Energy firms to approach UK government to support carbon capture project

Shell and Scottish and Southern Energy (SSE) have announced plans of a joint carbon-capture and storage (CCS) project in the Scottish County of Aberdeenshire.

However, the pair also announced that the project is on hold until they can confirm the financial support of the UK government.

As part of the UK government’s plans to encourage the development of CCS it has earmarked £1 billion. Shell and SSE hope that their proposal to develop CCS at the Peterhead power station will gain adequate funding for the project to take shape.

The aim of CCS is to capture and liquefy CO2 emissions from power stations, which can then be transferred through a pipeline to diminishing oil and gas fields beyond the sea bed.

The regeneration process is being seen as vital to a future of generating power from coal and gas, whilst mitigating CO2 emissions at the same time.

Last month, a similar project in Scotland at Longannet in Fife was cancelled after Scottish Power, the operator of the coal-fired power station, declared the project would cost in the region of £1.5 billion. The UK government pulled the plug on the project after admitting that it was not willing to go above £1 billion in support.

If Shell and SSE are granted funding, the two firms said in a statement that they expect a full design study to be ready in the second half of 2012.

“If long-term targets for reducing emissions are to be met, CCS technology must be applied as widely as possible,” said SSE Chief Executive, Ian Marchant.

“We therefore welcomed the UK government's decision to include gas-fired generation plant in its CCS demonstration programme. However, the development of a commercial-scale CCS demonstration project presents significant challenges and will require appropriate levels of support from both the EU and UK government,” Marchant added.