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As the world accelerates towards a sustainable recovery, what role will carbon capture and storage (CCS) technologies have in transforming industrial operations?

On June 24, 2021, Shell Catalysts & Technologies will host a discussion on “Accelerating a Sustainable Recovery: Carbon Capture and Storage”. The panellists include Andy Gosse, President, Shell Catalysts & Technologies and Syrie Crouch, VP Carbon Capture Storage at Shell. The moderator is Nick Flinn, VP Technology Licensing and Services, Shell Catalysts & Technologies.

In this Q&A, Andy Gosse and Syrie Crouch share their initial thoughts on how governments’ economic recovery plans are helping societies’ shift towards a greener economy as well as economic insights into the present and future scale-up of CCS technologies.

Learn more about How carbon capture and storage can help increase competitiveness through the energy transition

1. Do governments have a pivotal role in the acceleration of CCS project deployment? Or is it possible for independent companies to afford CCS solutions independently?

Syrie Crouch: There are countries utilising different strategies involving incentives and price premiums. It’s giving us different value levers that we can pull into our value chain to say, “Can we create a CCS project which utilises either a tax break or a lower-carbon fuel standard element, or in the case in Europe, the subsidy market?” Subsidies are great to get the first projects off the ground, but the government is not going to continue to subsidise them. At some point, we also must work to get market forces at play here.

One of the things we’re working on at the moment is: How do you get value out of lower carbon products? I think this ties into the market you’re selling to and if your customer has a net-zero emissions ambition. Effectively, they will have a carbon budget that they have to manage and they will be looking for lower-carbon products preferentially.

Andy Gosse: The other key driver is, of course, the shareholders of large companies. Shell, and many companies, have been making very significant, ambitious statements around what they aspire to do.

This is for a variety of different reasons, including the desires of the shareholders, who are clear that they expect to be investing money in companies that are prepared to go on the decarbonisation pathway. That incentivises and creates a different dynamic around the necessity to look up many different options for decarbonisation, including carbon capture and storage.

Syrie Crouch: Yes, and it’s equally about the products that we enable, so low-carbon steel, low-carbon cement, blue hydrogen, low-carbon fuels, low-carbon biofuels. We are looking at the potential for negative emissions in biofuel production, which means the negative emissions can be used to offset other emissions that we can’t get rid of any other way.

2. How can industrial clusters in hard-to-abate sectors improve CCS project economics and viability?

Syrie Crouch: The first thing I’m going to talk about is changing the mindset we have when we talk about CCS industrial clusters. The one-dimensional thinking around CO₂ is we have an asset, that asset has a CO₂ emission and there’s a CO₂ tax or tariff. And for that cost, can we afford to capture the CO₂ and store it?

Now let’s consider a three-dimensional view, which means you’re not looking just at the emission source, but the value chain of the products which are coming out of that asset. So, can I now sell a lower carbon plastic, fuel or steel? Can I make use of the price premium that people are potentially willing to pay in this space?

Then we can also consider economies of scale to utilise the same store, the same pipeline, to decarbonise multiple different assets.

Andy Gosse: We can also consider the integration of different waste streams from the different companies in that cluster. As we’ve looked at some of the industrial clusters in Europe, there is potential for one industry’s waste to become a value stream for that hub in terms of allowing that hub to make different products. One of the waste-to-value streams being explored at the moment is for the creation of synthetic fuels, where you take waste streams from the steel industry and combine those with hydrogen.

These ideas are starting to come into fruition and we are seeing how a cluster is more than just the sum of one of those individual companies. That system can create a wider opportunity for the hub to create value and reduce cost.

There are a number of CCS projects we have deployed, but we’re at the infancy of our journey in learning. Every time we deploy a technology, we will learn from the feedback we get from its performance. It will give us new ideas for engineering and new ideas for integration of the systems that will reduce costs significantly over time and improve the economics.

3. What learnings from Shell’s Quest CCS facility have helped to make the technology more scalable?

Syrie Crouch: has been in operations since 2015 and has stored over 5 million tonnes per annum. There are a few key learnings we have made in terms of the storage of carbon:

We had planned the project with good uptime and it has outperformed our expectations. Quest is at about 99.7% uptime. That is huge for the project, keeping in mind that Quest is a Shell asset. The more we provide a CO₂ solution for others in a service provision, the more that uptime is critical for customers to realise that their whole manufacturing process can continue to be sable.

When we designed Quest, it was the first of its kind. One could argue that it was over engineered. Our learnings included what we don’t necessarily need in future, including the number of wells and monitoring elements on the subsurface side that we worked with the government of Alberta to scale back. If we rebuilt it today, we think there are significant learnings from how we constructed it that could lead to a 20–25% cost reduction.

Andy Gosse: On the capture side, we’ve looked at Quest’s performance and design for opportunities for heat integration and plant operational efficiency for cost savings. There are new emerging technologies that will allow us to potentially reduce the costs further, such as solid adsorbent technology.

Existing technologies, using techniques such as modularisation, can also lead to significant levels of saving. Rather than a bespoke, heavily engineered solution tailored to an individual customer circumstance, we can potentially make simpler units in modules that can be standardised. This can allow smaller customers and smaller emitters to potentially bring the economics of CCS into a favourable position.

4. What is the role that you see CCS playing in the energy transition?

Syrie Crouch: Depending on how fast we move towards hydrogen, wind, solar etc., we will need something between 3 to 12 gigatonnes per annum of CCS to cover those hard-to-abate sectors. This is according to estimates in the Shell Sky Scenario (PDF)

What is a gigatonne? To give you some indications, if you put the entire population of the world on a set of scales, we weigh about half a gigatonne.³ If you look at our global annual consumption of plastic, that’s¹ gigatonne per annum⁴. The current oil and gas infrastructure is about 5 gigatonnes per annum.⁵

So what the estimates for future CCS are saying is that we need something roughly the size of the current oil and gas industry, but operating in reverse to capture the CO₂ molecules and store them underground.

Now, not all of the solutions have to be CCS. Some of it can be through nature-based solutions or utilisation. But if you put that into the context of where we are today, we are currently storing about 14 million tonnes per annum.⁶ That’s million tonnes versus gigatonnes. If we take the most optimistic scenario, by 2050, we have to be storing 3 gigatonnes per annum.⁷ That is a huge ramp up and it requires about 2,000 world-class CCS projects.⁸ So the reality is, there's a lot to be done.

The other key takeaway though, is that Shell CCS is known technology. It’s bringing together elements that have been utilised by the oil and gas industry for decades. The industry has been capturing CO₂ since about the 1930s. The industry has been transporting CO2 via pipelines and utilising it for enhanced oil recovery (EOR) and storing it since the 1970s.

Even though we are not talking about EOR, all those geological principles of how you store the oil and gas also apply to how you store CO₂. So it’s known technologies; we are just stringing them together in a different fashion.

Our challenge, as we just discussed, is how do we reduce the cost? How do we make it more cost-effective as we do more of these projects? We are creating solutions through our learnings and scale-up of CCS, as even in the last 18 months CCS has kicked into a whole new gear.

¹ _{"The Role of CO2 Storage”, International Energy Agency, July 2019, https://www.iea.org/reports/the-role-of-co2-storage.}
²_{" Summary for Policymakers in Global Warming of 1.5°C”, Intergovernmental Panel on Climate Change, 2018, https://www.ipcc.ch/site/assets/uploads/sites/2/2019/05/SR15_SPM_version_report_LR.pdf.}
³ _{Rachael Rettner, “The Weight of the World: Researchers Weight Human Population”, Live Science, accessed 27 May 2021, https://www.livescience.com/36470-human-population-weight.html#:~:text=Humanity%20could%20stand%20to%20lose,242%20million%20normal%2Dweight%20people.}
⁴ _{"Plastic and Climate: The Hidden Costs of a Plastic Planet”, Center for International Environmental Law, accessed 27 May 2021, https://www.ciel.org/project-update/plastic-climate-the-hidden-costs-of-a-plastic-planet/.}
⁵ _{Jeff McMahon, “Carbon Capture Has To Get As Big As Oil Industry In Less Than 30 Years”, Forbes, 4 April 2021, https://www.forbes.com/sites/jeffmcmahon/2021/04/04/carbon-capture-has-to-get-as-big-as-oil-industry-in-less-than-30-years/?sh=69ea5f9327b1.}
⁶ _{"Global Status of CCS 2020”, Global CCS Institute, 2020, https://www.globalccsinstitute.com/wp-content/uploads/2021/03/Global-Status-of-CCS-Report-English.pdf.}
⁷ _Ibid.
⁸ _{"Carbon capture and storage: Challenges, enablers and opportunities for deployment”, Global CCS Institute, 30 July 2020, https://www.globalccsinstitute.com/news-media/insights/carbon-capture-and-storage-challenges-enablers-and-opportunities-for-deployment/.}