Building a global portfolio to enable CCUS
April 2, 2020
We are living in a time of unprecedented global challenges as countries around the world seek to protect the health of their citizens and economies against the impact of Covid-19 and difficult market conditions. Tackling these has become the number one priority, rightly so.
Despite these difficult times, we cannot allow the urgent action needed on climate to lose momentum. That is why OGCI has been continuing crucial work to accelerate deployment of carbon capture, use and storage (CCUS), in support of the Paris climate goals.
Thousands of CCUS projects are needed, especially in heavy industry, if the world is to reduce emissions at the necessary scale – today, globally, there are only 19 in operation. Through a global portfolio of ground-breaking CCUS projects being built up by OGCI Climate Investments, alongside collective action by member companies to facilitate the emergence of large-scale CCUS hubs, OGCI hopes to kickstart a commercially viable, safe and environmentally responsible CCUS industry that can contribute at the scale required.
Investing in CCUS
OGCI Climate Investments (OGCI CI) today announced its partnership with Starwood Energy and Elysian Ventures to develop one of the world’s first full-scale carbon capture facilities to be integrated into a natural gas power plant.
Using commercially available technology, the facility is expected to capture over 90% of the CO2 emissions from an existing combined cycle natural gas power plant. The captured CO2 will be used in oil recovery in conventional oil production and permanently sequestered in an existing oil field. The project will seek to use Section 45Q tax credits for the deployment of carbon capture projects once final regulations are implemented, including potential upcoming legislative enhancements. The project will be non-recourse financed, with construction of the facility expected to commence in early 2021.
This is Climate Investments’ fourth investment in CCUS projects, joining Net Zero Teesside (UK), Wabash Valley Resources (Indiana, US) and Elk Hills Carbon (California, US) to make a portfolio which, once operational, aims to capture over 9MT of CO2 per year. This is the equivalent to capturing the emissions of:
- 2 million passenger vehicles
- 1 million homes’ energy use
Kickstarting CCUS hubs
Simultaneously, OGCI’s CCUS KickStarter initiative, announced last September, is focusing on enabling multiple low-carbon industrial hubs. These use expertise from across OGCI’s membership to support the development of shared CCUS infrastructure that can help heavy industries to decarbonize and facilitate large-scale commercial investment in CCUS.
KickStarter began by adding their support to five emerging hubs in the UK, Norway, the Netherlands, China and the USA, which could, once fully operational, double the 35MT of CO2 that is currently stored globally per year. As these progress, OGCI is conducting a global search to identify potential hubs in around 25 additional countries, with the aim of helping those that are viable to mature.
Proof of OGCI’s success has been shown recently with Net Zero Teesside (NZT). One of OGCI CI’s first investments when the fund launched in 2017 and Hub 1 in OGCI’s KickStarter, – to move it one stage further towards operations.
As with all emerging technologies, a catalyst is needed to facilitate widespread deployment and investment – and that’s exactly what we aim to be.
To learn more about OGCI Climate Investments’ partnership with Starwood Energy and Elysian Ventures, please click here
OGCI Climate Investments’ CCUS portfolio could capture over 9MT of CO2 per year – the equivalent emissions of:
ABOUT OGCI CLIMATE INVESTMENTS:
OGCI Climate Investments is a $1B+ fund that invests in solutions to decarbonize sectors like oil and gas, industrials and commercial transport. We look for outcomes that reduce methane and carbon dioxide emissions, and that can recycle or store carbon dioxide. Achieving significant impact requires global implementation and commercial frameworks – at OGCI Climate Investments, we collaborate with innovators, investors and governments to fund and implement impactful solutions.
To learn more about OGCI Climate Investments, please visit www.oilandgasclimateinitiative.com/climate-investments
The Oil and Gas Climate Initiative is a CEO-led consortium that aims to accelerate the industry response to climate change. OGCI member companies explicitly support the Paris Agreement and its aims. As leaders in the industry, accounting for over 30% of global operated oil and gas production, we aim to play an active role in shaping the global pathway to net zero emissions. We do this by leveraging the collective strengths of OGCI, continually improving, and building on good international corporate practices to reduce greenhouse gas emissions and accelerate transitions to a low-carbon future. OGCI member companies include BP, Chevron, CNPC, Eni, Equinor, ExxonMobil, Occidental, Petrobras, Repsol, Saudi Aramco, Shell and Total.
To learn more about OGCI, please visit https://oilandgasclimateinitiative.com/