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CCUS Hubs Study Summary - Web
CCUS Hubs Study Summary - Web
NOVEMBER 2023
The Western Australian (WA) LNG Jobs Taskforce commissioned CSIRO and GCCSI
to undertake a study into the potential for developing Carbon Capture Utilisation
and Storage (CCUS) hubs in Western Australia. This is a summary of key findings.
Further information about the study partners and a glossary is included on page 16.
Ø
CCUS is critical to CCUS is CCUS is a globally WA has the WA has large-scale WA has industries WA has an existing WA CCUS hubs WA CCUS
achieving net zero currently the only tested, safe and capacity to store emissions-intensive that contribute to workforce with would support hubs have the
technologically established not only its own industries that emissions but also the skills and cross-sector potential to attract
> page 3
viable option to method for carbon, but that are clustered in has infrastructure experience to collaboration significant overseas
decarbonise a decarbonisation of other carbon areas where CCUS with the potential develop CCUS towards investment to the
number of existing and is already emitters— hubs can play an to be leveraged hubs—which will decarbonisation WA economy and
emissions-intensive being established including overseas important part or repurposed secure jobs for the including the enhance economic
industries including globally through carbon emitters of the emissions for CCUS hubs existing workforce co-location relationships with
gas processing, government who are already reduction portfolio and develop a of hydrogen regional partners
> page 10
aluminium refining, and industry seeking carbon skilled workforce and ammonia
> page 9 > page 13
cement and fertiliser partnerships storage options for WA industries
production
> page 5 > page 8 > page 11 > page 12
> page 4
ENABLED BY: RECOGNITION OF CCUS IN WA’S EMISSIONS REDUCTION MEASURES, APPROPRIATE POLICY AND REGULATORY FRAMEWORKS AND ACTION NOW TO ALLOW FOR THE LEAD TIMES OF 7–10 YEARS.
2
Ø Achieving net zero: The challenge
Australia’s commitment to net zero
Australia, along with a growing coalition of nations, has
signed up to achieving net zero emissions by 2050 in order
to limit global warming. Western Australia has set targets
consistent with this goal.
Western Australia contributes 82 million tonnes per annum (M tpa)
CO2 equivalent (CO2e), or 17%, to Australia’s total greenhouse
gas emissions. Of that, 66M tpa is from emissions-intensive
industries such as oil and gas, mining and power generation.
3
manner, we need a portfolio of abatement
strategies and technologies including CCUS.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Ø Achieving net zero: The role of CCUS
The International Energy Agency (IEA) identifies four Cumulative emissions reduction by mitigation method Current and required annual
emissions reductions technologies that are essential in the IEA’s 2021 Global Net Zero Scenario 2021–2050 capture of CO2 through CCUS
for achieving net zero by 2050. One of these is carbon
capture, utilisation and storage (CCUS).
4
reduce WA emissions by
up to one third.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Ø Achieving net zero: The opportunity
A vital and growing global industry Pilbara industrial source annual emissions to 2050 (Mtpa)
CCUS is a growing industry. The IEA estimates that in the US
alone, investment in CCUS is estimated to be in the region of Net Pilbara annual emissions CO2 stored Stage 1 CO2 stored Stage 2 Additional CO2 stored if Stage 2 is accelerated
US$27 billion per year.
WA’s geology, technological expertise, existing infrastructure and 24
geopolitical landscape make it well positioned to become a global 22
player in CCUS through the establishment of CCUS hubs.
20
5
and geopolitical landscape to be
a global CCUS player if it acts now.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Hubs example: Pilbara and Perth–Kwinana
Industry landscape Emission sources Carbon capture potential
CO2 N O RTH
CA R N A R VO N
Pilbara Hub
B A S IN
PI L BARA HUB
Perth–Kwinana Hub
CO2
PERTH– KW I NANA HUB
Perth–Kwinana Stage 1 Perth–Kwinana Stage 2
2.0 M tpa CO2 from higher An additional 2.2 M tpa CO2
CO2 concentration emissions from lower CO2 concentration
sources including ammonia emissions including post-
processing and cement. combustion gas turbines.
$160 $174
Perth–Kwinana Hub: costs per tonne C02
$140 $138
$280
$120
$260
$100
$240
$80 $73
$220 $68
$60
$200
$40
$180
$20
$160
$0
$140 Stage 1 Stage 2 Stage 3
$120 Storage
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
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Carbon storage capacity
The modelled Pilbara example would have a capacity WA’s existing and
to sequester 40 M tpa—a similar amount to that prospective capacity
currently being stored annually across the globe.
Overall WA has abundant potential capacity to store
CO2. The study shows a total prospective storage Geological basin highly
suitable for CO2 storage
resources of 195,000 M t CO2. North Canarvon Basin
alone with prospective storage resources of 48,000M t
is sufficient to store all WA’s current annual emissions
for 700 years.
This means that WA has the space to store its
own CO2 as well as that of others—opening
up a market to other emitters in the region 8Mt
Gorgon
and supporting the decarbonisation
of the Asia–Pacific region which is
ity
geologically unsuitable for CCUS.
ial
erc
Gorgon 12
0Mt
co
potential to become a
e
nc
fields 44
gc
Producin
emissions economy. g fields 6
rea
Fields u ,300Mt
Inc
nder ap
praisal 4
,900Mt
Saline
Rang aquife
e of u rs 195
ncerta ,000M
inty t
Enablers/accelerators
1. A regulatory regime to 2. Support the exploration and Enough capacity to store 700 years
8
establish rights-of-way appraisal of prospective of WA emissions and that of our
to CCUS hubs storage resources regional partners.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Reducing emissions
Emissions in Western Australia Breakdown of source emissions for CCUS in WA and required processing
WA is home to 69 of the 215 Australian facilities registered under
the safeguard mechanism—meaning that those facilities must
manage any emissions above their baseline.
The study modelled two example hubs located around major
emissions source clusters in WA: the Pilbara and Perth–Kwinana.
Enablers/accelerators
1. Support research and development of 2. Fiscal incentives to kick-start CCUS development Investment in CCUS technology now
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capture technologies to drive down prices as is happening elsewhere in the world
will provide both direct and indirect
emissions abatement.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Infrastructure
Current infrastructure Economies of scale and wider emissions reduction Infrastructure investment required
WA already has significant infrastructure supporting high The hubs model not only provides the economies Notwithstanding the existing infrastructure, there is
emitting industries that could be repurposed for CCUS. of scale in development but also makes the CCUS still a considerable amount of investment needed to
In addition this infrastructure is geographically located process viable for smaller operations and facilities for realise CCUS at a competitive price and in particular
adjacent to WA’s significant storage capacity. whom the technology would otherwise be out of reach. in the capture of CO2 from low concentration
streams.
Repurposing infrastructure offers substantial cost The concentration of this infrastructure within
savings for competitive CO2 abatement. The study does CCUS hubs would attract industries for whom CCUS Attracting investment is more difficult in the
not specifically explore costs associated with repurposing provides options for decarbonising, and for future absence of any clear price signals. Furthermore the
infrastructure, however the IEA estimates that repurposing ventures and technologies that require concentrated 7–10 year lead time required to set up CCUS means
pipelines could be as low as 1–10% of the cost of creating CO2. These include industries such as fertiliser that waiting for a clear price signal would mean that
new. There are further benefits to the environment from manufacture, carbon black and mineral carbonation. the operation would not achieve its potential within
extending the utility shelf life, with deferred or reduced the target timeframe.
decomissioning.
Enablers/accelerators
1. Business model and 2. Appropriate fiscal 3. Align and streamline 4. London Protocol adoption Investment in CCUS technology now
governance framework incentive model to federal and state and framing of WA’s
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will provide both direct and indirect
for shared infrastructure encourage immediate approvals processes opportunity in CO2
investment for developments shipping emissions abatement.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Skilled and experienced workforce
Powering WA employment WA employment rates by sector
There are 120,000 people directly employed in
WA’s resource sector.
It is a workforce with skills that are applicable
and transferrable to CCUS thus creating a
fair transition for these workers to a lower
emissions economy within WA.
Enablers/accelerators
1. Development of a CCS knowledge hub to 2. Strategic land planning to promote opportunities Protecting 120,000 jobs and creating
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share expertise and technologies for other indsutries requiring CO2 or CO2 storage
37,000 jobs in construction with a net
to migrate to CCUS hubs
gain of 500 permanent jobs.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Co-location of hydrogen production
A pathway to renewable hydrogen Hydrogen generation
Renewable (or green) hydrogen is considered
important to a future carbon neutral economy.
Renewable hydrogen is produced by passing a
current generated by renewable energy through
water. It is currently limited by the maturation
timeline of the technologies and processes
involved.
Low emission hydrogen is produced from natural
gas and water with the high concentration pre-
combustion streams of CO 2 immediately captured
and stored.
In contrast to renewable hydrogen production,
the technologies and processes required for low
emission hydrogen production are already mature
and can enable the early development of supply
chains and infrastructure critical to the transition
to green hydrogen.
Enablers/accelerators
1. Accelerate the development of low 2. Strategic land planning/common use Facilitating low emission hydrogen
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emission hydrogen supporting the infrastructure to allow industries to as a transition to a renewable
hydrogen strategy to WA locate close to potential CCUS hubs hydrogen future.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Economy
The resources industry currently contributes Contribution to the WA economy
$170 billion (47%) to the WA economy. The top three
emitting industries are LNG, aluminium refining and
power generation. CCUS hubs protect that economic
contribution by providing abatement options and a
transition pathway to a low emissions economy.
Enablers/accelerators
1. Create a 2. Incentives for rapid investment 3. Embrace CO2 4. Enable the import of CO2 to Protecting the $170 billion contribution
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bankable to strengthen the lifecycle shipping to develop help fund and acelerate the from the resources sector to the WA
value for CO2 return to the economy transboundary markets development of CCUS hubs economy and boosting it by $55 billion.
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
Making WA a global CCUS hub
The study shows a CCUS Policy Regulatory regime Fiscal incentives
hub concept that is not only Additional policy support is essential to ensuring The Commonwealth Offshore Petroleum and The ultimate goal of government support is
technically viable, but able that Australian industry can grow and thrive in Greenhouse Gas Storage Act 2006 includes CCS- to create the incentive for investment in CCUS
to deliver significant benefits a world economy that is increasingly realigning specific legislation with a familiar approach to now rather than to wait until the CO2 price signal
to WA through emissions towards a net-zero future. Ineffective policies offshore operations and covers the entire project is sufficiently clear to make the investment
reductions, jobs, boosts function as barriers to investment in CCUS. lifecycle. Whilst some provisions within it are independently. This is particularly necessary
to state GDP and fostering yet to be tested it provides a basis for a more given the lead time of up to 10 years to complete
A policy framework might include:
international partnerships comprehensive regime which could: a CCUS project.
and social license to operate. • recognising CCUS as a component of the climate
• establish formal dialogue between WA and Globally there are a range of fiscal incentive models
change portfolio and prioritising CCUS hubs
However, like all CCUS hubs Commonwealth regulators to identify overlapping in operation. These provide insight into what might
• coordinating CCUS development through state– permitting responsibilities and propose necessary work best in the Western Australian context.
globally, WA hubs would need
federal–private partnership amendments to streamline permitting
the right business model,
appropriate governance, • facilitating and investing in CO2 transport and • implement WA’s proposed CCS-specific legislation Sharing knowledge, lessons,
government–industry storage infrastructure and developing supporting regulations relating to successes, and technologies
collaboration and • supporting the exploration and appraisal permitting and approval of titles and activites Leverage WA’s extensive expertise and
supportive regulatory/ of prospective storage resources • resolve any inconsistencies between technologies to support further development of
policy frameworks. • providing access to low-cost capital Commonwealth and state legislation the CCS industry and developing a CCS knowledge
for CCUS projects hub would provide an opportunity to expedite
• address any provisions in wider legislation that
R E G U L AT knowledge growth and accelerate the CCUS project
• establishing a value inadvertently present barriers to CCUS projects
A ND O development necessary to the decarbonisation of
on CO2 storage. • synthesise the approvals pathway through
S
RY
B
POLIC
GE HU
AM
EWORKS
projects CCUS hub governance model
LED
Ø
In order to realise the significant economies of
to the London Protocol towards transboundary
W
FISCA EL AND K transportation of CO2 for geological storage, operation of a CCUS hub, an appropriate business
L
I OD identify key legal instruments and ensure
M model is essential. The business model design
NC
frameworks
• corporate structure (e.g. joint venture,
IVES
• work towards certainty and clarity of liabilities proprietory limited company, incorporated/
within CCUS projects unincorporated etc.)
• develop guidelines for developers relating to
• governance principles
titles, permitting, approvals and compliance
with new legislative requirements including • purpose (e.g. scope, boundaries, objectives
for transboundary movement of CO2. and how it will generate revenue/profit).
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
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Findings
Policy Regulatory Fiscal Knowledge sharing and skills
1. Recognition of CCUS 1. Develop WA regulatory 1. Develop a fiscal 1. Acknowledge the role
in climate policy and as framework to support incentive model of CCUS in the fair
a part of WA’s emissions CCS project development through government– transition of WA’s
abatement portfolio including a regime to establish industry engagement workforce to a low
rights-of-way to CCUS hubs and consideration of emission future
2. Support the exploration and global best practice
appraisal of prospective 2. Align state and federal 2. Develop a CCUS
storage resources frameworks to streamline knowledge hub to
approvals and permitting position WA as a
3. Establish state–federal– global authority
industry partnership to 3. Assess wider legislation
coordinate CCUS implications and address 3. Support the research
developments any measures that and development into
inadvertently present capture technologies to
4. Establish policy settings barriers to projects drive down prices
that give investment
certainty in the 4. Establish transboundary
long term shipping/transportation
agreements to open
up international
opportunities
5. Develop a long-term
liability regime for CO2
storage and transport
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE
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Study partners Glossary Data sources
CSIRO Commonwealth Scientific and Industrial Research CCS carbon capture and storage is a process where CO2 is GENERAL
Organisation—CSIRO undertook the WA CCUS captured—generally from industrial sources—compressed,
Geoscience Australia—an
Hubs Study in partnership with GCCSI on behalf then injected into deep geological formations such as depleted
Australian Government agency that
of the WA LNG Jobs Taskforce. oil and gas reservoirs or saline aquifers
carries out geoscientific research.
GCCSI Global CCS Institute—an international think tank CCUS carbon capture utilisation and storage includes where the The agency is the government’s
whose mission is to accelerate the deployment captured CO2 is diverted for use in other processes technical adviser on all aspects of
of carbon capture and storage (CCS), a vital geoscience, and custodian of the
technology to tackle climate change and deliver CO2 carbon dioxide geographic and geological data
climate neutrality. and knowledge of the nation and
CO2e carbon dioxide equivalent
provided the source data on WA’s
GDP gross domestic product CO2 storage potential
KEY FINDINGS FROM THE WA CCUS HUBS STUDY UNDERTAKEN BY CSIRO AND GCCSI FOR THE WA LNG JOBS TASKFORCE NOVEMBER 2023
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