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CO2 Transport and Storage

Not on track
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About this report

In the Net Zero Emissions by 2050 Scenario, CO2 transport and storage infrastructure underpins the widespread deployment of carbon capture, including carbon dioxide removal (CDR) via direct air capture with storage (DACS) and bioenergy with CCS (BECCS). There are currently around 9 000 km of CO2 pipeline – mainly in North America – and 7 dedicated geological CO2 storage operations with a combined capacity of 10 Mt/year. Based on projects currently in the early and advanced stages of development, dedicated CO2 storage capacity could reach around 110 Mt CO2/year by 2030, which is far less than the nearly 1 200 Mt CO2/year that is captured and stored by 2030 in the Net Zero Scenario. CO2 transport infrastructure will need to increase at least at the same rate as capture and storage capacity.  

CO2 emissions

A growing number of projects are choosing to focus either on CO2 capture or on CO2 transport and storage. A “part-chain” approach can reduce commercial risks and promote efficiencies, but relies on close coordination and alignment in the development of each element of the CCUS value chain. With growing plans to equip facilities with CO2 capture, spurred by strengthened climate goals, a gap is starting to emerge between anticipated demand for CO2 storage and the pace of development of storage facilities. In the absence of further efforts to accelerate CO2 storage development, through government or private-sector exploration, the availability of CO2 storage could become a bottleneck to CCUS deployment. This is currently demonstrated in the project pipeline, where global demand for CO2 storage could exceed anticipated supply by over 60 Mt CO2 in 2030. 

Currently there are around 90 full-chain CCUS projects and more than 150 CO2 capture-specific projects in development. Most capture-specific projects aim to store CO2 in one of the 40 CO2 storage hubs under development. In some cases, full-chain projects may choose to expand their CO2 storage infrastructure in later phases to create a storage hub. The Ravenna hub in Italy and the Polaris CCS hub in Canada are two such examples of projects considering this. 

Annual CO2 storage capacity, current and planned vs Net Zero Scenario, 2020-2030

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Annual CO2 capture capacity vs. storage capacity, current and planned, 2020-2030

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Currently the majority of projects choose to develop transport and storage together. CO2 transport infrastructure moves CO2 from its point of capture to either a point of use or a point of storage. Multiple modes – barge, pipeline, ship, train and truck – can be used to transport CO2. Of these modes, pipelines and ships are the most scalable options with the lowest cost per tonne of CO2

Pipelines that transport CO2 captured at multiple sources can support the widespread deployment of CCUS. In Canada, the 240 km Alberta Carbon Trunk Line has a capacity of 14.6 Mt CO2/year even though it currently only transports some 1.6 Mt CO2/year from two sources. Commissioned in 2020, the pipeline was designed with significant excess capacity so other facilities can be attached in the future. Multi-user CO2 pipeline networks are being developed globally; examples include the Midwest Carbon Express in the United States, an offshore CO2 pipeline connecting Belgium with Norway, and the Delta Corridor connecting parts of Germany and the Netherlands.  

While merchant CO2 shipping has been demonstrated on a small scale (around 2 000 t or less), large-scale shipping of CO2 has not yet been demonstrated. Currently two ships are under construction as part of the Northern Lights project and more are being designed by other projects. Barges to transport CO2 on inland waterways are also being considered by some projects. CO2 transport by barge or ship requires different conditioning – in terms of phase, temperature and pressure – than CO2 transported by pipeline. CO2 terminals are required for waterborne transport in order to load and unload the CO2 and ensure that it is properly conditioned for further transport and injection. Several CO2 terminals are in development, including at the Port of Antwerp in Belgium, the Port of Gdansk in Poland, the Port of Gothenburg in Sweden, Dunkirk harbour in France, and in Germany as part of the BlueHyNow project. Additionally, ship-to-platform and ship-to-well delivery are being explored and may be deployed in the future, reducing the need for unloading terminals. 

Based on the current project pipeline up to 2030, it is likely that more than 50% of captured CO2 will be stored at dedicated storage sites. This represents a large shift away from CO2-EOR towards dedicated CO2 storage. Today nearly 75% of captured CO2 is used for CO2-EOR, more than 20% is stored in seven dedicated storage sites, and the remainder is used in other applications such as greenhouses and to produce industrial products. While much of the CO2 injected for CO2-EOR is retained in the subsurface, practices need to be optimised if CO2 injected for this purpose is to be considered stored. CO2 accounting practices also need to be agreed upon.

Operating and planned CO2 storage facilities by storage type as of 2022

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Deployment

By capitalising on both economies of agglomeration and scale, multi-user CO2 transport and storage infrastructure can support decarbonisation of entire industrialised zones. Recently there has been an evolution towards the development of multi-user transport networks and storage hubs; overall, about one-third of CO2 transport and storage infrastructure in development is multi-user. 

CO2 storage infrastructure in development by region as of 2022

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By capitalising on both economies of agglomeration and scale, multi-user CO2 transport and storage infrastructure can support decarbonisation of entire industrialised zones. Recently there has been an evolution towards the development of multi-user transport networks and storage hubs; overall, about one-third of CO2 transport and storage infrastructure in development is multi-user. 

A number of the transport and storage projects currently in development are associated with industrial clusters. Examples include:  

  • Four transport and storage projects attached to five industrial clusters in the United Kingdom. 
  • The Porthos project in the Netherlands, to transport CO2 from Rotterdam-Zuid to offshore storage sites.  
  • The Houston CCS hub in the United States.  

Multi-user infrastructure can support the deployment of CO2 capture in smaller emitters and also the diversification of CCUS business models and transport modes. Examples include the following: 

  • Three projects in the United States aim to construct over 5 800 km of pipeline to move CO2 captured at a high number of relatively small emitters (more than half averaging below 0.2 Mt CO2/year) to storage sites.  
  • As a part of the Longship CCS project, the Northern Lights Project in Norway intends to transport CO2 via ship from the two capture plants associated with Longship to a receiving terminal, where CO2 will then be transported by pipeline offshore to the storage site. It will be the first time CO2 is transported by ship for the purpose of storage. The project has positioned itself as a transport and storage service provider and plans to offer its services to other sources in the future.  
Innovation

Dedicated CO2 storage has been the subject of significant research, development, and innovation, including piloting and commercial-scale demonstrations.  

Monitoring, measurement and verification technologies continue to be developed. This work can improve storage performance and safety, reduce costs and potentially improve CO2 storage development times.  

CO2 mineralisation, where CO2 is injected into basalts or peridotites, is also becoming increasingly developed. These rocks contain a higher fraction of CO2-reactive minerals, which can accelerate the precipitation of carbonate minerals compared to conventional storage. In Iceland, Carbfix is demonstrating dissolved-CO2 injections for the purpose of mineralisation and has injected around 85 000 t since 2014. Supercritical injection of CO2 into basalts was piloted during the Wallula Basalt Pilot Demonstration Project in Washington, United States. Numerical modelling from both of these projects suggests that significant mineralisation can occur within two years of injection. Additional piloting and demonstration of CO2 mineralisation could support the scale-up of this type of storage.

In specific circumstances, existing pipelines and other infrastructure can be reused for CO2 transport and storage. Repurposing can be attractive because it can reduce the overall cost and time of infrastructure development, lengthen infrastructure life before decommissioning and, in the case of pipelines, potentially reduce access requirements and landowner compensation. Several projects in development, including the Acorn Project in the United Kingdom, plan to reuse existing infrastructure. Only limited repurposing has occurred thus far; to facilitate it, infrastructure owners should be encouraged to incorporate a reuse audit in their decommissioning process.  

Currently the food and beverage industry is the main shipper of CO2. It usually transports CO2 at medium pressure (13 to 18 bar and -30°C to -28°C) as users have no need to move high volumes and do not require large cargos. Low-pressure CO2 ships (6.5 to 8.7 bar and -45°C to -41°C) are able to have larger tank volumes and cargo capacities than medium-pressure carriers due to the temperature and pressure at which they operate. This can potentially reduce transport costs. There is significant potential for spillover learning from the LNG and LPG trade. However, further research and development is needed to support development of low-pressure CO2 ships and their deployment. The International Organisation for Standardization has convened a working group (ISO/TC 265/WG 7) on the transport of CO2 by ship in order to better understand the technical requirements for a future CO2 shipping standard. 

Policy

Countries and regions have recognised the importance and urgency of developing CO2 transport and storage infrastructure. A number of countries have recently enacted policies: 

  • The United States Infrastructure Investment and Jobs Act, signed into law in 2021, includes around of USD 5 billion in support for CO2 transport and storage development. The Inflation Reduction Act of 2022 will also support the deployment of CO2 transport and storage. It increases the value of the 45Q tax credit for CO2 stored in dedicated storage sites and injected for CO2-EOR. It also extends the beginning of construction deadline from 2026 to 2033 and reduces the size threshold.  
  • Canada’s Budget 2022 defines a CCUS Tax Credit of 37.5% for eligible transport, storage and use equipment. Additionally, in March 2022 Alberta announced that six potential CO2 storage hubs will advance to the next round of consideration.  
  • Denmark intends to devote at least USD 2.2 billion to CCUS development, including transport and storage infrastructure. In 2021 the country also provided grant support to Project Greensand and Project Bifrost, both of which target offshore CO2 storage development. 
  • The European Commission updated its TEN-E regulation to make geological CO2 storage infrastructure eligible to receive subsidies through the Connecting Europe Facility subsidy scheme.  
  • In 2021 Korea announced plans to invest up to USD 1.2 billion into CCUS development up to 2030. About 30% will go towards storage resource assessment, while the majority of the fund is earmarked to support demonstration of CCUS. 


Investment

The seven full-chain CCUS projects that took positive final investment decisions between January 2021 and August 2022 could potentially add transport and storage capacity of up to 7.5 Mt CO2/year. However, a number of these projects include CO2-EOR and may already be connected to existing pipelines for transport. That said, more than 10 full-chain projects and 5 transport and storage hubs plan to take final investment decisions in the latter part of 2022.  

International collaboration

Until 2019 the London Protocol was considered a major international legal hurdle for the development of regional CO2 transport and storage infrastructure because it effectively prohibited the export of CO2 for the purpose of storing it offshore. In 2019 contracting parties to the protocol formally accepted a resolution that allows countries to agree to export and receive CO2 for offshore geological storage via bilateral (or multilateral) agreements. In September 2022, Denmark and Flanders, Belgium signed a landmark agreement to allow for CO2 transport for the purpose of offshore storage. As of yet, no other agreements have been announced, however, the Netherlands and Norway signed a memorandum of understanding in November 2021 agreeing to finalise a bilateral agreement in 2022. International collaboration will be essential to ensure that the necessary agreements are put in place to allow for CO2 to be transported to other countries for its storage offshore. 

Recommendations for policy makers

CO2 storage assessment and site development can take three to ten years, depending on the amount and quality of existing geological information. Therefore, countries without an overview of their storage resources should start preliminary pre-competitive assessments as soon as possible. Government organisations such as geological surveys can be well-positioned to manage resource assessment, and governments should also consider if state-owned enterprises should have a role in the storage assessment and development process. Assessment should be done in a standardised way, such as with the Storage Resource Management System (SRMS), which has received industry backing and is being used by the Oil and Gas Climate Initiative (OGCI) in their CO2 Storage Resource Catalogue.  

Once resources have been assessed, source–sink matching – wherein the geographical location of CO2 storage sites and CO2 storage resources are matched against capacity and other criteria – can be used to determine if available resources are likely to be sufficient, and how to develop optimised CO2 transport infrastructure.  

As a first step in developing storage resources, countries should review existing laws and regulations that cover CO2 storage activities. In some countries this may fall under oil and gas regulations, drinking water regulations, or mining regulations, to name a few. If there are any gaps in regulatory frameworks, or if such laws or regulations do not exist, countries should consider adopting CCUS frameworks that ensure the safe and secure storage of CO2.  

Given the need to roll out CO2 transport and storage infrastructure in a safe and timely manner, regulators should ensure that the relevant authorities have sufficient internal capacity to review and process permitting applications. Regulators could consider defining strategic projects, which can benefit from a streamlined permitting process. One such example of this is the European Project of Common Interest status as defined by the TEN-E regulation.  

Both the World Bank and the Asian Development Bank have trust funds that have supported CO2 storage resource assessments in a number of emerging markets and developing economies. These two trust funds are set to expire by the end of 2023. Given the importance of deploying CCUS in these countries to support their ongoing development while pursuing decarbonisation goals, storage resource assessments should continue to be the target of international cooperation and multilateral support. To that end, in 2021 the US Department of Energy and the US Geological Survey signed a memorandum of understanding to cooperate on assessing global, regional and national CO2 storage resources. However, this commitment does not replace the need for dedicated multilateral finance initiatives.

Recommendations for the private sector

CO2 transport and storage infrastructure is the critical enabler of CO2 capture deployment. The private sector should capitalise on competencies to develop CO2 transport networks and CO2 storage hubs with a view towards developing a robust CO2 management industry. Developing such infrastructure can help companies that have traditionally been fossil-fuel focused, such as natural gas transmission service operators and oil and gas companies, diversify their business lines and create new revenue streams.

Acknowledgements
  • James Craig, Technology Collaboration Programme on Greenhouse Gas R&D/IEAGHG 
  • Iain MacDonald, Shell
  • Nirvasen Moonsamy, Oil and Gas Climate Initiative 
  • Julien Perez, Oil and Gas Climate Initiative  


Analysis