Carbon Capture Reveals More Joint-Venture Prospects
10.14.2022 By Ella Keskin - NEWS

October 14, 2022 [Medium] – A new joint venture was announced by Japanese trading company, Mitsui Co., and American commodities producer CF Industries.

 

The terms of the JV are that Mitsui Co. will be responsible for selling blue ammonia to buyers throughout Asia. In other words, CF Industries produces the cleaner ammonia at large scale, and then Mitsui Co. sells it to Asia markets. One report says that Asia imports around 3 million tons of ammonia, but with this cleaner fuel those figures could go way up. As one of the most important Energy Transition fuels, blue ammonia is particularly important in Asia-Pacific markets due to widespread usage in manufacturing facilities and for ships throughout the region. announced at the Australian Petroleum Production and Exploration Association on 18 May 2022 that despite the constant criticisms of CCS that the technology is still critical for the Energy Transition, which means that Australia’s LNG industry should view CCS as a way to de-carbonize and reach Net Zero carbon emissions. Santos Ltd CEO Kevin Gallagher went a step further by encouraging South Korea to invest in Australia’s CCS capabilities. Australia has the world’s largest CCS project, operated by Chevron, at the Gorgon LNG project located in Western Australia, while South Korea is a major energy importer and one of the countries leading on the “energy security” efforts in Asia-Pacific amidst the Russia-Ukraine conflict.

In the United States the Biden Administration announced via the Department of Energy a $3.5 billion funding program for the Bipartisan Infrastructure Law that allocates funds for CCS technology development, including four Regional Direct Air Capture Hubs in the USA. It was reported that these funds will last from the years 2022–2026 with each hub capable of storing one million metric tons of carbon per year.

On 23 May 2022, France’s TotalEnergies signed an agreement with Sempra Infrastructure, Mitsui Co., and Mitsubishi Corporation to develop on the Hackberry Carbon Sequestration (HCS) project at the Cameron LNG facility located in Louisiana. According to the official agreement this project is expected to be North America’s first CCS facility that is designed to receive and store CO2 from multiple areas of production. Sempra’s CEO Justin Bird noted that a joint venture is a possible part of the deal, while the senior vice president of LNG at Total Energies said low-carbon LNG is key to Europe’s energy diversification strategy.

Singapore’s Eastern Pacific Shipping unveiled its two tankers — M/T Pacific Cobalt and M/T Pacific Gold — which are poised to receive the first carbon capture and filtering systems. This is very exciting news for the shipping industry and marine fuels decarbonization targets, according to the International Maritime Organization (IMO).

Perhaps this all seems a little too positive, so take a look at what happened in Canada this month where the Alberta government was criticized for the way it was controlling the underground space and awarding CCS projects.

Moreover, Saudi Aramco CEO Amin Nasser publicly announced at the World Economic Forum in Davos that under investments in hydrocarbons are a symptom of the “flawed transition strategy” that has been underpinned by Covid-19 supply chain effects and the Russia-Ukraine conflict.

Nevertheless, American offshore energy company Talos Energy announced on 25 May 2022 the company’s intentions to expand on CCS facilities in the US Gulf of Mexico by continuing to push for merger and acquisition (M&A) opportunities in USA, Brazil and West.

It was announced on 6 June 2022 that Shell has signed non-binding memorandum of understandings (MoUs) with two of its LNG buyers, Tokyo Gas and Osaka Gas, to explore more opportunities for LNG value chain decarbonization. On the same day, it was alsi announced on 6 June 2022 that the United Arab Emirates’ (UAE) Masdar signed two agreements with Azerbaijan’s Ministry of Energy for the purpose of developing projects in Azerbaijan for onshore wind, solar photovoltaic, offshore wind and green hydrogen. It was reported that this was the largest agreement made in Azerbaijan’s history, with the total production capacity amounting to 10,000 MW. For more information the World Bank Group published a document about the Offshore Wind Roadmap For Azerbaijan

Both ExxonMobil and Chevron announced plans to expand into the Carbon Capture and Storage (CCS) markets with new projects to live up to commitments they have made on getting to Net Zero. Thailand’s PTTEP also announced the country’s first CCS project.

In fact, Exxonmobil and Chevron serve as fantastic examples to explain how vital industry and government collaborations are for a successful energy transition. The two supermajors are both working with Indonesia’s PT Pertima to find adequate solutions for lower-carbon emissions production through carbon capture utilization and storage (CCUS) and promote energy security and independence in Indonesia. Exxon has even proposed building an ASEAN carbon capture network that will connect the entire region with low carbon energy solution to industrial production.

Concluding Thoughts

While many people are focusing on how industrial policies should be viewed in light of climate change, environmental protection and the overall detrimental aspects to humanity’s progress from the industrial uses of fossil-fuels, I argue that there is a much bigger picture within this narrative: it’s a paradigm shift about a changing worldview, one with massive implications for Environment, Social, Governance (ESG) and how to re-shape the ideals around the Global Economy, as well as exemplifying our knowledge-based information society, which should allow for greater understanding of the obstacles for Energy Transition and how it affects different parts of the world.

This writing sought to dive deeply into the latter, because I was focusing on the most pressing issues facing the future questions of industrial policies that are driving the Energy Transition, and how countries are adapting and formulating strategies to meet challenges in the global spectrum of events. Geopolitics are playing a much greater role in many countries’ industrial policies as a result of Russia’s and the United States’ politicization of crude oil, coal and natural gas — arguably the three most important commodities to the world now after the Covid-19 pandemic disrupted energy supplies around the world.

 

 


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