Carbon capture deal could unlock up to £7bn worth of investment

Oil and gas company Harbour Energy and bp have struck an agreement to develop the Viking carbon capture transportation and storage (CCS) project in the North Sea.

Under the terms of the deal, Harbour will continue as operator of Viking CCS with a 60% interest, with bp acquiring a 40% non-operated share.

Located close to the Humber region, Viking CCS has the potential to meet one third of the UK Government’s target to capture and store up to 30 million tonnes of CO₂ a year by 2030. 

The news follows the UK Government’s recent decision to launch Track 2 of its CCS cluster sequencing process, and its recognition that Viking CCS is one of two leading transport and storage system contenders for this process.

The delivery of the Viking project could potentially unlock up to £7bn worth of investment across the full CO₂ capture, transport, and storage value chain over the next decade, creating over 10,000 jobs during construction, and providing an estimated £4bn worth of gross value add (GVA) to the Humber and its surrounding areas.

Harbour and bp already share an interest in the Lincolnshire Offshore Gas Gathering System (LOGGS) pipeline which is intended to be repurposed as part of the project.

This provides a low-cost opportunity to connect customers to the depleted Viking gas fields, which recently had their 300 million tonnes of CO₂ storage capacity independently verified.

Viking CCS also has access to a planned new CO₂ shipping terminal at Associated British Ports’ Port of Immingham, with the potential for shipped CO₂ from dispersed emitters elsewhere in the UK and internationally to be transported for permanent storage within the Viking fields.

Subject to the outcome of the Track 2 Cluster Sequencing Process, a final investment decision is expected in 2024.

The project could be operational as early as 2027 and potentially storing up to 10 million tonnes of CO₂ per year by 2030.  

Linda Cook, CEO of Harbour Energy, said: “We welcome the UK government’s recent announcement about the launch of Track 2 and the addition of bp as a partner to this transformational project. 

“Viking CCS has the potential to unlock billions of pounds of investment across the full CCS value chain and is crucial for the UK to meet its emissions reduction targets.”

Anja Dotzenrath, executive vice president of gas and low carbon energy at bp, said: “We’re extremely excited to be joining Viking CCS, a project which can play an instrumental role in helping to decarbonise the UK and providing CO₂ transport and storage as a service to emitters across industry sectors and geographies, including as a future CO₂ shipping destination.”

Louise Kingham, SVP Europe and head of country UK for bp, added: “Our entry into Viking CCS demonstrates bp’s commitment to Backing Britain through substantial investment and helping the country achieve its net zero goals.

“Viking CCS could help create thousands of new local jobs and enable supply chains that support growth of CCS in the UK.”