Two US projects highlight divide over carbon removal’s role in climate
fight
Send a link to a friend
[November 28, 2023]
By Valerie Volcovici
(Reuters) - In Texas, oil and gas producer Occidental Petroleum is
constructing a giant facility to suck 500,000 tonnes of carbon dioxide
out of the atmosphere annually to keep it from warming the climate, a
project backed by hundreds of millions of dollars from investment firm
BlackRock.
In Louisiana, a consortium of companies that includes Swiss firm
Climeworks is teaming up to build a similar facility that can pull a
million tonnes of the greenhouse gas out of the sky each year, boosted
by hundreds of millions of dollars in grants from the U.S. government.
The direct air capture (DAC) projects are in neighboring states, but the
companies leading them are worlds away when it comes to their views on
how carbon removal - an expensive and largely unproven family of
technologies to fight or even reverse global warming - should be
deployed in a climate-friendly future and the role oil and gas should
play in its deployment.
Occidental says some of its carbon would be injected into oil fields to
ramp up pressure and raise crude production – a strategy it says that
can cleanse the world’s future fossil fuel consumption of climate
impact.
Climeworks and its partner Heirloom, meanwhile, says its carbon will go
straight into underground storage, and that the technology must go hand
in hand with a transition to renewable energy.
The clashing philosophies mirror a global debate underway over the role
carbon removal technologies should play to keep the world from exceeding
a 1.5 degree Celsius rise that will take center stage at the 28th United
Nations climate change conference in Dubai on Nov. 30-Dec. 12.
The COP28 conference's hosts, OPEC member the United Arab Emirates, is
promoting the use of carbon removal - a family of technologies to keep
excess CO2 out of the atmosphere - as a means of reducing emissions from
fossil fuels, as opposed to eliminating the fossil fuels themselves.
Scientists have said carbon removal is needed to keep climate goals
alive.
That approach has the backing of global producers seeking to continue
profiting from fossil fuels, but draws skepticism among
environmentalists and some governments who see it as a ploy to prolong
the lifespan of oil and gas and who are pushing for tough language at
COP28 to phase out fossil fuels completely.
Underscoring the rift, the International Energy Agency (IEA) said last
week that the oil and gas industry is over-relying on carbon capture to
reduce emissions and called the approach "an illusion," sparking an
angry response from OPEC which views the technology as a lifeline for
future fossil fuel use.
“We think that no amount of direct air capture as an industry should be
used as any justification for prolonging of expanded fossil fuel
production,” said Vikrum Aiyer, head of climate policy at Heirloom,
which is a partner in the Louisiana facility called Project Cypress.
The differing approaches also reflect an important financial dynamic in
the carbon removal industry: In the near term, it is a lot easier to
make money trapping carbon if it comes with a perk like higher oil
production.
Otherwise, the enormous price tag for world-scale carbon removal would
need to fall to governments if there is any chance of these projects
surviving.
SAVIOR OR FIG LEAF?
The IEA says DAC would have to capture as much as 1 billion tonnes
annually by 2050 if the world is to hit its decarbonization targets, a
massive scale-up from the 10,000 tonnes it removes currently.
[to top of second column]
|
A person looks at stacks of trays holding treated limestone, used to
absorb CO2 form the air, at Heirloom's new plant, in Tracy,
California, in this handout picture obtained by Reuters on November
9,2023. Heirloom Carbon/Handout via REUTERS/ File photo
A major concern is that DAC technology is both expensive and
unproven at scale. Capturing carbon using DAC costs somewhere
between $600 and $1,000 for each tonne, mainly because of the huge
amount of energy required to run the equipment.
There are two commercial DAC facilities now in operation – a
Climeworks project in Iceland that can capture just 4,000 tonnes of
CO2 a year and Heirloom's project in California that can capture
1,000 tonnes annually, with the rest of the emissions removed by DAC
attributed to small pilot projects.
More than 100 other DAC projects are at various stages of
development, but it is unclear how many will be completed or when,
or how they would survive financially.
More mature carbon capture and storage (CCS) technology, which traps
emissions at a point source like a smokestack, also requires a rapid
scale up to make a difference. There are 41 operational commercial
CCS projects worldwide with the capacity to store 49 million metric
tonnes annually, according to the Global CCS Institute - about
one-thousandth of the world’s total energy and industry-related CO2
emissions.
Most of those use the carbon for enhanced oil recovery (EOR) or are
linked to ethanol plants seeking to generate low carbon credits,
according to the institute.
Incoming COP President Sultan al-Jaber has said that the technology
to capture or remove carbon is needed in “any realistic scenario” to
meet the world’s climate goals. The UAE’s national oil company ADNOC
recently teamed up with Occidental to evaluate investment in DAC
plants and CO2 sequestration hubs in the U.S. and the UAE.
'LICENSE TO CONTINUE'
Occidental CEO Vicki Hollub has said DAC could give the oil industry
“license to continue to operate for the next 60, 70, 80 years.”
The company says its Stratos project in Texas would use removed
carbon to recover oil, or otherwise to generate carbon credits that
allow it to brand its oil as “net zero,” and the fuels refined from
it as “low carbon.”
“What we're saying is that there is a highly transparent, highly
credible way of tackling the emissions from those barrels of oil,"
said Mike Avery, president of 1PointFive, an Occidental subsidiary
developing its DAC projects.
Occidental also has a separate DAC hub proposal in Texas that won
half a billion dollars in federal grants. That project’s CO2 will be
sequestered underground and have no link to oil and gas, the
Department of Energy said.
In Louisiana, the proponents of Climeworks and Heirloom's Project
Cypress want to make it clear that the technology should have no
role in prolonging the future of fossil fuels, even if it means
committing to more limited revenue sources than rivals like
Occidental.
Their money will be made instead by marketing carbon removal credits
to corporations not involved in fossil fuels that wish to offset
unavoidable emissions, or to governments seeking to stay on track
with climate targets.
“If you use air capture to get more fuels out of the ground, you're
taking away market potential for renewables," said Christoph Gebald,
CEO of Climeworks. "This is not in alignment with the energy
transition.”
(Writing by Richard Valdmanis; Editing by Marguerita Choy)
[© 2023 Thomson Reuters. All rights
reserved.]This material
may not be published, broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content. |