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    Europe to See $35bn in CCS Spending Till 2035: Rystad


Europe's carbon storage capacity could reach 75mn mt/yr by 2035, according to the Norwegian consultancy.

by: Joe Murphy

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Europe to See $35bn in CCS Spending Till 2035: Rystad

The development of carbon capture and storage (CCS) technology has reached the point where large-scale projects make financial sense and this could trigger up to $35bn in development spending between now and 2035, Oslo-based Rystad Energy said in a report on September 7.

There are 10 large-scale CCS schemes underway in Europe that have a high chance of becoming operational by 2035. Many of them are around the North Sea in Norway, the UK, Denmark and the Netherlands.

Most of the schemes are due online from the middle of this decade, but investments and contract awards to suppliers will start growing significantly between 2021 and 2023. Around half of capex will go towards the facilities at the source, with CO-capture equipment and facility construction accounting for the bulk. Storage investments will account for 15% while transport and operations spending will amount to 35%.

The first three projects due to start up are Acorn CCS in the UK, Northern Lights in Norway and Porthos in the Netherlands, and these will be "game-changing" in de-risking CCS technology and encouraging more schemes, Rystad said. CCS capacity in Europe is set to grow 3mn mt/yr between 2021 and 2025 and then increase by 7mn mt/yr until 2030, the consultancy said, forecasting that total capacity would reach 75mn mt/yr by 2035. More than 80% of this capacity will be at UK projects.

Developing the CCS sector will also provide opportunities for linepipe and oil-country tubular goods (OCTG) suppliers to branch out of oil and gas, Rystad noted.

"Several European policymakers and non-governmental organisations (NGOs) have previously indicated they are ready to rule out CCS as a climate mitigation tool, saying the technology is not proven and available and has unrealistic expectations. For CCS to have a significant future, it’s therefore important that Northern Lights and Acorn run through their pilot stages to show that this can be a proven technology," Rystad's head of energy service research, Audun Martinsen, said. "“As standard renewable technologies that have some maturity in Europe such as solar installations and offshore wind farms are increasingly gaining market share, CCS projects will face competition and have to prove cost-worthy."