Shell moves ahead with Canadian CCS project
Shell has made a long-awaited decision to proceed with Canada’s first large-scale carbon capture and sequestration (CCS) project
The C$1.35 billion ($1.35 billion) Quest facility will capture about 1 million tonnes of carbon dioxide (CO2) per year and store it two kilometres underground at the Scotford refinery near Edmonton, the capital city of Alberta.
The refinery is the main processing plant for mined oil-sands bitumen from the Athabasca Oil Sands Project (AOSP), where the a joint venture of Shell, Chevron and Marathon Oil is presently producing about 255,000 barrels per day (b/d) of oil.
At a media event in Calgary, company officials said Quest would reduce emissions from the Scotford upgrader by about 35%, or the equivalent of taking 175,000 cars off the road per year.
“If you want to achieve climate change goals, CCS has to be part of the solution”, said Peter Voser, Shell’s chief executive, in remarks accompanying the announcement. “We are helping to advance CCS technology on a number of fronts around the world, but Quest will be our flagship project.”
Quest is the world's first commercial-scale CCS project to tackle carbon emissions in the oil sands, and the first CCS project in which Shell will hold majority ownership and act as designer, builder and operator. It will also form the core of Shell's global CCS research programme and help develop Shell's carbon dioxide (CO2) capture technology, Voser said.
Both the Canadian federal and Alberta provincial governments have identified CCS as an important tool in their respective strategies to reduce CO2 emissions, but critics have complained the technology is prohibitively expensive without public support.
The Alberta government will invest C$745 million from a C$2-billion fund to support CCS, while the government of Canada will chip in an additional C$120 million of public funds.
Given that taxpayers are funding more than two-thirds of the project cost, formal approval was never in serious doubt.
In 2011, Quest received the world's first certificate of fitness for its storage development plan from Det Norske Veritas (DNV), an international risk management firm.
The International Energy Agency (IEA) calls CCS “a crucial part of worldwide efforts to limit global warming”, and estimates that it could deliver about one-fifth of necessary worldwide reductions in greenhouse gases by 2050. Shell is also working with governments and experts to help the development of CCS in other countries, including projects in Norway and Australia.
According to the Global CCS Institute, 15 projects are currently operating or in construction worldwide, capturing 35.4 million tonnes per annum of CO2. A further 58 large-scale integrated projects are in the planning stages, which would add more than 115 million tonnes per year of capture capacity, the institute said in its most recent update in June.