Page 25 - Gi flipbook June/July 2018

CCS AND
HYDROGEN
The Climate
Change Act of
2008 established
a framework to
CONFIDENCE AND CONTROL: THE OUTLOOK
FOR THE OIL AND GAS INDUSTRY IN  CONFIDENCE
develop an AND CONTROL
The outlook for the oil and gas industry in 2018
economically SAFER, SMARTER, GREENER
credible
emissions reduction path. It includes
the 2050 target committing the UK to
reduce emissions by at least 80 per
cent by 2050 from 1990 levels.
The feasibility of introducing
hydrogen into the downstream gas
networks to reduce emissions is
actively being researched by the
downstream gas industry. For
example, Northern Gas Networks has
launched an initiative to convert the
gas grid in Leeds from natural gas to
zero-carbon hydrogen. The project
aims to demonstrate the potential
that hydrogen has to help the UK
meet 2050 climate change
obligations, while making use of
existing gas network infrastructure.
HYREADY, a DNV GL-managed joint
industry project (JIP), aims to develop
technical guidelines for injecting
CO2 Technology Centre Mongstad, Norway hydrogen into gas transmission and
distribution networks in order to
DNV GL has more than 25 years’ tonne in Europe by 2050. ensure that such injection takes place
experience advising customers on According to Shell, the cost of safely and at acceptable cost. Several
CCUS projects, acting as an carbon capture relative to the cost of theoretical studies based on 20 to 100
independent and trusted partner for emitting CO2 is the critical drag on per cent hydrogen content in the
assessing and communicating risks deployment. Without higher carbon network are underway, and a research
throughout the value chain. The prices or government financing, project is commencing this year at
company captures knowledge into its large-scale CCS is unlikely in the near DNV GL’s Spadeadam Test and
recommended practices and future. Bennett agrees: “While we Research Centre. It is anticipated that
standards, and advises on creating and have now demonstrated through pilot hydrogen containing networks could
implementing international standards projects that CCS can be achieved be in full scale operation before 2030.
such as ISO for CCS. both technically and commercially, Consensus opinion is that steam
“Carbon pricing is probably the most rollout at scale is still impacted by a reforming of methane will be the most
efficient measure to mitigate the risks lack of clear and consistent economical source of bulk hydrogen in
associated with global warming government policy and a realistic cost the near future, but this technology
emissions,” said Graham Bennett, DNV of carbon. The carbon price in current also generates carbon dioxide as a
GL Vice President, Business markets is still below the biproduct. Operating with just a 20 per
Development UK and West Africa. “It recommendations published in 2017 cent hydrogen blend in gas networks
is a simple and comprehensive way to of USD40-USD80 per tonne of CO2 will generate huge quantities of carbon
bring the much-needed changes in by 2020 and the USD50-USD100 per dioxide, so there is a clear need for a
behaviour to facilitate average tonne of CO2 by 2030.” large storage capacity for CO2 if
temperatures reaching less than 2°C.” The energy transition is seen by emissions targets are to be achieved.
The company produced its inaugural many as a gradual process, but The North Sea’s depleted oil and gas
Energy Transition Outlook in 2017. according to DNV GL’s 2018 Industry fields could be the main CCS solution
Assuming a gradual or limited uptake Outlook report, 44 per cent of the downstream gas industry is
of CCS, the report forecasts that the respondents say their organisation is looking for. Therefore, hydrogen and
cost of CCS per tonne of CO2 will actively preparing for a transition to a CCS are inextricably linked for a
decrease across the next three less carbon-intensive energy mix. It carbon free future. ■
decades from USD115 in 2020 to found that the vast majority (86 per
USD74 by 2050. At the same time, cent) expect gas to become an ■ Download DNV GL’s eighth annual
the model predicts that average increasingly important part of the report, Confidence and Control: the
carbon prices will increase across all global energy mix over the next decade outlook for the oil and gas industry
regions, but only to a top of USD60/ – up from 77 per cent a year ago. in 2018, at www.dnvgl.com/

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