Bjorn Otto Sverdrup: Oil and gas majors target transport emissions
The Oil and Gas Climate Initiative (OGCI) brings together 12 leading oil and gas operators to target net-zero emissions in their own operations. Now it has turned its sights downstream, with a lead role in the REMARCCABLE (Realizing Maritime Carbon Capture to demonstrate the Ability to Lower Emissions) Project. Bjorn Otto Sverdrup, chairman of OGCI’s executive committee, tells Leadership Insights why shipping emissions are a crucial piece of the puzzle.
Can you tell us about some of your initiatives underway to reduce emissions from the oil and gas sectors?
This year we see two major areas for collective action: eliminating methane emissions from oil and gas operations and using carbon capture technologies to enable large-scale emissions management for hard-to-abate sectors such as heavy industry, shipping and cement production.
To what extent do you believe that climate measures in the fossil fuel industry can contribute to the net-zero transition?
Global oil and gas operations account for a substantial portion of annual greenhouse gas emissions and the industry must decarbonise if the world is to reach net zero. That’s why OGCI members have set an ambition to reach net–zero operations.
In key areas of the energy transition, from methane emissions reduction and carbon capture, utilisation and storage (CCUS) to hydrogen and low-carbon fuels, OGCI’s members are demonstrating they have the will, the expertise, the scale and the scope to drive solutions forward.
How important is shipping to overall efforts to reduce greenhouse gas emissions from oil and gas production?
Shipping is particularly important because of the critical role the sector plays in the global economy. Our members have a direct connection with shipping through the oil and chemical tankers that they use to distribute products around the world. And the carbon intensity of these ships would need to be addressed for our member companies to achieve their own ambitions to reduce their Scope 1 and 2 emissions.
That’s why OGCI is facilitating the development of new technologies to decarbonise shipping with onboard carbon capture as part of the REMARCCABLE Project. We’re doing this alongside our work to support the development of low-carbon fuels, such as biofuels, ammonia and hydrogen, for shipping and other hard-to-abate transport sectors.
Why do you think carbon capture is a feasible solution for decarbonising shipping? What experience has OGCI or its members had with land-based CCUS?
CCUS has long been a priority for OGCI and our members. OGCI’s member companies already have significant experience applying carbon capture technology to stationary applications and the fundamental science doesn’t change when applying it to mobile sources like shipping.
Our member companies are currently involved in developing over 30 large-scale CCUS hubs around the world, providing an option for industries in the hub to capture and store their CO2 emissions. For example, OGCI member companies Equinor, Shell and Total are involved in the Northern Lights CCUS project, which is due to start operations next year.
These 30 projects have the potential to remove around 300 million tonnes of CO2 annually by 2030, equivalent to 80 coal power plants or taking 64 million cars off the road.
We have also worked extensively on CCUS. We have collaborated closely with partners to identify and qualify CO2 storage sites and possible clusters of industrial CO2 sources around the world while actively engaging with potential hub operators, industrial emitters, and policymakers to share the practical lessons learned in developing these first-of-a kind CCUS hubs.
While the unique conditions of the marine environment present some engineering challenges and the logistics of storing and offloading the CO2 will not be easy, these are not show-stoppers. Like stationary carbon capture, it is a matter of economics and this is where we are seeking to understand both the opportunities and challenges that lie ahead.
What can you tell us at this stage about the specific CCUS solution that will be deployed on the Stena Bulk vessel?
The team is currently working through the system design phase, but the project is targeting at least 30% absolute CO2 capture on an annual basis, or approximately 1,000 kilograms an hour of capture. It will use non-proprietary equipment and processes so that results can be shared broadly and publicly to maximise learning and encourage further technology development.
The project, led by a steering committee consisting of OGCI, GCMD and Stena Bulk, is proceeding well. In March, ABS gave its approval in principle to use a carbon capture system onboard an oil tanker. That was a critical step forward for the project, which could help accelerate commercial deployment of shipboard carbon capture technology within the next five years.
Do you see carbon capture as more feasible than using alternative fuels such as methanol, ammonia or synthetic/bio-LNG for decarbonising oil and gas shipping?
It is clear that we will need multiple technologies if we are to decarbonise the marine industry at the scale and speed necessary to meet both the IMO’s 2050 targets and the goals of the Paris Agreement.
Improved efficiency, propulsion aids, biofuels and alternative fuels such as ammonia and methanol all have critical roles to play alongside shipboard carbon capture. And a portfolio of competitively viable technologies needs to be available for the range of vessels, voyage profiles and unique circumstances.
Ultimately, it will be up to the individual shipowner to determine what works best for them.
OGCI is supporting the oil and gas sector in efforts to reduce methane emissions from oil and gas production – do you have plans to explore how to reduce methane emissions from gas shipping?
OGCI members recognise that eliminating methane emissions from the upstream oil and gas industry is one of the best short-term opportunities for contributing to climate change mitigation and for advancing the goals of the Paris Agreement, and it is a top priority for us.
Our members are working to eliminate methane emissions from their own operations and across the industry and we support the implementation of regulations to reduce methane emissions from existing and new sources.