DUBAI, United Arab Emirates — Oil wealthy Abu Dhabi and its nationwide oil firm are eyeing new partnerships in carbon seize know-how as rising oil costs put a renewed deal with massive oil’s local weather mitigation methods.
“There is no such thing as a credible manner of reaching international local weather targets with out significantly advancing and making certain the widespread adoption of carbon seize and storage,” Sultan Al Jaber, UAE Minister of Business and Superior Expertise and Abu Dhabi Nationwide Oil Firm (ADNOC) Managing Director and Group CEO stated over the weekend.
Carbon seize and storage (CCS) know-how goals to cut back the extent of carbon that is launched into the ambiance via standard energy era and industrial processes by storing waste carbon in a spot the place it will not enter the ambiance, usually underground. Lengthy-term carbon storage is a reasonably new idea, and its environmental, financial and technical points are nonetheless being debated.
ADNOC, which pumps greater than 3 million barrels of oil a day, has pledged to decrease its greenhouse fuel emissions and increase CO2 storage. It joins a protracted checklist of oil majors which have come under increasing pressure to speed up climate efforts as greater costs put the trade on a extra sustainable path.
“This goes past simply the oil and fuel trade,” Al Jaber stated. “I see a possibility and an essential function for carbon seize and storage throughout sectors which might be exhausting to decarbonize and that use probably the most power, akin to heavy trade, manufacturing and chemical substances,” he added.
Al Jaber made the feedback final week at a digital CERAWeek panel session alongside Vicki Hollub, CEO of Occidental, and power economist Dan Yergin, Vice Chairman of IHS Markit.
Oil costs spiked on Monday, with Brent crude topping $70 after an attack on Saudi oil facilities and after OPEC and its allies determined to maintain manufacturing cuts in place in April. Increased costs are a boon for the important thing oil exporters of the Gulf, like Saudi Arabia and the UAE, which nonetheless rely closely on oil export revenues to drive financial progress. Oil prices collapsed below zero and into negative territory in April final 12 months.
ADNOC not too long ago partnered with French oil main Complete to discover alternatives in CO2 emission reductions and CCS. It comes because the UAE goals to cut back its carbon depth an extra 25% over the subsequent decade.
“We proceed to see it as a recreation changer, and we’re very able to accomplice with others inside and even outdoors our trade to allow wider CCS adoption,” Al Jaber stated.
ADNOC, which has plans to aggressively ramp up oil manufacturing capability in coming years, says it can seize 800,000 tons of carbon dioxide yearly via its Al Reyadah facility in Abu Dhabi. As oil manufacturing capability grows, it additionally plans to increase the capability of this system to seize 5 million tons yearly by 2030.
“Carbon seize, utilization and storage (CCUS) might want to kind a key pillar of efforts to place the world on the trail to net-zero emissions,” the Worldwide Vitality Company stated in a publication final 12 months. “After years of gradual progress, new funding incentives and strengthened local weather targets are constructing new momentum behind CCUS,” it added.
Al Jaber, who’s additionally the UAE’s particular envoy for local weather change, did not say what kind of partnerships the corporate was in search of to kind. ADNOC not too long ago stated its additionally exploring the potential of recent fuels akin to hydrogen, which Al Jaber stated reveals “nice promise as a near zero-carbon gas” that might be produced at scale as a part of ADNOC’s current hydrocarbon worth chain.
Al Jaber additionally expressed optimism on the constructive impression of vaccines and stimulus packages on the worldwide financial restoration, which feeds instantly into oil demand.
“Wanting regionally, we see that one of many main powerhouses of the worldwide financial system, China, has already recovered in GDP phrases, and is again to strong progress,” he stated. “We anticipate one other key participant within the international financial system, the U.S., to return to its pre-Covid stage of GDP this 12 months and proceed rising into 2022,” he added.
Al Jaber additionally pointed to the bettering restoration in oil demand, which fell to lows of round 75 million barrels per day on the peak of worldwide lockdowns. “International consumption is at present round 95 million barrels per day and we anticipate it to rise above pre-Covid ranges by the tip of this 12 months,” he stated.