Page 5 - NorthAmOil Week 22 2022

NorthAmOil COMMENTARY NorthAmOil

Cameron LNG is
among the LNG export
terminals on the Gulf
Coast where CCS is
being advanced.

and Carbonvert with 25% interests each. What next?
Indeed, this also represents part of a bigger According to the Global CCS Institute, there
foray into CCS for Chevron. The super-major were 27 operational CCS facilities around the
also announced in mid-May that it was launch- world as of 2021 and a further 106 under devel-
ing a CCS development in California aimed at opment or already in construction. With the
reducing the carbon intensity of its operations industry still at such an early stage it still needs
in the San Joaquin Valley. to be demonstrated that carbon capture will be
However, it emerged at the same time that effective at helping the oil industry – and the
Chevron and Schlumberger had withdrawn world more broadly – to decarbonise.
an application for a carbon capture permit for Indeed, critics have pointed to underper-
a separate project in central California. The formance and operational issues at CCS facil-
withdrawal stemmed from a request from the ities such as the one intended for capturing
US Environmental Protection Agency (EPA), emissions from Chevron’s Gorgon LNG project The US is by far
which had said the application was “substan- in Australia as evidence that CCS should not be
tially incomplete” and had failed to provide relied upon to perform to its full potential. But the leader in
financial assurances for that project. industry sources contend that as more compa- both existing and
Chevron and Schlumberger said they had nies participate in CCS development, this will
opted to withdraw the permit application but help to both improve the technology and its per- proposed CCS
would continue “to gather and evaluate pro- formance and bring down costs.
ject information”. However, given the timing of Either way, CCS projects will find them- projects globally.
Chevron’s announcement about the San Joaquin selves under the spotlight as more come
Valley CCS project, it appears likely that the online while national decarbonisation targets
super-major is turning its attention to similar for 2030 and beyond loom. The industry will
developments elsewhere. be under pressure to demonstrate that CCS
Also at around the same time in mid-May, BP is effective.
and Linde announced that they were partnering There is still a long way to go until this point,
on a “major” CCS project in Texas. That project and given the speed with which new CCS ven-
is part of a blue hydrogen venture entailing pro- tures are being announced, there will be sig-
duction of hydrogen from natural gas, while nificantly more carbon capture capacity under
emissions are captured and sequestered. The development in the not-too-distant future com-
partners said the project would also support the pared with today. While competition could well
storage of carbon dioxide (CO2) captured from emerge in other regions, it appears that the US is
other facilities in the Texas Gulf Coast industrial likely to continue leading the way, with the high-
corridor. est number of projects being planned.™

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