UK’s first 21 carbon storage licences handed out by North Sea Transition Authority

FOURTEEN companies have been awarded 21 licences by the North Sea Transition Authority (NSTA) in the UK’s first ever carbon licensing round. The NSTA says the locations could store almost 10% of the nation’s total greenhouse gas (GHG) emissions.

Among the licence recipients are Shell, Perenco, and Eni, who were all awarded locations off the coast of Norfolk in sites that could form part of a potential Bacton Energy Hub. The NSTA says the hub could provide carbon storage, hydrogen, and offshore wind, offering low carbon energy to London and the Southeast for decades and helping the drive to net zero GHG emissions.

The licences are for depleted oil and gas reservoirs and saline aquifers covering around 12,000 km², with additional sites including locations off the coasts of Aberdeen, Teesside, and Liverpool expected to expand carbon dioxide storage capabilities to 30m t/y by 2030. The UK’s annual emissions were 339.5m t/y in 2021.

Other winners include ExxonMobil’s Esso, through partnerships with Shell and Neptune Energy for projects “in waters where ExxonMobil has developed oil and gas reserves for decades”, the company notes. Licences were also awarded to Pale Blue Dot, which is developing the Acorn CCS project that will transport and store emissions captured from industrial, power, and hydrogen businesses in Scotland.

Ruth Herbert, CEO of the Carbon Capture Storage Association (CCSA), welcomed the acceptance of the licences, which she said mark “a substantial milestone towards widespread deployment of CCS”.

She added: “With the potential to store almost 10% of the UK's greenhouse gas emissions in these new locations, starting to develop these sites paves the way for a cleaner and more sustainable future. The next step is a carbon capture deployment plan to enable us to fully exploit our future CO2 storage capacity.”

Stuart Payne, chief executive of the NSTA, underlined the critical role carbon capture will play in the energy transition as well as in hydrogen production and energy hubs. He said NSTA teams would support licensees to achieve first injection of carbon dioxide “as soon as possible”, and that the organisation would continue working with industry and government to enable further licensing activity to back net zero.

Lord Callanan, government minister for energy efficiency and green finance, said: “The UK has one of the largest potential carbon dioxide storage capacities in Europe, putting us in prime position to be world leaders in carbon capture – which is why we’ve committed an unprecedented £20 billion to develop the early-stage development of carbon capture, usage and storage (CCUS).

“These new licences…will be vital to realising our CCUS potential, playing a key role in the energy transition to help boost our energy security and achieve our net zero targets, while also bringing in private investment and supporting thousands of jobs.”

More licences to come

The awarded licences are in addition to six previously granted by the UK government. The NSTA says it’s estimated that as many as 100 will be needed to meet the requirements for achieving net zero. It adds that the volume of applications received for the first licencing round demonstrates the industry’s desire for further opportunities.

The NSTA will assess the response and quality of opportunities in locations across the UK before deciding when to run a second round.

The UK’s other CCUS efforts include plans to deploy four clusters, including HyNet in Northwest England and the East Coast Cluster in Teesside and the Humber, selected for development by the mid-2020s (Track 1). Selected for Track-2 development in recent months, Acorn in Northeast Scotland and Viking in the Humber are set to be operational by 2030.