Carbon Capture, Utilization and Storage – A New Trend Toward Decarbonization

Carbon Capture, Utilization and Storage – A New Trend Toward Decarbonization

  • Carbon capture, utilization and storage (CCUS) technology has been around for decades, but it is seeing new growth as governments and businesses focus on reducing their carbon emissions.
  • The oil and gas industry has the skills and infrastructure to take advantage of opportunities to implement CCUS projects.
  • Despite environmental risks, high costs and the lack of an adequate regulatory framework, CCUS is poised to become a key technology on the road to a carbon-neutral economy.
November 09, 2021 | Oil and Gas Blogs

With major countries struggling to control their carbon dioxide (CO₂) emissions and fulfill commitments to reduce their production of greenhouse gases, carbon capture, utilization and storage (CCUS) has been the subject of much discussion.

National lockdowns to combat the COVID-19 pandemic and the subsequent global economic slowdown caused a 6.4% reduction in global carbon dioxide emissions in 2020. However, carbon emissions rebounded sharply as lockdowns ended, and governments face the difficult task of continuing to reduce emissions without negatively impacting economic growth. CCUS can play a key role in achieving this objective, as most countries believe that oil and gas will remain an indispensable part of the energy mix for the next few decades.  

CCUS and carbon capture and storage (CCS) both involve capturing the carbon dioxide from an existing industrial process (either pre- or post-combustion) and reusing it (in the case of CCUS) or permanently storing it in subterranean structures, such as depleted oil and gas fields or deep saline aquifer formations. It is estimated that carbon capture and storage (CCS) technology can trap up to 90% of the carbon dioxide emissions from fossil fuels used in electricity generation and industrial processes, preventing the CO₂ from entering the atmosphere and contributing to climate change.

Countries including the U.S., Australia, Japan and the 10 members of the Association of Southeast Asian Nations (ASEAN) are forming a partnership to commercialize CCUS technology and are looking at potential CCUS sites in Southeast Asia.

Though the technology has been evolving since the 1970s, only now has the industry been focusing on creating low-cost opportunities to capture CO₂ amid sufficient market demand. The oil and gas industry has the primary advantage in that it has the relevant skills and unmatched experience, access to infrastructure for transporting CO₂, and the depleted fields in which to store it.

Prominent CCUS Projects

1. Exxon Mobil in the Gulf of Mexico and Scotland

In July, U.S.-based Exxon Mobil signed a memorandum of understanding to participate in the Acorn Project, a CCS initiative in Scotland. The project plans to capture and store approximately 5-6 million tons of CO₂ per year by 2030 from gas terminals at the St Fergus complex at Peterhead, Scotland.

Exxon Mobil recently also announced a proposal to establish a US$ 100 billion public-private CCS project that could store up to 50 million metric tons of CO₂ by 2030. The facility will be situated in the Houston Ship Channel, and captured CO₂ would be piped to offshore reservoirs in the Gulf of Mexico.

2. Partnership between Schlumberger New Energy, Chevron, Microsoft and Clean Energy Systems for a carbon-negative bioenergy project

In March, Schlumberger New Energy business unit, along with Chevron Corporation, Microsoft and Clean Energy Systems announced plans to develop a bioenergy with carbon capture and sequestration (BECCS) project designed to produce a carbon-negative power plant in Mendota, California. The BECCS plant will convert agricultural waste biomass into a renewable synthesis gas that will be mixed with oxygen in a combustor to generate electricity. The BECCS plant is expected to have the capacity to remove approximately 300,000 tons of CO₂ annually.

3. CCS project in Abu Dhabi by Abu Dhabi National Oil Company (ADNOC)

The Abu Dhabi National Oil Company (ADNOC) announced its intention to expand its existing CCS program and position itself as one of the world’s least carbon-intensive oil and gas producers. Its goal is to reduce its greenhouse gas emissions by 25% by 2030.

ADNOC’s Al Reyadah facility in Abu Dhabi can capture up to 800,000 tons of CO₂ per year, and the company plans to expand its CCS capacity more than fivefold. Recently, ADNOC entered into separate agreements with France’s Total and Italy’s Eni to explore collaboration on CCS projects.

Opportunities and Risks

There will be strong demand for the development of the CCUS sector as carbon emitters (both businesses and governments) struggle to meet emissions targets and satisfy environmental, social and governance objectives. However, several other factors can impact development in the CCUS sector:

1. Decommissioning liabilities can be offset by CCUS

Existing structures and depleted wells can be repurposed for CCUS. With more and more fields reaching the end of life, repurposing provides a way for operators to offset or delay the hefty costs associated with decommissioning oil and gas infrastructure.

2. Cost-intensive projects

Significant deployment and energy costs make carbon capture expensive. An industrial plant with a CCUS element will use more fuel (typically hydrocarbons) to extract, pump and compress CO₂ than a plant with that element would, and the costs associated with deploying a CCUS unit are capital-intensive.

Using renewable sources of energy to operate these plants would defray these costs.

3. Lack of regulations

A key challenge for CCUS, as with most new energy technology, is ensuring the development of an adequate regulatory framework. Existing petroleum and environmental legislation can be used, but certain shortcomings — such as the allocation of long-term liability for captured CO₂ — often require the implementation of specific regulations.

4. Environmental risks

A prominent concern about CCUS is the environmental risk associated with long-term storage of captured CO₂. Any leakage from the stored carbon dioxide would negate the initial environmental benefits of capturing and storing CO₂.


The Global CCS Institute estimates that global emissions must drop 50% by 2030 and reduce a further 50% from that level by 2040 to achieve net-zero carbon emissions by 2050. Currently, CCUS is likely the only technology that can significantly reduce emissions from large-scale industrial operations.

Although CCUS projects and their associated infrastructure require approximately 6-10 years from conception to commissioning, there is potential for a significant increase in the focus on CCUS in the next decade, particularly from the oil and gas sector, as hydrocarbon producers come under pressure from governments and investors to fulfill their commitments to become carbon neutral.


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