The UK’s fossil fuel watchdog has unveiled plans for a licensing round to support carbon storage, as the oil and gas industry seeks to reduce its environmental footprint to reach net zero carbon emissions over the next three decades.
The North Sea Transition Authority (NSTA) has backed plans to expand the role of carbon storage across the industry, and will launch bidding auctions to support the capture of 20-30m tonnes of CO2 per year by 2030.
It revealed its plans to boost carbon storage in its latest corporate plan, published last week, setting its agenda for the next five years.
Carbon storage is the process of capturing produced CO2 before it enters the atmosphere, and usually storing it underground securely for centuries to mitigate the pollution caused by heavy-emitting industries such as fossil fuel exploration.
The announcement follows the NSTA granting two carbon storage licences to BP and Equinor in the Southern North Sea off the coast of Humberside earlier last week.
The licences are valid for eight years, during which the firms need to perform seismic surveys of four proposed storage sites and drilling wells to acquire data.
Including the latest awards, there are now six storage licences active in the UK, with the NSTA estimating the could come as soon as 2025.
When combined with existing licences nearby held by the Northern Endurance Partnership, which also includes Equinor and BP, the licences provided so far have the potential to provide storage for 23m tonnes per year of CO2.
Industry backing for carbon storage has yet to be met with significant financial support from the government – with only £5m of research into carbon capture included in the energy security strategy unveiled last month.
The meagre figure is part of a £375m package of support innovative energy technologies, however the bulk (£240m) is focused on hydrogen production.
Alongside pledges to bring in a licensing round for carbon storage, the NSTA’s has committed to “robustly regulate” emissions performance to make sure industry surpasses its commitment to cut emissions in half by 2030.
The regulator also argued it will maintain a “firm focus” on realising other targets agreed in last year’s North Sea Transition Deal, ensuring 50 per cent of investment in new domestic energy projects goes to UK suppliers.
The organisation’s budget for 2022/23 has been set at £38.9m.