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Big oil embraces carbon capture

1 November 2023

Commentary
Colin Foreman
Editor

Read the November 2023 issue of MEED Business Review

The global drive towards net-zero emissions places the oil and gas industry at a crossroads. In simple terms, the sector faces three choices: halt oil and gas production, dismiss the global impetus towards net zero, or undertake rigorous efforts to decarbonise operations.

The industry’s predicament is reminiscent of Tancredi’s words in Giuseppe Tomasi di Lampedusa’s novel The Leopard: “If we want things to stay as they are, things will have to change.”

While the novel was set against a backdrop of political manoeuvring during the formation of the Kingdom of Italy in the mid-19th Century, Tancredi’s words will resonate with the oil and gas sector today. This is particularly true in the Middle East, where Cop28 president-designate Sultan al-Jaber has been keen to stress that hydrocarbons still play a vital role in meeting global energy needs, while accepting that operations do need to change.

Recent developments demonstrate how quickly this change is taking place. The annual Adipec conference, held in Abu Dhabi in early October, saw the largest-ever investment in decarbonisation in the Middle East and North Africa region.

Adnoc’s $17bn Hail and Ghasha offshore sour gas field development project aims to capture 1.5 million tonnes a year of carbon dioxide emissions. 

Projects like this – along with those of other regional players, such as Saudi Aramco, QatarEnergy, Bahrain’s Bapco Energies and Oman’s OQ – underscore the allure of carbon capture technologies for oil and gas enterprises, as they see it as a means to prolong the viability of their existing facilities.

There are economic challenges facing many carbon capture, utilisation and storage (CCUS) projects, primarily due to the high costs and limited revenue streams. But for a region and an industry that relies so heavily on the production of hydrocarbons, the expectation is that CCUS, which permits the continuity of traditional business models, will likely see significant funding in the future.

More on carbon capture: 

> Bright outlook for carbon capture investment
> Oil and gas faces pressing need to decarbonise
> Gulf invests to cut carbon
> Read the November 2023 issue of MEED Business Review

 

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Colin Foreman

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