The carbon challenge

 


It’s Technology Centre Mongstad (TCM), currently under construction, is the world’s largest facility for testing and improving CO2 capture, supported by companies including Statoil, Shell and Sasol. TCM’s administration hub was unveiled recently by Norwegian energy minister Terje Riis-Johansen, a key step in the construction process, which is scheduled for completion in 2012.


“TCM is taking a leading position internationally through the establishment of a test facility for users of capture technologies and industrial partners which develop and provide such technologies,” the minister said.


Part of the rationale behind TCM is to reduce the costs of CCS to encourage a wider adoption among other countries internationally. It will test two different technologies, from Aker Clean Carbon and Alstom, for capture of CO2 from two flue gas sources with different CO2 content.

CCS constraints


Potentially, Africa – as one of the world’s fastest growing oil producing regions – could also become a key testing ground for these and other emerging carbon technologies. Environmental compliance is particularly strong for operators of mature reservoirs, who are gravitating toward the economic benefits of injecting captured CO2 for enhanced oil recovery. This is clearly apt in the case of some of the region’s more established oil producers. But despite the environmental pluses, cost remains a significant drag.


In some cases, as has already been shown, the captured CO2 can be used for EOR purposes, which often reduces, if not fully offsets, the costs associated with the capture. Indeed, innovators are already glimpsing an opportunity to turn GHG emissions into profit.


It will need innovative financing mechanisms to bridge the gap however, a trend that is already shaping developments elsewhere. For instance, financiers have drafted plans to make Dubai a regional hub for carbon offsets trade, which could turn the Middle East’ sizeable carbon footprint into cash.


But that may be some way off given the fairly limited activity on the ground to date in relation to the region’s huge oil production capabilities. Looking around that region though it is not difficult to find projects taking shape. The world’s biggest oil producer Saudi Aramco is currently experimenting with carbon capture technologies at the world’s largest oil field, Ghawar.


The state-owned company hopes to inject some 40mn standard cubic feet per day (cfd) of CO2 into the oilfield by 2012. The aim of the pilot project is to both improve production rates and at the same time reduce emissions levels. The Ghawar field pumped around 5 million barrels per day (bpd) in 2008, a large chunk of the kingdom’s entire output. With most of Africa’s producing fields considerably smaller there are once again clear economies to take into consideration.


The higher cost of doing business may slow the rollout of CCS projects in Africa but the continent – at some point – stands to benefit from the huge advances now being pioneered elsewhere. This includes research work in South Africa and operational projects in Algeria.

Alain Charles Publishing, University House, 11-13 Lower Grosvenor Place, London, SW1W 0EX, UK
T: +44 20 7834 7676, F: +44 20 7973 0076, W: www.alaincharles.com

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