Giving the greenlight to carbon capture, utilization and storage (CCUS) projects is complex but a necessity in the race to meet our climate goals. We did our research and created Getting to Final Investment Decisions, a 60-page report designed to help you understand a project’s journey, using Alberta’s success as a prime example.
Now, we’re breaking it down further into bite-sized blogs!
The second post in our series breaks down CO2 storage and transportation. These options are best investigated early when considering a capture project as they impact project timing and costs.
Part 2: Know your CO2 storage and transportation options
The carbon capture storage and utilization (CCUS) value chain includes three main components – capture, transportation, and utilization or storage. Sometimes a single entity manages the entire process, but more often, different companies handle one or two steps (e.g. one company does capture, another does transportation and storage).
Capture, storage and transportation are interdependent – progress in one can’t happen without the others. At early planning stages, capture projects need to understand storage and transportation options as each piece affects project economics and timing. Transportation and storage approval supports a capture project reaching a final investment decision and vice versa.
CO2 storage options
There are two main ways large-scale CCUS projects safely store CO2:
- Dedicated storage: This occurs at a geological storage site where CO2 is injected deep underground into porous rock formations where it is contained beneath dense layers of impermeable caprock, preventing CO2 from coming back up to the surface. These storage reservoirs are currently the most scalable option.
- CO2 Enhanced Oil Recovery (EOR): At these sites, commercial-scale volumes of CO2 are injected into mature or depleted oil reservoirs to help produce more oil. Once injected, the CO2 is then stored in the reservoir for its lifetime.
Other utilization methods, such as the use of captured CO2 in products such as plastics, fuels, concrete, etc. are currently unable to sequester commercial-scale volumes of CO2. These utilizations are likely to become important storage options in the future, but for now the main selection for large-scale CCUS projects is dedicated storage or EOR.
For a more information on CCUS, visit here.
CO2 storage selection
Identifying potential access to a viable storage solution is a critical first step in determining the feasibility of a carbon capture project. Here’s why:
- Permitting and regulatory timelines: Storage rights, permitting and various regulatory requirements vary across provinces and countries, often with long timelines. Understanding these processes is critical to assess a capture project’s feasibility.
- Location, location: Determining a location is a key step in evaluating a project’s economic viability. The farther capture projects are from storage sites, the higher transport costs are, impacting overall project costs. The distance between the capture facility and storage site can also impact the end-use selection for captured CO2 (dedicated storage vs EOR).
- Storage capacity: The capture scale will inform what storage or utilization opportunities are available to meet a project’s needs. A storage site’s injectivity, size and development timeline can have impacts on the construction of a capture facility.
- Incentives: The end-use selection of captured CO2 can affect eligibility for government incentive programs, which impact project costs. Refer to Economics of Dedicated Storage and Enhanced Oil Recovery to see how eligibility for federal and provincial incentives change based on end-use CO2, and how it impacts project economics.
- Shared transportation and storage: Regional hubs for transporting and storing CO2 from multiple sources can lower costs, share risks and enable scaling more quickly.
In Alberta, the government has legal ownership of pore space, which means a company needs permission to store CO2 underground. In 2021, the province started to develop strategically located carbon storage hubs in areas most favourable for CCS projects. Not just anyone can do this – the province has a competitive process for companies who want the responsibility of developing and operating these hubs. Alberta’s storage hub concept is driven by a desire to meet the growing demand for pore space in a manageable fashion. For more information on Alberta hubs, visit here.
CO2 transportation options
Once CO2 is captured from a facility, it needs to be safely and reliably transported for storage or utilization. Pipelines are the most common and cost-effective way to transport large quantities of CO2, while smaller quantities can be moved by truck and rail. Shipping, which is starting to take place at larger scales in Europe, is an option for transporting CO2 longer distances or to serve offshore carbon storage hubs. The key factors that influence transportation costs and methods are volume, distance of transport, and the number of capture entities connected to a network.
In Alberta, the 240 km Alberta Carbon Trunk Line (ACTL), operated by Wolf Carbon Solutions, is the world’s largest capacity CO2 pipeline. It transports CO2 captured from a refinery and fertilizer factory to be used for EOR by Enhance Energy at Clive.