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In the fight against climate change, most GCC countries have set ambitious net-zero targets. Within these commitments, Carbon Capture, Utilization, and Storage (CCUS) plays a crucial role in decarbonization in hard-to-abate industries—those whose carbon emissions are technically difficult to eradicate with existing technology.
There is just one problem: the road to CCUS has no actual road. Countries have yet to address how to get CO2 from point A to point B, let alone tackle the many associated questions, from operating and pricing models to regulatory treatment. We need to put the “T”—for “transmission”—into CCUS if we are to make it a reality.
Executive summary
“CCUS” accurately sums up the debate: whether it is best to “capture” emitted “carbon” through direct-air capture or point sources; whether the captured carbon could be “utilized” to create more sustainable transportation e-fuels; and whether to “store” it in, say, depleted gas reservoirs or deep saline aquifers, or to mineralize it into rocks for the long term. All well and good. But consider legacy natural gas transmission and distribution: those networks took decades and billions of dollars to build. As with natural gas, there can be no capture, usage, and storage of CO2 without a way to move it.
CO2 can only efficiently be moved through a pipeline network. Transmission will most likely become a network business, much like traditional gas transmission. But developing and operating efficient CO2 transmission is complex in many respects. On the technical level, pipeline material must be able to withstand the corrosive nature of CO2 and the shockwaves caused by compression (the pipeline must operate at high pressure to achieve single-phase flow). Given CO2’s inherently hazardous nature and the dangers posed by even low releases, pipelines require special design considerations. CO2 leaks cannot be addressed in the same (or a similar) way as natural gas leaks. Another significant hazard is that CO2 tends to collect in low-lying areas close to the pipeline because it is heavier than air.
Some GCCs (like the UAE) are making progress by launching CCUS pilots and setting national volume targets, but discussion on the “midstream” issues has been lacking. Given their ambitious net-zero goals, GCC countries need to invest in an independent CO2 transmission infrastructure. That need is as massive as it is urgent. Connecting key industrial hubs like Jubail, Yanbu (Saudi Arabia), Jebel Ali, Ruwais (UAE), Ras Laffan (Qatar), Al Zour (Kuwait), and Sohar (Oman) to depleted gas reservoirs and saline aquifers in their respective countries would require thousands of kilometers of CO2 pipeline at a cost likely at a cost of billions of dollars.
We envision three possible operating models within which CO2 transmission network development could be achieved:
One entity would control and manage a single, end-to-end CO2 value chain. Pilot projects often follow this model. For example, ADNOC’s initial CCUS project at Al Reyadah will capture 800,000 tons of CO2 each year from a steel plant and inject it into the subsurface nearby.
This national champion-based model integrates multiple emitters to a common CO2 carrier through a hub-and-spoke design. Norway’s 1.5 million ton-per-year Longship CCS project, for example, will create a dedicated TSCo (Northern Light) that operates an open-access, multi-modal CCS value chain that transports the emissions of a variety of manufacturers, including petrochemical and cement companies.
This multiplayer model is being adopted across emission hubs or across the CO2 capture, transmission, and utilization/storage value chain. With its 2030 goal of 30 million tons/year of CO2 storage capacity, the U.K. has awarded 21 licenses to 14 different companies for capture and storage at offshore sites.
In the GCC, the TSCo model is likely to become increasingly attractive as countries build the scale of their CO2 value chains. This model connects multiple emissions hubs to sites for long-term CO2 sequestration and enables countries to establish a new transparent, regulated asset base that can provide a critical service for hard-to-abate industrial emitters.
With national decarbonization ambitions already well defined, every GCC country now needs to accelerate efforts towards developing what we call a National Carbon Management Regulatory Framework. Sector governance structures and operating and remuneration models of their CO2 value chains need to be carefully considered. Transmission regulations must also be considered in conjunction with existing oil and gas regulations, including rights-of-way, third-party access rights, pore space rights, and long-term storage liabilities. New partnerships need to be forged to develop technologies for safe and reliable CO2 transmission. Finally, investment models must be created to attract participation and large-scale capital in this critical and emerging sector.
There is much to consider, but these questions can no longer be postponed. Without transmission there can be no capture and storage. Transmission is a vital prerequisite to reaching net-zero ambitions. It is time to put the “T” on the table and make CCTUS happen.
This article originally appeared in Oil and Gas ME, January 2024.
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