The carbon capture question | FT Climate Capital

Summary

In the UAE, oil and gas companies, including ADNOC, are exploring carbon capture and storage (CCS) technologies as a way to mitigate climate change. While promising, CCS faces skepticism due to high costs, scalability challenges, and concerns about its use to justify continued fossil fuel extraction. Although CCS could play a role in hard-to-decarbonize industries like cement and steel, experts stress that renewables like wind and solar are the more effective solutions. The global oil and gas industry’s reluctance to invest in clean energy technologies has slowed the adoption of CCS, which remains a costly and experimental approach.

Takeaways

• 😀 The UAE, one of the world's top oil producers, is pioneering carbon capture and storage (CCS) technology to mitigate climate change impacts.
• 🌍 Some oil and gas companies, like ADNOC, are experimenting with carbon capture to reduce emissions, but critics question whether they should continue fossil fuel production.
• 🔋 Renewable energy, like wind and solar, is seen as the main solution to global warming, while carbon capture is viewed as a supplementary tool for hard-to-decarbonize industries.
• 💡 ADNOC is testing a unique project where carbon dioxide dissolved in seawater is injected into rocks, turning it into minerals—a novel approach in the UAE.
• 🌱 Carbon capture projects like ADNOC's are still in experimental stages and may not achieve large-scale emissions reductions by 2030, raising concerns about feasibility.
• 🛢️ Despite the advancements, there is concern that carbon capture technologies may be used to justify continued oil and gas extraction rather than reducing fossil fuel use.
• ⚠️ Experts argue that carbon capture should focus on hard-to-decarbonize sectors like cement and steel, not on extending fossil fuel production.
• 💰 The cost of developing large-scale carbon capture solutions remains high, with current prices exceeding $600 per ton of CO2, but projections suggest it could fall below $200 per ton.
• 🔬 Carbon capture technologies have existed for decades, but their commercialization has been hindered by the lack of a global carbon pricing system and insufficient investment.
• 🌍 To meet global climate targets, experts estimate that annual investments in carbon capture and storage would need to increase drastically, from $4 billion today to over $3.5 trillion.

Q & A

What is the main focus of the carbon capture and storage (CCS) project in Abu Dhabi?

The main focus of the CCS project in Abu Dhabi, led by ADNOC, is to capture and store carbon dioxide (CO2) emissions by mixing it with seawater and injecting it into rock formations. This process aims to reduce the amount of CO2 in the atmosphere and help address global warming.

How does the Abu Dhabi National Oil Company (ADNOC) plan to handle the CO2 after it is captured?

ADNOC plans to work with a startup called 44.01 to inject CO2, dissolved in seawater, into rocks near the surface. This process, still in its early stages, aims to turn the CO2 into mineral forms and store it safely underground.

What are the challenges associated with carbon capture and storage (CCS) as discussed in the transcript?

Challenges include the high cost of developing CCS systems, the scalability of the technology, and the safety of storing CO2 underground. Additionally, there are concerns about relying too heavily on CCS as a solution while fossil fuel consumption continues.

Why do climate experts caution against using CCS to justify continued fossil fuel production?

Climate experts argue that CCS should not be used as an excuse to keep producing fossil fuels. They stress the importance of reducing emissions directly by transitioning to renewable energy sources like wind and solar, which are cheaper, cleaner, and more sustainable.

What is the target for carbon capture capacity in Abu Dhabi by 2030?

The target for carbon capture in Abu Dhabi is to capture 10 million tonnes of CO2 per year by 2030, a significant increase from the current 800,000 tonnes annually.

How does the cost of carbon capture technology compare to the potential benefits, according to the transcript?

The cost of developing carbon capture technology remains high, and current estimates for direct air capture are around $600 per tonne of CO2. However, experts believe that with enough investment and technological advancements, the cost could drop below $200 per tonne, making it more viable in the future.

What role does carbon capture play in industries like cement and steel manufacturing?

Carbon capture and storage is seen as a potential solution for hard-to-decarbonize industries like cement and steel manufacturing, which are essential for the global economy but difficult to transition to renewable energy. CCS can help capture and store the emissions produced by these industries.

What are the environmental and ethical concerns surrounding the involvement of oil companies in CCS projects?

The main concern is that oil companies, which are responsible for a significant portion of global emissions, may use CCS to justify ongoing fossil fuel production. Critics argue that this could delay the transition to cleaner energy sources and may not be an effective long-term solution for climate change.

What is the overall stance on the future of CCS technology and its role in achieving climate goals?

While CCS has potential, it is not seen as a standalone solution to the climate crisis. Experts agree that it must be part of a broader strategy that includes reducing fossil fuel consumption, transitioning to renewable energy, and investing in new technologies for decarbonization.

Why is it difficult to scale CCS technology to meet global climate targets, according to the transcript?

Scaling CCS technology is difficult due to its high development costs, the complexity of capturing CO2 at an industrial scale, and the challenges of safely storing the captured CO2. Furthermore, significant investments are needed to develop the necessary infrastructure and reduce costs over time.