CSLF Policy Group Meeting Abu Dhabi, United Arab Emirates 4 th May 2017 Summary of CCUS Workshop in Bahrain, February 2017 Deployment of Carbon Capture Use and Storage in the Arab Region Ms. Radia Sedaoui Chief Energy Section Sustainable Development Policies Division
Reconciling the tight emissions pathway with Sustainable Development aspirations Global energy-related CO2 emissions *: Others include large-scale biomass burning, post-burn decay, peat decay, indirect N2O emissions from non-agricultural emissions of NOx and NH3, Waste, and Solvent Use. Data Source: WRI 2015, IEA 2014, source: IEA WEO2016 15,000 GT CO2 that are still in the ground from fossil fuels have to remain there. Page 2
Reserves Abundance in the Arab Region OIL PROVED RESERVES AT END 2015 Rest of the World, 58% 1,697.6 Billion barrels Arab Region, 42% GAS PROVED RESERVES AT END 2015 Arab, 29% 187 TCM Rest of the World,71% Countries Page in 3 the Arab region exhibit different energy consumption levels,..but they share their reliance on fossil fuels for energy sufficiency. Source: OAPEC, BP statistical Review, 2016
Share of Arab countries in total Carbon emission Copyrights: Carboun 2017 Historically low rate of energy use and carbon emissions: Arab region constitutes 5% of the world s population Emits just under 5% of global carbon emissions Regional discourse has emerged to address the region s water scarcity, rapid urbanization, environmental degradation and the expected impact of global climate change and sea level rise Copyright 2016 ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without a written permission
Arab region includes some of the most water scarce countries in the world 2013 Page 5 Copyright 2016 ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without a written permission
Objective: Explore the challenges and the opportunities for wide-scale deployment of CCUS and examine the side effects of this technology for the Arab region in the context of international and regional environmental law and economic context. Copyright ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without written permission
Participants: Inaugurated by His Excellency Sh. Mohammed bin Khalifa bin Ahmed Al-Khalifa, Bahrain s Minister of Oil Organised by the UN-ESCWA Participants/Experts: High level Representation from Ministry Foreign Affairs, Government Agencies and Research institutions. Experts from : Arab Group Climate Change Negotiators, Al Reyadah, GCCSI, GCF, Masdar Institute, KAPSARC, Saudi Aramco, Gulf Petrochemical Industries Co. Bahrain,.. Copyright ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without written permission
Main topics addressed at Manama CCUS Workshop CCUS GLOBAL Perspective and role for climate response Global Status of CCS Development CCS and the Context of Paris Agreement Green Climate Fund & Opportunities for financing CCUS Projects Accelerating CCUS deployment- Challenges and Opportunities CCUS Technology Road Map Using CO 2 -EOR to reduce CO 2 emissions - Assessing the Opportunity New CO 2 Utilization in the Oil and Gas Sector Obtaining Value from CO2: economic perspective and Experience from GCC Countries CCUS in GCC: Economic, Institutional Drivers & Potential Development Paths Post COP22 CCUS R&D Status and Potential for CCUS, Projects & future opportunities in the UAE UAE Al Reyadah Project Saudi Arabia s Efforts in Carbon Management Middle East s First Dioxide Recovery (CDR) Plant Copyright ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without written permission CCUS as Platform for Arab regional collaboration
Elements of CO2 Management Technology Society CO 2 Management Economy Policy Copyright ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without written permission
CCS is critical in a portfolio of low-carbon technologies Copyright ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without written permission
IPCC Special Report on CCS: A major milestone in CC negotiation amidst fluctuating policy support 1995 2005 2005 2011: 2014 2018 Removal and storage of CO2 from fossil fuel power-stations. Costs, environmental effects and efficacy of such options remain largely unknown. IPCC Special Report on CCS Eligibility for CCS projects under KP CDM : Ad-hoc Working Group on Durban Platform pre2020 (WS2) Technical Expert Meeting CCS is critical to achieve more ambitious climate targets. Without CCS, the cost of achieving atmospheric concentrations in the range of 430-480 ppm CO 2 -eq would be 138% higher. Copyright ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without written permission IPCC will deliver a special report on the impacts of global warming of 1.5 C above pre-industrial levels and related GHG pathways. Strong expectation that CCS, will be a feature of the 2018 IPCC report.
Intended Nationally Determined Contribution (INDC) Inclusion of CCUS as mitigation measure INDCs proposed before COP21; CCS accepted as part of future CDM during COP22. CCS in INDCs: Bahrain, Brazil, Egypt, France, Malawi, Canada, China, Iran, Norway, Saudi Arabia, South Africa, UAE, USA. Other countries, including China, Australia and Japan did not specifically mention CCS in their pledges, however they have demonstrated significant commitments to developing CCS. Country CCS CO 2 -EOR Bahrain X Kuwait Oman X Qatar Saudi Arabia X X UAE X Bahrain, Qatar, Saudi Arabia, and UAE emphasized Decision 24/CP.18 Economic diversification with mitigation co-benefits as central pillar of climate action and emphasized financial, technology transfer and capacity building. Copyright ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without written permission
Opportunities for CO2 storage via EOR are substantial IEA estimates ranges from 50% to more than three times the amount of total CO2 storage required under the IEA 2DS scenario through 2050. Advanced EOR could potentially produce up to 375 billion barrels.
The CCUS technology is proven in many applications. The portfolio of operating projects has grown and diversified 18 16 14 Large-scale CCS facilities by region or country January 2017 1 12 10 8 6 4 2 3 2 5 1 1 3 1 0 4 2 0 11 The availability of CCS in the future depends on investment today. An expanded project pipeline is needed to allow for more new projects to become operational in 2020 and beyond 0 1 1 Early Planning Advanced Planning Construction Operation North America China Europe GCC Rest of the world Copyright 2014 ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without a written permission
Private and public and investment in large-scale CCS projects Copyright 2014 ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without a written permission
CCUS can be beneficiary for Arab s economy diversification strategy if carefully structured and adequate policy is in place Arab countries are at an early stage of CCS deployment & currently driven primarily with internal rationale versus external incentives Algeria: the world s first project closure study opportunity for CO2 Storage and monitoring Saudi Arabia is home to the region s first operational large-scale CO2-EOR project The UAE hosts the world s first CCS project in the iron and steel sector The focus of CCS activity in the region is two-fold: validate large-scale projects under local conditions support for R&D activities Confidence from these programs is a key driver for longer-term deployment Copyright 2014 ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without a written permission
Industry and governments should explore novel ways of financing CCS projects Risk allocation Technology Commercial structure Capital structure Most projects have been financed with a combination of grant funding, various forms of incentive payments and shareholder equity. Copyright 2014 ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without a written permission
CCUS and Green Climate Fund (GCF) Structure and policies Resources Availability Can accommodate funding CCUS, if progress was made to prove its feasibility and demystify its potential to contribute to global efforts. It would be a favorable investment given its return on investment and private sector potential. Decision making Challenging as it is based on consensus and is heavily opinionated Copyright 2014 ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without a written permission
Maintaining and increasing CCUS competitiveness is a long term goal Policy and political support over time are required Charting a policy path to wide deployment of CCS in industrial applications Low Cost Opportunities: Long Term Policy Early Deployment Wide Deployment Today Evolving long-term market policy Strategic Actions to Advance CCS in all Sectors Including CO2 Transport and Storage. 2030 Collaborative technology development Evolving long-term market Policy Key Deep Emission Cuts Pilot Demonstration Deployment Continued delivery of next-generation technologies Copyright ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without written permission
The challenges facing CCUS are well known and must now be addressed with a renewed sense of urgency if global climate goals are to be met Developing Long-term clear commitment technological and stability roadmaps in for policy each frameworks technology in are local critical applications. to create Advancing a sustainable domestic R&D market capacity and achieve for local aspirations CCUS development of CC mitigation Targeted financial incentives for investment are indispensable. New approaches of thinking and business models are important for accelerating CCUS deployment to achieve the ambitions of the Paris Agreement Governments should identify opportunities where policies and local and commercial interests align to encourage CCS deployment, and introduce measures targeted at creating new and strengthening existing markets for clean products with a low CO2 content Close collaboration to be enhanced between Governments and the industry to ensure that final investment decisions are taken on as many as possible of the projects in development and moving through construction to build experience and foster growth in the industry. Increase and expand international and regional CCUS co-operation across Research and sharing data for best practices are important for accelerating the future pace of CCUS deployment. Copyright 2014 ESCWA. All rights reserved. No part of this presentation in all its property may be used or reproduced in any form without a written permission
Economic and Social Commission for Western Asia THANK YOU sedaoui@un.org