Carbon capture projects in Southeast Asia are likely to attract strong interest from governments and investors as energy demand in the region is poised to grow by 35% in 2030, said energy experts.
Energy expert Takashi Akai with Japan Organisation for Metal and Energy Security (JOGMEC) said as the usage of fossil fuel is deeply entrenched in SEA’s future energy generation, the carbon capture, utilisation and sequestration (CCUS) will emerge as a growth sector for companies that provide specialised services in the area of emission reduction.
“In order to continue to use fossil fuel well, everyone needs to think about using that resource in a greener way. If SEA countries want to keep using hydrocarbons, then they (SEA governments and stakeholders) have to think about the future.
“Hydrocarbon usage produces a lot of carbon dioxide (CO2) which is emitted. This should not be allowed anymore. This has to be captured and stored for the sake of the environment,” Takashi told The Edge after a panel session entitled “Development of CCUS in Asia-Pacific: Storage or emissions-led?” at the Energy Asia 2023 Conference on Tuesday (June 27).
He added Malaysia is on the right track to play its part in reducing carbon emission with state oil firm Petronas deciding to develop the Kasawari carbon sequestration project in offshore Sarawak.
The Kasawari project, which is located in Block SK316 off Bintulu town, is expected to reduce 3.3 metric tonnes of carbon dioxide (MtCO2e) emitted annually, making it one of the largest offshore carbon capture and storage (CCS) projects in the world.
CCUS involves the capturing of carbon oxides from an emissions stream prior to being released to the open atmosphere. It is then stored deep underground in geological formations.
Carbon capture requires significant investment in equipment due to the complexity of the process involved.
However, the lack of economic use for the carbon capture remains a fundamental problem with these projects, said Jon Story, executive vice-president of M&A and portfolio of Storegga.
Storegga is pioneering carbon dioxide capture, removal and storage solutions tackling emissions and supporting the race to net zero.
He said with lack of profits to be made, and higher investment into carbon capture technologies, governments and investors have to look at this initiative as a way to help tackle climate change.
“Fundamentally countries have to accept that this will cost money through investment. In its purest form, CO2 emission is actually a waste disposal and there is no revenue in this. But it is the government decision to commit to net zero emissions targets,” Story said at the panel session.
However, creating a strong carbon capture industry by setting up a legal framework in the region could attract stronger investment, said Brad Crabtree, assistant secretary of fossil energy and carbon management at the US Department of Energy.
He added, CO2 emission sources are often dispersed across many countries and locations, often far from storage sites. Hence he suggested governments and carbon capture industry players too look into facilitating cross-border carbon collection.
It means CO2 generated in one jurisdiction is collected and transported for permanent storage in another.
“There is major effort underway to develop policies and framework and cross- border side of it. There is an increasing discussion between governments and industries about crediting carbon capture storage across the region which I think is valuable,” said Crabtree.
However Crabtree reiterated, the legal framework around such a transaction has to be discussed and firmed up, which could take a long time, he said at the panel session.
Source: The Edge Markets