LONDON (Reuters) - Oil and gas major Shell stepped up its involvement in carbon capture and storage (CCS) technology on Wednesday by formalizing its partnership with Britain’s SSE to install CCS technology at one of the utility’s Scottish gas-fired power plants.
The two companies signed a joint development agreement for the Peterhead CCS project on Wednesday, three weeks after the British government scrapped plans to fund a CCS project at Scottish Power’s Longannet coal-fired plant.
“Shell believes CCS is an essential technology in the fight against global climate change and we remain committed to developing CCS in the UK,” said Glen Cayley, vice president at Shell UK.
The two companies plan to capture carbon emitted from one 385 megawatt (MW) turbine at SSE’s Peterhead gas-fired power plant, which will then be transported to and stored in Shell’s depleted Goldeneye offshore gas field.
A detailed engineering study for the project is scheduled for the second half of 2012, depending on whether it will be successful in securing EU and/or UK government funding.
Britain plans to cut greenhouse gas emissions by 34 percent below 1990 levels by 2020 and CCS technology fitted to carbon-intensive power plants is considered key to reaching this target, but the technology has so far not been developed to commercial scale.
CCS projects were thrown into doubt after the government’s decision not to fund the Longannet project, but the energy ministry said it remains committed to the technology and blamed its decision on project-specific problems.
“We will be considering projects through an open and transparent selection process to be launched as soon as possible,” a spokesman for the ministry said, referring to the government CCS funding scheme which had set aside around one billion pounds for the country’s first scheme.
Reporting by Karolin Schaps