Accelerating the demonstration of CO2 geological storage in Europe: The case for up to six new storage pilots

Content

INTRODUCTION. 3
1. The wide demonstration of CO₂ storage is key to the development of CCS in Europe 3
KEY RECOMMENDATIONS 4
REALISING THE VAST POTENTIAL OF DEEP SALINE AQUIFERS 7

Introduction

The critical role of CCS in meeting European Union (EU) and global climate targets is now indisputable: the EU Energy Roadmap 2050 confirms that “For all fossil fuels, Carbon Capture and Storage will have to be applied from around 2030 onwards in the power sector to reach decarbonisation targets”, while the IEA estimates that the global costs of achieving climate objectives without CCS would be 40% higher.

Yet the potential for CCS goes far beyond power, with other industrial applications expected to deliver half of the global emissions reductions required by 2050 from CCS.² Indeed, in some industries, such as steel and cement, it is the only means of achieving deep emission cuts. Combined with sustainable biomass, CCS can even remove CO₂ from the atmosphere – already recognised as a significant and attractive abatement solution. Crucially, CCS will also complement intermittent renewable energy sources with low-carbon, base-load, and balancing generation.

In short, CCS will not only deliver substantial emission reductions across a range of industries, but provide the catalyst for economic growth – creating and preserving jobs – while ensuring a diverse and reliable energy supply.

The wide demonstration of CO₂ storage is key to the development of CCS in Europe

CCS is on the critical path, and there is no doubt it can deliver, as confirmed by international developments where final investment decision (FID) has already been taken on large-scale demonstration projects in Australia, Canada, and the U.S.

However, the fall in the price of Emission Unit Allowances (EUAs) – from ~€30 per tonne in 2008 to less than €5 today – has had a severe impact on the EU CCS demonstration programme: with significantly less ‘NER 300’ funding available, the number of projects will be considerably reduced. While the need for large-scale demonstration projects remains a priority, they may also not have the flexibility and capacity to address issues that could be more effectively addressed by smaller, research-oriented, storage pilots.

Given that the lack of proven, affordable, local CO₂ storage sites is a key barrier to the development of CCS, it is therefore essential that up to six pilot-scale storage projects are operational across Europe by 2020 to complement potential NER 300 and EEPR projects. Ideal testing grounds for accelerating state-of-the-art technology, they will address such issues as storage optimisation, pressure management, deep saline aquifer qualification, and site closure protocols. Qualifying and improving knowledge of different geological storage conditions will also greatly benefit the planning of a trans-national, European CO₂ transport infrastructure.

As showcases for the successful demonstration of CO₂ storage, a portfolio of storage pilots will not only increase financial, technical, political, and public confidence but also pave the way for wide-scale CCS deployment.

This document therefore provides an overview of the key storage options available across Europe, with recommendations for how these could be incentivised.

Key recommendations

Urgently establish up to six new CO₂ storage pilots, EU-wide

In order to address the full range of geographical and geological issues, up to six new CO₂ storage pilots must be operational by 2020. These should be located across different European countries, where the geology is considered representative of structures suitable for industrial-scale storage and where further R&D can be addressed. A screening study should therefore be initiated as a matter of urgency: catalogue storage options that exist, identify research objectives, establish a budget structure, and then execute the projects.

Data obtained can then be used to improve regulations, identify options for cost reduction, assess business cases, and contribute to the design of the full CCS value chain.

Focus on deep saline aquifers – on- and offshore

Storage pilots are needed both on- and offshore: offshore storage is the focus of many proposed CCS demonstration projects and the main option for Member States bordering the North Sea, while onshore storage is more cost-effective, and pilots will help to resolve any outstanding issues related to regulatory compliance. Both options, however, offer opportunities to investigate storage and operational characteristics that can be used generically, both on- and offshore.

Whilst pilots should cover the representative storage cases – pure deep saline aquifers (SA) and SA in combination with depleted oil and gas fields – the emphasis should be on SA as they hold the greatest storage potential for continental Europe, yet have generally been poorly investigated. It is particularly important that operational procedures for SA storage are developed and tested.

Select storage sites that will enable meaningful, scientific R&D

Pilot storage sites must be large enough to enable meaningful, scientific R&D on a range of issues that can be extrapolated at industrial scales from representative geological structures, which may contribute significantly to Europe’s storage capacity. In certain cases, the storage pilot may also be used to explore industrial-scale storage in the same reservoir.

Pilots should store in the range of ~30,000 to 100,000 tonnes of CO₂ (above 100,000 tonnes would require permitting according to the CCS Directive), and be able to display the issues associated with all stages of the lifecycle in a condensed period. They should also be set up as a platform for testing cost-effective engineering solutions, in contrast to demonstration or commercial projects where the use of off-the-shelf technologies would be expected.

Sedimentary basins host fossil fuel, groundwater, and geothermal energy resources, as well as providing options for gas storage and the permanent disposal of fluids. Storage pilots can therefore also provide the basis for defining key factors that affect the interaction of such resources with CO₂ storage, guiding policymakers and regulators on the allocation of pore space and resource interaction management, and clarifying the potential impact of interaction on storage capacity and availability.

Support the deployment of Europe’s CO₂ transport infrastructure

Increasing knowledge of characteristic geological storage, operational conditions and restrictions will ensure potentially suitable storage sites – capacity and injectivity are much better qualified in the early phase of planning. This will not only facilitate the planning of a European CO₂ transport infrastructure but also reduce technical and financial risks significantly.

Maximise the benefits of CCS for local communities

While a few CO₂ storage projects have been taking place successfully in Europe over the past 15 years, they are not widely known to the general public. The majority of CCS activities in Europe to date has also been carried out by the utilities, who – for onshore storage projects at least – have experienced some difficulties in convincing the public and local authorities of the vital necessity of CCS for combating climate change.

However, this has proved easier when working in partnership with other CCS stakeholders and experts, e.g. research institutes to guarantee credibility and transparency; industrial actors (cement, steel, chemical, refining etc.) to highlight the importance of job preservation and synergies in CO₂ transport and storage; and policymakers and regulators to demonstrate that CCS is a critical part of the overall “green” policy for Europe.

Storage projects should therefore include professional communications activities that address critical, non-scientific issues of public perception, with local communities actively involved, in addition to regulators and policymakers. Indeed, they should be open-access laboratories that promote education and training, with independent research organisations playing a major role.

Public support is likely to be stronger where some or all of the following criteria apply:

There is perceived to be a significant local benefit in terms of employment or the regional economy, e.g. the creation/preservation of jobs.
The project is undertaken by an entity with an established, positive relationship with the local community.
The project offers an open platform where all stakeholders can test new methodologies and equipment, and where results are shared widely and rapidly with the public.
Storage is in line with other local drivers, e.g., the CO₂ stream is derived from biomass in a market that is focused on moving entirely to renewable energy sources, or enhances oil production in a region where this is an established industry.
Storage is integrated into a regional or national plan for developing efficient, decarbonised energy systems in the context of “green growth”.

Several value-generating aspects could therefore be incorporated into the design of storage projects, e.g.:

CCS combined with sustainable biomass (Bio-CCS)
Other uses of CO₂ (CCU and/or CCUS¹⁰), e.g. for greenhouses
Cooperation between energy-intensive industries: power, iron and steel, chemicals, cement and fuel transformation
Combining CO₂ storage with geothermal energy to benefit local communities
The local risk to people and property is perceived to be small, e.g., due to a sparse population, a low amount of CO₂.

Finance storage pilots from a combination of sources

Each storage pilot will cost €40 to €80 million (i.e., at least €30 million of capital + €10 million contingency), encompassing a large scientific component (storage optimisation, monitoring, public outreach) and an even larger component for data acquisition, drilling, and CO₂ supply. This is one order of magnitude cheaper than a fully integrated CCS demonstration project, thus delivering significant added value in return for a modest financial investment. However, in the absence of a viable business model for storage in the near future, financing these ventures will require pooling efforts from industry and other stakeholders.

Separate funding is needed for the sourcing and transport of CO₂ to the storage sites. Truck-based CO2-sourcing could potentially be arranged by contractual agreements with ongoing or planned CO₂ capture pilots where the CO₂ otherwise would be emitted. If planned, parts of the high-capex surface facilities could potentially be shared between several pilot projects.

There are several possible financing mechanisms, including:

The upcoming Horizon 2020 programme, which should follow up with additional calls for the R&D component of large storage pilots, supplemented by a funding mechanism for the necessary ‘hardware’ investment (wells, seismic, etc.)
National and regional funding
Co-funding of projects in other Member States: Member States may have an interest in supporting the development of storage in other countries (e.g. due to the lack of domestic storage capability). Mechanisms such as the Norwegian EEA¹¹ funding, which already support the Polish Belchatów project, or the so-called ‘Berlin model’ offer such opportunities.
Industrial funding is frequently required, especially for equipment which is not R&D-specific, e.g. drilling, seismic, and CO₂ sourcing.
Although the main focus should be on SA, individual projects may combine with Enhanced Oil/Gas Recovery (EOR/EGR), utilising the additional revenue from oil production. There are numerous old oil provinces in Europe, and the projects could act as a precursor to offshore EOR in the North Sea and elsewhere.

However, a combination of all available resources should be targeted.

Simplify the permitting process and relieve projects of the burden of liability

Projects that fall under the CCS Directive currently have to undergo a long and complex permitting process and assume liabilities far beyond the operational period. Yet Ketzin and other storage pilots have shown that simpler regulations can be conducted without any reduction in safety. Comparable procedures, taking into account the legal situation within individual Member States, should therefore be introduced for industrial-scale projects.

Although different regulatory regimes apply to research-scale projects (<100 k tonne of CO₂ stored), storage pilots will provide useful information for ongoing work on permitting and consenting guidelines.

Maximise knowledge-sharing with EU and international CCS demonstration projects

Storage projects should not only share knowledge within the European CCS Demonstration Project Network, but also with international projects, e.g. the U.S. Regional Partnerships have demonstrated a successful strategy for establishing pilots.

Realising the vast potential of deep saline aquifers

Deep saline aquifers have an enormous capacity for CO₂ storage

Deep saline aquifers (SA) are prime targets for CO₂ storage, not only due to their wide availability worldwide, but also their large static capacity – estimated to be at least 10 times greater than depleted oil and gas fields. Limited economic interest to date also creates a business opportunity, as they have not yet been systematically explored.

However, except selected SA that have been investigated for specific projects (e.g., gas storage, geothermal, CCS), knowledge of the potential effective capacity, infectivity, and long-term integrity for the majority of reservoirs is quite poor and needs to be proven through extensive qualification studies.

Storage pilots have a dual purpose:

Prove that CO₂ storage is feasible for storage and transport permits, assessment of storage capacity, cost-effective engineering solutions, storage operation, monitoring, injectivity and storage containment, liability transfer, and public awareness.
Explore and qualify common parameters for a range of SA that project developers can then utilise to improve the development of industrial-scale sites.

Selecting optimal storage sites

Naturally, a storage site will only be selected if prior analysis shows that under the proposed conditions of use there is no significant risk of leakage or damage to human health or the environment.

Location

There are several considerations for determining the preferred location of a storage pilot:

The ability to address specific issues related to geological features, e.g.
- Containment mechanisms, e.g., structural or stratigraphic trapping, migration-assisted trapping
- Complex storage geology: storage reservoir and cap rock type (described in further detail below)
Factors that make the site particularly attractive, e.g. ,pre-existing knowledge of the storage complex, low-cost availability of CO₂ for injection, or the potential for subsequent expansion into an industrial-size storage site
Represents a good example of how to define the storage complex of a storage site.
Factors which make the project cost-effective, e.g,. value creation in the form of CCU and/or CCUS applications (for greenhouses, storage combined with geothermal heat production, etc.).

In order to maintain project momentum, it is easier if sites are selected where surveys have been conducted and exploration consents are already in place, e.g., as part of stalled or ongoing EEPR/NER 300 projects or national programmes. Data may also be available from gas and oil extraction sites where SA lie above or below the petroleum and have been characterised as part of the overall assessment of the region (as in the storage atlas published by the Norwegian Petroleum Directorate in 2011).

Geology

Ideally, pilot sites should cover the full range of potential geological environments. Reservoir rock types should span the range from siliclastic to carbonate rocks; caprocks should include shales, marls and evaporates. Reservoir flow properties should focus on pore-space permeability, but also cover fracture permeability. Structurally, it would be useful to cover at least two different types of aquifer system: those which are tightly, locally bounded and act as local storage zones; and those which are extensive, where the pressure effect of the injected CO₂ (not the CO₂ itself) has the potential to have an impact over a significant

distance. In general, SAs have little economic value, so where they have historically been detected in geological studies, they have been recorded but not fully documented. For storage to be qualified, this level of knowledge is insufficient so a substantial amount of characterisation work is needed which, in turn, requires significant consents to be in place.

Size

Typically, a site with a few injection/monitoring wells and a limited CO₂ supply (in the range of 30,000 to 100,000 tonnes) should be sufficient to address remaining knowledge gaps.

CO₂ supply

In order to increase knowledge and visibility of the entire CCS chain, it would be advantageous to use CO₂ derived, at least in part, from suitably-sized capture pilots where the CO₂ would otherwise be emitted. The following (non-exhaustive) list includes some facilities with capture rates of >1 tonne/day, which may be appropriate (if their geographical location is suitable and the projects overlap in time):

Germany: Heilbronn, Niederaußen, Wilhelmshaven, Schwarze Pumpe
UK: Ferrybridge, Aberthaw
France: Lacq (already in use), Le Havre
Norway: Test Centre Mongstad
Italy: Brindisi
Spain: Ponferrada.

If these plants are unsuitable (e.g., due to location or the fact that it is not their primary objective to produce CO₂), then other CO₂ sources may be attractive. Slipstreams of CO₂ produced as an industrial by-product in petrochemicals, gas treatment, or biomass processing plants may be available at relatively low cost – although the quality may be sub-optimal for storage (e.g,. natural gas processing plants in northern Croatia (Molve) and central Hungary (Szank)).

Naturally occurring CO₂ could also be used for storage projects, as it has happened with the U.S. Regional Partnerships. Substantial sources occur in Hungary (currently under production for EOR), with smaller occurrences in Slovakia, southern France and several other locations in western Europe. Alternatively, as mainly happened with the Ketzin project, high-grade CO₂ can be purchased from the gas market.

Storage operation

In SA operations, the magnitude and spatial extension of the pressure response are probably the most important criteria for evaluating the storage horizon. A distinct variety of lithological, as well as structural geological cases, should therefore be covered.

In locally confined structures (e.g., by closed faults) or low-permeability lithologies, rapid pressure increases may be observed, enabling the rapid testing of the full lifecycle of a storage site. Special attention should be given to the recovery phase after injection. Plume development, pressure development, longer-term trapping mechanisms, and even possibly leakage processes (via faults or caprock), are subject to investigation. On the operational side, storage/injection optimisation, remediation measures, in addition to well monitoring and abandonment methodologies, are in focus. Data gathered should serve to improve the parameterisation and verification of static and dynamic models.

In larger structures or highly permeable lithologies, the pressure response may only be calculated from injectivity. In this case, caprock integrity or geochemical investigations may be of greater relevance. However, long-distance observation wells may help to study the lateral extension of the pressure effects on the SA, as well as the lateral footprint of displaced saline formation water.

The simulation of industrial cases should also be in focus: where CO₂ from capture pilots is used, the effect of process-related impurities on geochemistry can be investigated; if CO₂ is purchased from the market, admixtures can be added to simulate industrial cases. The variable injection of CO₂ – thereby reproducing conditions in future transport systems – will also improve operational knowledge.

Research deliverables

The storage pilots will improve knowledge of various processes under different geological conditions, as well as operational issues, including:

Spatial development of the CO₂ plume – steering, control mechanisms, saturation distribution, re-production of CO₂
Improved resolution of geophysical mapping methods, particularly in SA with sparse data; also for tracking CO₂ plumes and saturation gradients
Improved static and dynamic modelling tools
The fate of the CO₂ – dissolution, residual trapping and associated time-scales, processes at pore-scale, res-sublimation of CO₂ in the pore network, saturation fronts, processes at grain surfaces, impact of wetability and subsequent change
Pressure build-up – monitoring and control, water production, combined CO₂ storage, and geothermal heat extraction
Integration of the full value chain, includingthe operation of CO₂ storage facility, such that CO₂ production facility has maximum availability
Improved knowledge of hydraulic properties of faults (tight or not, methods, resolution, remediation)
Wells and equipment: cheap wells for exploration and observation, cheap re-completion equipment (e.g., plastic liners), durable long-life monitoring sondes.
Well closure and abandonment procedures.

In order to maximise the added value of the storage pilots, they should build on existing expertise in running or planning pilot sites, e.g. Ketzin (Germany), Lacq (France), Hontomin (Spain), and K12-B (Netherlands). These already provide a framework of different geologic environments, which the new pilots could complement by closing any remaining gaps. The diachronous evolution of the various sites will result in a portfolio of storage pilots at different stages of the lifecycle, thus consolidating knowledge gained from the entire storage operation.

Finally, in order to maximise the benefit to the European CCS community, the pilots should ideally be organised under an open platform where all stakeholders can test new methodologies and equipment, and where results are shared widely and rapidly with the public.