WSS Energy recently completed a project to model the likely future development pathway for CCUS hubs globally. The project, for an international trading company, aimed to determine how many CCS injection wells were likely to be completed by 2030 and 2050 in Europe, North America, Canada, SE Asia and the MENA region.
The CCS hub concept, where point-source emitters are linked to onshore and offshore injection sites, has emerged as the most feasible commercial route for reservoir sequestration, as infrastructure costs are shared across multiple companies who access the hub either through JVs or offtake agreements. Each emitting company is responsible for their own CO2 point-source capture, and provides captured CO2 into the hub infrastructure at an agreed specification and volume.
Developing a model for an emerging and uncertain new industry was challenging. Given the comparatively young age of the ‘at-scale CCS concept’ a large number of global CCS projects are at an early stage of development with concept studies as opposed to engineering studies being progressed so far. Therefore, the available information is often subjective in nature and it required a niche metric to incorporate this data into the model.
Initially we divided the globe into several regions and conducted a PESTEL analysis for each region to understand the major political, environmental and socio-economic drivers that would hinder or support CCS development.
Subsequently we scrutinised the available literature on each announced CO2 capture and storage/CO2 storage project and the various potential geological locations for storage. We were able to identify the projects in each region that were developing, most developed or most likely to develop as well as their projected development timeline alongside the most viable storage locations.
Having obtained this data, we subjectively analysed the PESTEL results in conjunction with the development status of individual projects and the availability/ease of access to geological storage locations. In doing so we developed a ‘likelihood’ for each project developing to active scale by 2030 and 2050 in low, medium and high growth scenarios. By incorporating a consistent ‘average injection rate per well’ it was possible to predict the injection rate of each project and therefore the CO2 storage capacity for each region in 2030 and 2050.
The model results showed huge potential for the USA and Canada, driven by different factors. In the USA the financial support provided by the IRA, the relative ease of infrastructure development and huge sequestration potential are likely to lead to at-scale and commercial projects becoming operational by 2030, with expected double digit growth in the years after. In Canada, the tight spread of industry adjacent to storage locations, the decarbonisation imperative on the domestic oil & gas industry and strong provincial support has resulted in 19 projects being progressed through early studies. Many of these are expected to fail, however commercial projects in Alberta linked to oil sands developments are highly likely to progress, and to also utilise CO2 from non-O&G high intensity emitting industries.
Within the GCC region a move to CO2-EOR rather than purely permanent sequestration in depleted formations is the most likely medium to long-term outcome, with CO2 volumes coming from the emerging grey hydrogen projects and the increasing development of sour gas fields in the region. Within Europe the imperative for point source capture for all industries, supported by EU-ETS, will create the necessary CO2 volumes, with sufficient storage capacity in offshore depleted reservoirs out to 2050.