Norway Kick-Starts $2.98B Carbon Capture and Storage Project
By 2025, if all goes according to plan, Norway will have become a key global player in the shift towards Carbon Capture and Storage (CCS) technology. This will be in line with its commitment to cut domestic emissions by 50 to 55% by 2030. In March, a major milestone was reached towards this objective with the Government’s approval of a development plan for the $1.52 billion ‘Northern Lights’ project. ‘Northern Lights’ is the carbon dioxide (CO2) transport and storage hub that will form part of the more comprehensive $2.98 billion ‘Longship’ carbon capture and storage project. Tina Bru, Minister of Petroleum and Energy, describes Longship as “the greatest climate project in Norwegian industry ever."
Northern Lights will be built and operated by the Northern Lights JV DA Company. It will be backed by the Equinor, Shell, and Total energy consortium, subject to a government approved participation agreement between the three companies. Kim Bye Bruun, Communications & Government Relations Director Northern Lights, told The Earth & I “The Ministry of Petroleum and Energy is expected to approve the Northern Lights JV as a license holder on the Norwegian Continental shelf later this month [April]. Exploitation license EL001 will be then transferred from Equinor to the Northern Lights JV as operator.”
In addition to Northern Lights, Longship will consist of two CO2 capture facilities: a facility at Norcem’s Brevik cement plant; and a facility at Fortum’s planned waste-to-energy plant in Oslo. The captured CO2 will be transported by ship to the Øygarden municipality on the western coast of Norway. Here, Northern Lights will temporarily store the gas before sending it through a pipeline to a sealed reservoir for permanent storage 2,600 meters below the seabed. The first phase of the project, which is predicted to have a capacity of up to 1.5 million metric tons per year of carbon dioxide, is expected to be completed in 2024.
The CO2 capture facility that is planned will be at the Oslo Varme waste-to-energy plant that is 50% owned by the Finnish state-owned energy company, Fortum, and 50% by the Oslo Municipality. The plant’s integrated CCS technology is expected to capture approximately ninety percent of the CO2 that is emitted. Fortum hopes that the project will become fully operational in 2026, subject to funding. The company is now pushing for the necessary capital from the EU’s innovation fund. Jannicke Gerner Bjerkås, Director for CCS at Fortum Oslo Varme, told ‘Gas World’ “We have applied for the first call of the Innovation Fund...we will know if we have advanced to phase two, and by the end of the year if we have been successful or not, but there is a lot of competition.” No less than 311 projects have applied for the Innovation Fund and only seventy will advance to Phase Two. According to EURACTIV, the amount applied for by Fortum is approximately $357 million. The sum covers the investment cost as well as ten years of operation. At the end of March, it was announced that the project had made the shortlist for EU Innovation Funding.
Bjerkås estimates that approximately 450 waste-to-energy plants could benefit from the technology used in the Oslo-based Fortum plant. The company already has high hopes for Scandinavia, Norway, Sweden, and Finland. Once the mass roll out of the technology occurs, the price of the technology can be expected to drop, making the solution more appealing to potential customers. Bjerkås puts the cost of maturing the project, all the way through feasibility, concept, and Front End Engineering Design End (FEED), including the building and operation of a pilot plant, at approximately $26 million. A key driver underpinning the decision to invest in CCS technology is the introduction by the Norwegian government of a carbon tax, as of January this year. The tax level for the waste-to-energy sector is approximately $17.6 per metric ton of CO2. However, it is going to rise in the years to come. Given that the Oslo Varme waste-to-energy plant emits 400,000 metric tons (440,000 tons) of CO2 per year, a carbon capture facility could represent sizeable cost savings.
CCS has been a controversial technology for many years. The prohibitively high cost and links to coal plants have been some factors limiting implementation.
Meanwhile, at the end of last year the Norwegian Parliament voted in favor of the government’s proposed grant funding for an industrial scale implementation of CCS at the Heidelberg Cement subsidiary Norcem’s Brevik cement plant. The project, when it comes online, will be the world's first CO2 capture facility at a cement factory. Norcem has a vision of zero emissions from concrete by 2030. An essential element is to make use of the residual heat from the cement factory. The company claims that there is enough residual heat to capture approximately 400,000 metric tons (440,000 tons) of CO2 per year, equivalent to 50% of the plant's emissions. Work is expected to start with CO2 separation from the cement production process by 2024.
The use of CCS technology, as a means to both reduce emissions in key sectors directly and to remove CO2 to balance emissions, has been debated for many years. Indeed, for decades, Norway has been in the vanguard of CCS technology with CO2 storage projects on the Sleipner and Snøhvit fields. However, the cost of some of the earlier proposed projects was prohibitively expensive. The UK based Carbon Capture & Storage Association (CCSA) estimated the cost per metric ton of abating carbon dioxide emissions in the power sector as high as $103 for the early projects. And there was also considerable skepticism in Europe, linked to previous project failures. In 2009, the European Commission put $1.2 billion on the table to finance six CCS demonstration projects. However, these never saw the light of day. A number of these projects were linked to coal plants, which have since been out-competed by renewables.
Skepticism among green activists about the efficacy and intentions behind CCS has not entirely gone away. Indeed, it remains a potent political force in Europe, particularly Germany. Janek Vahk, a campaigner at Zero Waste Europe questions the industry’s focus on capturing emissions, rather than reducing waste. “Their focus on negative emissions is wrong—focus should be on capturing those organics still found in the residuals,” he told EURACTIV. Another problem expressed by campaigners is that incineration undermines other attempts to reduce waste and recycle.
The International Energy Agency described CCS as “the only group of technologies” capable of achieving a net-zero energy system.
Yet despite these concerns there are clear signs that CCS is a technology whose time has finally come. A landmark International Energy Agency (IEA) report released at the end of 2020, described CCS as “the only group of technologies” capable of achieving a ‘net-zero’ energy system. In the last three years, plans for more than thirty commercial facilities have been announced worldwide. However, the IEA suggests that these could just be the beginning. Projects now nearing a final investment decision (FID) represent an estimated potential investment of around $27 billion, “more than double the investment planned in 2017,” the report said.
Raymond Johansen, the governing mayor of Oslo, also believes that the conversation about CCS has matured since the early days when the technology was put forward by the coal industry as a way of mopping up its emissions. CCS projects are no longer related to energy emissions but to heavy industries like cement which have no other alternatives readily available. “Countries are much more positive today about CCS than they were ten years ago. As urbanization continues in Europe and around the world, we believe there will be an increasing need for CCS to be installed on incineration plants. In Europe alone, there are around 500 similar plants which could use the same technology,” Johansen told EURACTIV.
*Nnamdi Anyadike has worked as a metals, oil, gas, and renewable energy industry journalist for more than thirty-five years.