CCS to Drive Infrastructure Investment

(Global) Contract Awards to Grow ‘Significantly’

Huge investment in carbon capture and sequestration, or CCS, infrastructure could spur significant new breakbulk activity over the next decade and a half, according to research consultancy Rystad Energy.

The firm predicts that Europe could see US$35 billion of spending on CCS in the period up to 2035, with a raft of new facilities constructed to capture as much as 75 million tonnes of CO2.

“In Europe alone there are around 10 larger projects, with both carbon capture and storage, that are planned and have a high chance of being operational by 2035 ... Although most of the projects are expected to be on-line from the middle of this decade, investments and contracts awarded to suppliers will already start to grow significantly from 2021–2023,” said Audun Martinsen, head of energy service research at Rystad.

Transport Opportunity

Within the complex development of these massive CCS projects, about 35 percent of costs are expected to relate to transport and operations necessary to create trunk lines, ship breakbulk components and build infrastructure.

“Developing CCS projects is also an opportunity for the linepipe and oil-country tubular goods industry, with a new market about to open up for suppliers looking to expand beyond oil and gas,“ said James Ley, senior vice president at Rystad.

About 15 percent of costs are predicted to arise from storage investments, primarily from well-related services to store the CO2 safely in underground reservoirs. Rystad forecasts that about US$30 billion of total capital investment will go towards construction costs with an additional US$5 billion for operational expenditure until 2035.

North Sea Focus

The firm predicts that the North Sea will emerge as a focus for early development with sites in Norway, the UK, Denmark and Netherlands propelling development.

“About half of the capex will be consumed by the facilities at the source, with CO2-capture equipment and facility construction making up the largest part,” Rystad said.

Headquartered in Oslo, Norway, Rystad Energy is an independent energy research and business intelligence company focused on energy fundamentals in the global and regional upstream, oilfield services and renewable energy industries.
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