Carbon capture and storage (CCS) is a vital component in reducing CO2 emissions for industries, including steel, chemicals and power generation, which struggle to decarbonize effectively and sufficiently. CCS technology can transport the CO2 captured to be reused or store safely and permanently deep in the ground.

In an interview with Maritime Fairtrade, Bernardene Smith, Principal Policy, Regulation and Commercial, Global CCS Institute, delved in-depth why the fundamentality of CCS and cooperation among countries is key to move the shipping industry in the desired direction. 

According to Global CCS Institute, at the end of March, there were 43 CCS projects operating globally, with a total capture capacity of around 50 million tons per annum of CO2. Thirty-three more facilities are under construction.

Bernardene Smith, Principal Policy, Regulation and Commercial, Global CCS Institute. Photo credit: Global CCS Institute

Transboundary transport of CO2 for geological storage is emerging as a significant opportunity. What is driving this demand? 

Greater interest in transboundary CCS projects is being driven by the emergence of new markets and applications for CCS technologies, as well as enhanced or revised national commitments to achieving net-zero, and wider commercial opportunities afforded by the deployment of CCS networks. 

In addition, CCS will play a significant role in decarbonization in Asian nations who are, and will continue to be, reliant on energy generated from fossil fuels up to 2050, due to their growing populations, and slower transition to renewable energy. 

These factors are driving agreements or arrangements such as the recently signed LOI between Singapore and Indonesia, to collaborate on cross-border CCS initiatives. In 2023, Singapore announced a commitment to establish capture capacity in the country of at least two million tons of CO2. However, without potential storage resources for the captured CO2, Singapore will have to collaborate with countries in the region in this regard. 

In 2023, Japan’s Ministry of Economy, Trade and Industry also announced support for seven CCS value chains, and added two more this year, capturing CO2 in Japan, and storing it in Japanese waters, and outside Japan’s borders. Bilateral agreements or arrangements, required under the London Protocol, must be established between Japan and the importing governments to enable the cross-border transport of CO2 for storage in the importing country’s borders.

How will this elevate the maritime industry in terms of commerciality and sustainability? 

Transport of CO2 by ship to offshore storage facilities is a new commercial opportunity for the maritime industry, and a much-needed complementary mode of transportation to the conventional pipeline mode. 

Much activity is already underway to develop specialized CO2 carriers, for example Mitsui O.S.K Lines and Chevron are investigating the feasibility of transporting CO2 from Singapore to Australia. In addition, Capital Gas Ship Management, Hyundai Mipo Dockyard, and Lloyd’s Register have signed an agreement, aiming to collaborate on the construction of two 22,000m3 low-pressure liquefied CO2 (LCO2) carriers, to be delivered in 2025 and 2026 respectively.

The first shipment of LCO2 was transported from Belgium to the Danish North Sea in 2023, as part of the pilot phase of Project Greensand. Cross-border shipping of CO2 is also planned for other projects, including the Northern Lights Project, and the NoordKaap project, which will ship CO2 from emitters in Germany, Scandinavia, Belgium and northern France, to storage facilities in the Norwegian North Sea.

Apart from supporting decarbonization efforts through transporting CO2 to offshore storage locations, the maritime industry is also aiming to develop more environmentally sustainable ships. 

For example, Daewoo Shipbuilding and Marine Engineering (renamed Hanwha Ocean), in conjunction with Hi Air Korea, have developed the Onboard Carbon Capture System (OCCS), which is expected to be incorporated into four newbuild LNG carriers scheduled for delivery in 2024 and 2025.

Alongside the global CCS trend, acceleration in policy, legal and regulatory developments move in parallel. What is the delicate mix which needs to be balanced in order to support growth in a safe and sustainable manner?

Supporting industry growth in a safe and sustainable manner requires a balanced approach that ensures safety across the CCS value chain, while incentivizing business, and addressing societal impacts.

Jurisdictions around the world have established and implemented robust regulatory frameworks for environmentally safe and effective storage of CO2. Additionally, the Intergovernmental Panel on Climate Change has also provided high-level inventory guidelines for geologic storage, and the International Standards Organization has developed industry standards.

In addition, incentivizing business by strengthening the business case for CCS will be critical for accelerating deployment to meet global climate goals. More progress is needed on a combination of governmental climate policies and carbon markets to enable a scalable business case.

It is also critical to understand and address any societal impacts of CCS projects at local, regional, and global levels. Engaging with affected stakeholders, including communities to provide information and address concerns, should be an integral component of all projects.

The first quarter of 2024 saw a steady increase in international and regional collaboration. What are the main concerns and opportunities for the maritime industry?

The concerns would include: 

• Bilateral agreements or arrangements required under the London Protocol, for the transportation of CO2 for offshore storage, may not be in place by the time emitters are ready to capture their CO2 and the maritime industry is ready to transport it cross-border to offshore storage locations.

• Offshore storage facilities may not be ready to receive captured CO2, due to the lack of CCS regulations in the specific country, or delays in the permitting of the facility operations.

• Regulatory complications may occur when CO2 is transported across multiple borders, and CCS regulations are not consistent between countries.

For opportunities:

• Commercial opportunities for ship building companies in Japan, Republic of Korea and other countries that are currently building LNG and LPG tankers, to develop and construct specialized LCO2 carriers for global transportation of CO2. 

• At present, LCO2 is shipped under medium pressure due to the small volumes of CO2 transported. Research and development of new technology, including high-, and low-pressure transport solutions, will create the potential to transport large volumes of CO2 by ship.

• The maritime industry could participate in regional bodies, such as the Asia CCUS Network, to ensure issues relating to maritime transport of CO2 between countries in the region are considered and adequately addressed. The Asia CCUS Network, established in 2021, aims to facilitate collaboration on the deployment of CCUS in Asia.

Why does the Global CCS Institute supports the Important Projects of Common European Interest to further drive CCS in Europe?

To limit global warming to below 1.5˚C and avoid the worst impacts of climate change, we must prioritize curtailing global greenhouse gas emissions and reaching net zero by mid-century. CCS is essential, alongside other carbon management technologies to meet this challenge.

To date, global collaboration has played an important role in demonstrating and deploying CCS and other carbon management technologies, but more ambitious international calls for action, backed by stronger policy to incentivize investment in CCS will be important to maintain the momentum.

Photo credit: iStock/ Sakorn Sukkasemsakorn