As governments and regulators push for a lower carbon future, the race is on to develop carbon capture technology. Even Elon Musk has joined the race, launching a $100 million carbon capture competition.
Exxon Mobil has stated this week that there could be a $2 trillion market for carbon capture by 2040. This comes as the company announces a $3 billion investment in carbon capture as well as carbon storage projects over the next five years.
Recent investments in new carbon capture technologies by European majors, including BP and Shell, have gained praise from the media and environmental organizations who believe it is a step towards greater sustainability for the oil and gas sector.
Oil companies acknowledge that they will be pumping oil and gas for decades to come. However, they are looking for ways to reduce carbon emissions to ensure that production is less harmful to the environment, while also investing in renewable energy research and development.
Many of these aims go hand-in-hand with the goals of the Paris Agreement, which was signed by 194 states around the globe by November 2020. As governments attempt to bring their national policies in line with the agreement, the oil and gas industry must follow suit.
Carbon capture is positive news for everyone, as President Biden seeks to encourage greater efforts to manage climate change without hurting oil-dependent states. To this end, Congress recently approved legislation on the continued research and development of carbon capture through 2025 by the Department of Energy.
Related Video: Fukushima's Radioactive Wastewater Disaster Biden is not the only one encouraging carbon capture, use, and storage (CCUS). This year, the UN announced the goal of net-zero emissions, calling on governments and companies to invest in capturing CO2 emissions from coal and gas power plants, and from heavy industry, for deep underground storage or re-use.
The UN has just produced a report on CCUS, outlining the current practices around the world as well as state-specific CCUS projects. The report aims to encourage other member states to invest in CCUS in order to reduce carbon emissions over the next decade.
However, investment in CCUS should not be taken lightly, with Europe needing an anticipated €320 billion to achieve successful CCUS deployment by 2050, as well as a further €50 billion for transport infrastructure.
At present, CCUS technologies do not have the capacity needed to remove enough CO2 to achieve carbon neutrality. This means that companies must look at other ways to become more carbon-friendly, as well as investing heavily in the improvement of CCUS mechanisms.
Related: Iran Pushes Development Of Major Oil Region Under 25-Year China Deal
The UAE announced this week that it is seeking new partnerships in CCUS and emissions-cutting as oil prices soar after a difficult year. Brent hit $70 as the OPEC+ states refused to bring more oil production online.
Sultan Al Jaber, the Minister of Industry and Advanced Technology and CEO of Abu Dhabi National Oil Company (ADNOC) stated, “There is no credible way of reaching global climate goals without seriously advancing and ensuring the widespread adoption of carbon capture and storage”.
So far, ADNOC has partnered with Total to advance its CCUS technologies, as part of its aim to reduce its carbon intensity by 25 percent over the next decade. Its aim is to capture 800,000 tons of CO2 via its Al Reyadah facility, as oil production steadily increases. The UAE expects to capture 5 million tons annually by 2030.
Both oil majors and states around the world are in the race to produce the more effective carbon capture technologies to bring oil and gas production in line with net-zero aims over the next decade. Greater investment and collaboration between governments and industry could prove effective in making sustainable oil production a real possibility.
By Felicity Bradstock for Oilprice.com
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