Shell Joins Scottish Carbon Capture Project

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) -- Scottish and Southern Energy plc (OTC:SSEZY) (SSE) (Perth, Scotland) is forging ahead with its carbon capture and storage (CCS) project at its gas-fired Peterhead power station by teaming up with Shell U.K. Limited (London, England), to handle the storage of captured CO2.

The news comes less than a month after fellow Scottish power company, ScottishPower (Glasgow), pulled the plug on the U.K.'s leading CCS project at the Longannet coal-fired plant in Scotland. Shell was a key partner in that project and expects to bring its experience to the CO2 storage element of the Peterhead project. For additional information, see October 20, 2011, article - Scottish Carbon Capture Project Cancelled.

SSE announced that the agreement will allow it to accelerate a programme of pre-FEED (Front-End Engineering Design) studies, with the goal of beginning a full FEED study in the second half of next year. SSE is aiming to develop a full chain, post-combustion CCS facility which will be capable of capturing CO2 from one 385-megawatt (MW) combined cycle gas turbine (CCGT) unit at Peterhead, which has a total generating capacity of 1,850MW. The captured CO2 will then be transported to the Shell-operated Goldeneye gas field in the North Sea, using mostly existing infrastructure.

The Peterhead project is one of seven CCS projects submitted by the Department of Energy and Climate Change (DECC) to compete in the next round of the European Union's New Entrant Reserve 300 (NER300) fund. NER300 is worth billions of euros and will fund up to half of the cost of the winning projects. For additional information, see May 11, 2011, article - U.K. Carbon Capture Projects Compete For E.U. Funding.

SSE warned that winning funding from the NER300 fund of the U.K. government CCS demonstration project competition will play a key factor in pushing ahead with the project.

"If long-term targets for reducing emissions are to be met, CCS technology must be applied as widely as possible," explained Ian Marchant, chief executive of SSE, at the signing of the agreement. "We therefore welcomed the Government's decision to include gas-fired generation plant in its CCS demonstration programme. However, the development of a commercial-scale CCS demonstration project presents significant challenges and will require appropriate levels of support from both the E.U. and U.K. government."

Glen Cayley, Vice President - Technical, Shell U.K. Limited added: "Shell believes CCS is an essential technology in the fight against global climate change and we remain committed to developing CCS in the UK. Valuable work has already been carried out during the Longannet Project -- work that will be relevant to the proposed CCS project at Peterhead. Shell's Goldeneye reservoir offers excellent geological storage conditions in terms of pressure, capacity and availability, and we are set on finding a way to use it as a CO2 sink."

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