Change in direction of commitment to Carbon Capture and Storage

Carbon Capture and Storage (CCS) is a crucial part of the Government’s combat against climate change. In order to strengthen the effort, the Government points out a new direction for CCS. The development of  full-scale CO2-capture at Mongstad is discontinued, and will be replaced by a CCS programme.

 

The Technology Centre Mongstad, which is one of the world’s largest and most advanced, will be continued and strengthened.

The Government’s revised CCS strategy will include a programme for realization of full-scale CCS projects in Norway.  The Government will ensure the financial and other conditions  necessary to result in at least one such project. To achieve this, appropriate incentive structures, securing a clear and sensible risk division between the state and industry are necessary. In order to qualify for funding, projects will have to contribute considerably to the development of technology and also be relevant for the development of further projects.

In the proposed national budget, The Government invites Stortinget to enact both the objective of realizing at least one full-scale CCS project in Norway by 2020, and that the state ensures the financial and other conditions  necessary to result in at least one such project in Norway.

CCS is essential to combat climate change. We have made considerable progress in developing the necessary technology. The Government now re-enforces its commitment. A full-scale CO2 capture facility is still the objective. The Government has, however, concluded, after careful consideration, that the risk connected to the Mongstad facility is too high and has for that reason decided that the work on the full-scale facility will be discontinued, says Minister of Petroleum and Energy Ola Borten Moe.

He points out that integrating a full-scale capture facility at Mongstad would be both challenging and costly. The uncertainty of the project has increased, because, inter alia, the refinery industry in Northwest Europe is currently facing a hard time. At the same time, the development of the capture facility is now reaching a new phase, in which continuation would entail high costs.

We are at a crossroads, and have to consider if the full-scale CCS project should be continued at Mongstad. The Government has concluded to consider other possible projects that can be realized within 2020, as agreed in the bi-partisan Climate Agreement in the Norwegian Parliament. We have gained valuable experience at Mongstad, which can be of use in other projects, says Minister of Environment Bård Vegar Solhjell.

The low price of CO2–emissions and economic recession in most of Europe have both contributed to reduced commercial interest for CCS. This makes Norway’s strong and continued commitment more important than ever. Therefore, the Government will strengthen the Technology Centre Mongstad with NOK 400 million over four years. The allocations for CCS research and development through the research programme Climit will also be increased by NOK 100 million over two years. The Government will also promote CCS capacity building and deployment internationally.

The Government will intensify its efforts in technology development. Our commitment and high ambitions for Carbon Capture and Storage remains as strong as ever, says  Minister of Petroleum and Energy Ola Borten Moe and Minister of Environment Bård Vegar Solhjell.

 

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