that can significantly reduce emissions from those industrial sectors that will continue to rely on hydrocarbons for decades to come,” Shell’s executive vice president for environment and safety, Monika Hausenblas, said after the agreement was signed. “Shell has significant experience of working with governments and other experts to support the development and wide-scale deployment of CCS and is pleased to be joining forces with our joint venture partners.”
Total’s president of gas, renewables and power, Philippe Saquet, added his company’s “involvement in this first commercial-scale storage project is … fully aligned with our low-carbon roadmap.”
He added: “The aim of this first integrated industrial-scale project, supported by the Norwegian government, is to develop [a] viable, reproducible commercial CCS model in view of carrying out other major projects around the world.”
Total and Shell’s involvement in the project suggests that major oil and gas firms are seeing the value in CCS development and the potential value in its global roll out. The continued development of the technology will be an expensive undertaking, requiring massive amounts of infrastructure and development in order to overcome the existing hurdles.
Statoil will select a site for its receiving station before the end of the year. It will then work on providing solutions to problems such as ensuring loss-free capture, transporting CO2 in sufficient quantities and plugging all possible leaks from the field to secure the storage fields in the long term.
The investment and support of major companies will provide the Norwegian government with the funding to push through the development hurdles.
Now that the partnership is in place, the three companies will resume the R&D process and prepare key infrastructure.
The government’s strategy calls for a full-scale CCS chain to be established in the country by 2022, significantly earlier (and at a much lower cost) than previously estimated. Once this chain is functional, the country will begin taking carbon from clients across the North Sea and Europe, whilst also looking to sell its expertise further afield.