Alberta to back three carbon capture projects

CALGARY, Alberta, June 30 Tue Jun 30, 2009 5:12pm EDT

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CALGARY, Alberta, June 30 (Reuters) - The Alberta government said on Tuesday it will support three carbon capture and storage projects from a C$2 billion ($1.7 billion) fund set aside last year as the Western Canadian province looks to cut emissions from coal-fired power plants and oil sands projects.

The province said it expects to provide up to C$100 million this year for design and engineering work on the three proposals, selected after a year-long competition, and expects to have letters of intent signed with the backers next month.

Carbon capture and storage projects capture carbon dioxide from industrial facilities before it enters the atmosphere, and then pump it into the ground. Still in experimental stages, the technology is being touted by government and industry as a way to meet targets for reducing emissions of greenhouse gases, without cutting economic growth.

The three projects being backed by Alberta include carbon capture and storage at Royal Dutch Shell Plc's (RDSa.L) Scotford oil sands upgrader; a carbon-capture facility at a power plant owned by Epcor, Edmonton, Alberta's municipally owned utility and backed by Enbridge Inc (ENB.TO); and a project to take carbon dioxide from an Agrium Inc (AGU.TO) fertilizer plant as well as a planned upgrader and ship it by pipeline to oilfields, where it will be used to boost output.

The province said in a release it expects the three projects to achieve annual carbon dioxide reductions by 2015 equivalent to taking about a million vehicles off the road.

($1=$1.16 Canadian) (Reporting by Scott Haggett; editing by Rob Wilson)

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