dr ward goldthorpe
TRANSCRIPT
Development of an Offshore CO2 Storage Industry
Dr Ward Goldthorpe
Getting Carbon Capture Moving FasterCarbon Capture Journal8 October 2012, London
Affordable energy for consumers Greenhouse emissions
to be strongly mitigated in 40 years or less
Society’s Challenge
Emissions mitigation will take place in a time‐constrained economic system – not an evolutionary free market
The Crown Estate’s Storage Rights
Within the territorial limit (12nm)•Owner of the seabed• Property rights over surface and sub‐surface
On the UK continental shelf• UK Gas Importation and Storage Zone• Vested rights under the Energy Act 2008
The Crown Estate’s Objectives
Work with UK government to facilitate deployment of large scale CCS projects during the next 5‐10 years
Prepare for competitive storage leasing and project selection beyond the UK commercialisation programme
Developing the Market for CO2 Transport and Storage (CTS) Services
Demonstration• Capital and FiT support• Risk allocation• Site access
Transition• Targeted Support mechanisms
• Fiscal incentives• Regulation reform
Market• Value transfer• Competitive services
•Market returns
HOW?
WHEN?
What is the market commodity?
Is it low carbon electricity?• NO
Is it low carbon industrial products?• NO
Is it avoided emissions?• YES
Deployment Driven via Electricity Market
Power Generation +
Capture
•EMR Mechanisms•Electricity market competition• EMR Mechanisms•Electricity market competition
Storage•Dependent on generator FIDs
•Requires matched lead times
• Sequential deployment
•Dependent on generator FIDs
•Requires matched lead times
• Sequential deployment
Transport•Point‐to‐point solutions• Tailored capacity• Point‐to‐point solutions• Tailored capacity
Deployment Driven via CTS Services
Storage
•Exploration/appraisal lead times•Accessible certified sites •Clusters by design•Resource Optimisation
•Exploration/appraisal lead times•Accessible certified sites •Clusters by design•Resource Optimisation
Transport
• Source and sink clusters• Economies of scale•Networks by design
• Source and sink clusters• Economies of scale•Networks by design
Power + Industry Capture
•Source clusters •Collaboration• Source clusters •Collaboration
Deployment Driven via Economic Value‐add
• Natural Gas processing and LNG• Natural Gas processing and LNG
Australia
• Oil sands production and CO2 Enhanced Oil Recovery• Oil sands production and CO2 Enhanced Oil Recovery
Canada
• Natural Gas processing• Natural Gas processing
Norway
• CO2 Enhanced Oil Recovery• CO2 Enhanced Oil Recovery
United States
Creating a Positive Feedback
CO2Transport & Storage
Power Generation + Capture
•Electricity Market Reform•Carbon Price Floor
•Point‐to‐point solutions• Sequential deployment•Potential step‐outs
•Development of source clusters with industry
• Economies of scale•Cost Reduction
•Exploration, appraisal and certification
•Resource optimisation•CTS by design
VALUE FLOW FROM CfD FiTs
VALUE FLOW FROM AVOIDED CARBON
Investment and
Financing Risk
Appraisal and characterisation
lead times
New technical and consenting
standards
Unrealistic financial
securities and guarantees
Post‐closure transfer criteria
Co‐location of different licensing regimes
Cross‐border transportation restrictions
Intrinsic Inertia for CTS Deployment
Crown Estate Activities
• Spatial planning• Resource assessment and management• Facilitating access to storage sites• Infrastructure planning• RD&D and Joint Industry Projects• Market‐making business models
• Spatial planning• Resource assessment and management• Facilitating access to storage sites• Infrastructure planning• RD&D and Joint Industry Projects• Market‐making business models
Adding value to the sector
• Designing lease competitions• Selecting projects• Designing lease competitions• Selecting projects
Commercial Leasing
Managing Infrastructure Design and Deployment
Offshore Facilities
Co‐location InteractionsCo‐location Interactions
Flight Exclusion Zones
Flight Exclusion Zones
Safety Exclusion Zones
Safety Exclusion Zones
SeabedTransmission
GridTransmission
Grid
Pipeline NetworkPipeline Network
CablesCables
Aggregates and Minerals
Aggregates and Minerals
CoastCable and Pipe
CorridorsCable and Pipe
Corridors Coastal CrossingsCoastal Crossings InterconnectsInterconnects
Strategic RD&D Objectives
Robust evaluation and selection of storage
proposals
Robust evaluation and selection of storage
proposalsGeostatistics and probability density functions for reservoir and aquifer site characterisation
Measurement, monitoring and verification techniques
Corrective measures and remedial action
Facilitate optimised CO2transport and storage
infrastructure development
Facilitate optimised CO2transport and storage
infrastructure development
Aquifer injectivity, pressure management, and containment
Pipeline standards and network/cluster design
Offshore CO2 enhanced oil recovery with storage
Non‐technical Site Leasing Issues
•DEVELOPMENT•Access and Transfer Arrangements
• Liability Treatment
•DEVELOPMENT•Access and Transfer Arrangements
• Liability Treatment
• ENHANCED OIL RECOVERY•Co‐existing Licences/Lease
•Carbon Accounting
• ENHANCED OIL RECOVERY•Co‐existing Licences/Lease
•Carbon Accounting
•APPRAISAL•Access• Liability and Interface Conditions
•APPRAISAL•Access• Liability and Interface Conditions
• EXPLORATION•Co‐location• Interface Arrangements
• EXPLORATION•Co‐location• Interface Arrangements
Saline Formation
Field Extension
Depleted Field
Producing Field