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Norway putting CCS to the test despite costs and delays

Norway is set to be the proving ground for large-scale carbon capture and sequestration. Despite delays and spiralling costs, the country's hope to be the first to develop a commercial, industrial-scale facility may become reality. Justin Jacobs reports from the Mongstad test facility

If the world is going to continue burning fossil fuels, carbon capture and storage (CCS) will have to be a critical tool in the fight against climate change, the International Energy Agency (IEA) warned in a July roadmap report for the technology. It was the latest in series of similar calls made over the past few years to try and rally greater political and industry support for CCS.

Yet development of CCS - a suite of technologies that captures carbon dioxide (CO2) emissions from power plants and other industrial sites and transports the greenhouse gas to underground reservoirs for storage - has been painfully slow. Although the individual components involved in the CCS process have been in use for some time, they have still not yet been brought together in an industrial-scale commercial project. The technology has been hampered by high costs and a lack of incentives, most notably an adequate carbon price, to make it commercially viable.

The Mongstad CCS project, an industrial-scale carbon capture test site situated in the picturesque fjords near Bergen on Norway's west coast, hopes to change that.

"We want to show the world and show the industry that we are able to test and develop this technology," Frank Ellingsen, the managing director at CO2 Technology Centre Mongstad (TCM), said during a recent visit to the site.

The $1bn project has received strong backing from the Norwegian government. State-run Gassnova holds a 75.12% stake in the project, while state-controlled oil company Statoil operates the plant and holds a 20% interest. Shell and South Africa's Sasol each own a 2.44% stake. In 2007 New Year's Day speech, Norwegian prime minister Jens Stoltenberg famously said that developing a commercial scale CCS project at TCM was his country's "moon landing".

Since Stoltenberg's speech, the project has since been beset by delays, higher than expected costs and scepticism about the CCS' viability. If the project does move from the testing phase into the commercial stage, it will likely have taken longer than it took the US to get to the moon in the 1960s. But progress is being made at the project, and it is undoubtedly contributing to the advancement of CCS.

"It is a technology that I'm convinced will be there in the long run. It might not have some of the elegance and glamour of some of the other energy technologies, but... it is real, it is large scale, and it is happening," said Bill Spence, the head of Shell's CCS programme said at TCM.

The Mongstad industrial site offers an ideal testing ground for integrated CCS technology. The carbon capture facility, with its two CO2 processing towers jutting into the sky surrounded by a tangle of gleaming steel pipes, sensors and pumps, sits between the 200,000 barrel a day (b/d) Mongstad refinery and a combined-cycle gas power plant. It is the world's largest and most advanced such test facility, and one of only a few that are operating on an industrial scale. Being near an oil refinery and power plant allows the site to simulate a number of different potential sites where CCS plants could be built.

Since opening in May 2012, energy service companies Aker and Alstom have taken over the CO2 processing towers to test technologies they developed in the lab at an industrial scale. Aker has been testing a carbon capture technology using an amine solution.

The process is relatively straightforward. Emissions from the power plant or refinery are captured before being released into the atmosphere, then pumped into the bottom of the processing tower where it flows up through the tower and mixes with the liquid amine solution. The solution absorbs around 85% of the CO2 in the gas. That CO2-infused amine solution is then pumped to a separate unit where the CO2 can be stripped from the amine. Alstom has been testing a similar process, but using chilled ammonia solution to absorb the CO2.

For now, the captured CO2 is discharged - Ellingsen calls it "catch and release". But the project's owners hope to make a final investment decision to add a transport and underground storage component to the facility by 2016 or 2017, Ellingsen said.

During the initial test phase, though, the project is focused on building a body of knowledge about how carbon capture works on a large scale and passing that knowledge on. "What we need to push this technology forward is to share knowledge, to push each other and share what we have learned in a global community," Ellingsen said. In spite of slow progress in CCS, Ellingsen says that interest in Mongstad CCS' work remains strong, with a steady stream of delegations from around the world visiting the plant.

And TCM hopes to bring more partners into the project. The amine test unit will be available in 2014, after Aker's contract runs out, and there has been strong interest from Aker, which may be interested in remaining at the site, Siemens, as well as Japanese companies Hitachi and Mitsubishi. TCM expects to name a winner by the end of 2013.

TCM is also making an unused part of the site available for a new stakeholder. Ellingsen declined to name any of the interested companies, but said nine companies had already registered their interest and the facility was in talks with 11 more companies.

TCM is looking for companies with the financial strength and entrepreneurial culture to help push CCS from the testing phase into commercial operation, Ellingsen said. "Not all companies are able of carrying a technology into the market... if you look at Aker and Alstom these are companies which have a history of commercialising different products."

Up to now the burden for investing and providing financial incentives for CCS has largely rested on governments, but industry will have to take the torch if the technology is ever going to be deployed at the scale necessary to be an effective tool in the fight against climate change.   

The IEA has set out a roadmap for the technology if it is to help avoid warming of greater than 2°C, a crucial barrier according to many climate scientists. Given the current state of the industry it is an ambitious target.

By 2020, according to the IEA's 2°C scenario, carbon capture should be successfully rolled out in at least 30 power generation and industrial sites around the world, with 50m tonnes per year (t/y) of CO2 being captured and stored. To reach that goal, every major project currently are on the drawing board will have to come to fruition in the next half decade and several more will have to be quickly planned and put into operation.

By 2030, CCS would have to routinely be used across power generating and industrial sites around the world, with 2bn t/y of CO2 being captured and stored each year. By 2050, CCS would have to be in use at virtually all power generation and industrial sites in the world, with 7bn t/y of CO2 captured and stored.

Of the supermajors, Shell has been one of the biggest backers of CCS technology. The company is convinced that, like all other energy technologies, the costs for CCS will come down as it is developed, and that Mongstad will play an important role in that process.

"What we're finding, which is really clever, and which is really unique to Mongstad, is instead of all these companies having to build these enormously expensive test facilities in their back gardens around the world they are able to come here and share the costs... shared facilities like this will help us get a fast start," Shell's Spence said.

Shell also wants to be ready if the politics of climate change and energy policy move in CCS's direction. "The mandate given to me is to make sure Shell is ready to deploy CCS if and when it is needed. It's about being ready. If the government tomorrow flips and we need to do it I want to know that I can flip a switch and we can get after it."

Offshore storage a work in progress

At the Mongstad carbon capture and storage (CCS) test project Norway is building on two decades of experience with the technology.

Statoil developed the world’s first commercial CCS project at the Sleipner West gas development, in the Norwegian sector of the North Sea, in 1996. That the development has been on stream for 17 years serves as a reminder of Norway’s pioneering efforts with CCS, but also of how slow the take-up of CCS technology has been.

The project proved that, in the right environment, CCS was not only possible, it was feasible. Statoil invested around $100m to develop a compact carbon capture and processing unit that could be deployed on the Sleipner West platform 250 km off the coast, where space is at a premium.

The carbon dioxide (CO2) is captured using an amine-based process and injected into the Utsira formation, which lies 800 metres below the seabed. Around 1m tonnes of CO2 per year from the Sleipner West field are stored underground.Two factors pushed Statoil towards developing the Sleipner West CCS project. Initial tests at the site in 1990 found that gas produced from the field contained relatively high CO2 levels of around 9%, far higher than the 2.5% level needed to sell the gas on.

But the more important step came in 1991, when the Norwegian government implemented one of the world’s first carbon taxes. Most of Norway’s power comes from CO2 emissions-free hydro generation, so the tax targeted offshore oil and gas operations, the primary source of the country’s emissions. That provided the financial incentive to capture and store CO2, rather than vent it into the atmosphere.

Capturing and storing CO2 from the field allows Statoil and its partners, ExxonMobil and Total, to avoid the carbon tax and earn credits under the country’s emissions trading scheme. The amount saved has varied as the tax has been tweaked over the years, but this year the Norwegian government nearly doubled the carbon tax for offshore oil and gas operations from 210 kroner ($34.53) a tonne to 410 kroner/t.

The Norwegian government’s strict emissions regulations were also instrumental in the development of a CCS facility at the Statoil-operated Snøhvit liquefied natural gas (LNG) export project in Hammerfest. There, CO2 is stripped from the produced gas before it is liquefied, and is then piped to an offshore reservoir in the North Sea for storage. Around 700,000 tonnes of CO2 are captured and stored from the project each year, according to Statoil.

The project, though, has run into problems. In 2011, about three years after the first CO2 was injected into the Tubåen formation, the company said that pressure was building up in the reservoir far quicker than it had expected, indicating that it was filling up. Statoil said that it would drill an additional injection well, and in June this year it awarded a contract to Technip for pipeline and subsea installation related to the new well. If that is not successful, Statoil could eventually have to find another reservoir to inject CO2 from Snøhvit.

The problems at Snøhvit highlight a broader risk in the storage stage of the CCS process. As the International Energy Agency warned in its latest CCS technology report, “Some [storage sites] may be found to be unsuitable only after considerable sums have been spent on characterisation, and some may perform more poorly than anticipated during operations.” Indeed, there are still such risks and unknowns at each stage of the process. Norway has made progress developing the technology, but CCS remains very much a work in progress.

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