NEWS & INSIGHTS | Opinion
EU CO2 storage targets for oil and gas sector
Luca Corradi
Luca works to bring “the outside in”, connecting innovators and academics across sectors and disciplines, to explore the latest technologies that could be adopted to address oil and gas industry challenges. Leading The Net Zero Technology Centre’s horizon scanning activity, he identifies emerging technology trends, cutting through the hype to identify potential areas of impact and application. With a background in business and organisational change leadership, Luca has developed a strong network and is passionate about harnessing this to deliver the next generation of the net zero energy industry.
Outside work Luca loves reading, music and travel. He is married with two young daughters and a dog. He enjoys the rare motorbike ride in Scotland and even rarer ski trip on the Alps.
More to net zero news: Energy Transition survey; UK and Germany hydrogen pipeline; European carbon storage
Chief Technology Officer at NZTC, Luca Corradi, and his team closely monitor the global net zero landscape. They follow the trends, policies, investments, and technological innovations that, together, bring the world closer to its shared climate goals. Learn more about our horizon scanning service. This week, Luca and his team look at results of the 41st Energy Transition survey, progress in the exploration of the feasibility of a hydrogen corridor between the UK and Germany and the CO2 storage obligations assigned to 44 oil and gas companies.
Aberdeen & Grampian Chamber of Commerce’s Energy Transition Survey tracks industry confidence and activity trends from 118 businesses across oil, gas and low-carbon energy
The 41st Energy Transition survey reveals that despite expectations for revenue growth improving slightly, the value of UKCS work continues to fall. Activities across renewables, electrification and decarbonisation remained flat, reinforcing the argument that an accelerated decline in oil and gas operations risks the broader energy transition.
For the first time in the report’s 20-year history UK policy is the top long-term concern for the sector, ahead of market fundamentals. In the year ahead, government policy and taxation remain the most important factors influencing the UKCS. Concerns around access to finance are low, meaning given the right conditions the sector has the means to invest.
There is a growing share of skills and capital moving overseas with firms anticipating the majority of their work will be overseas by 2030. Almost half report staff already leaving the UK for energy jobs abroad, driven by uncompetitive policy, weak domestic confidence, and a lack of viable projects. This threatens the UK’s ability to deliver net zero, and once the capability is gone, it will be extremely difficult to rebuild. Businesses need stable, predictable conditions to invest in the energy transition. Whilst 65% of energy businesses are looking to diversify, only 33%of their current operationsextend beyond traditional oil and gas activities. This figure is projected to reach just 50% by 2030 – far short of what is needed to meet our climate commitments. The proportion of activity focused on oil and gas has not changed significantly since 2022.
Source: Aberdeen & Grampian Chamber of Commerce
National Gas and GASCADE have signed a MoU to study the establishment of a hydrogen pipeline between the UK and Germany.
National Gas has signed a MoU with the German transmission system operator GASCADE, to explore the feasibility of establishing a hydrogen corridor between the UK and Germany through an offshore pipeline interconnection. The pipeline will start in either Teeside in England or St Fergus in Scotland and will be linked to GASCADE’s AquaDuctus pipeline project, which connects to the German mainland. The pipeline will be for a capacity of 20 GW and provide bi-directional transport capabilities.
The project builds on the high-level feasibility study carried out by Arup, Adelphi and Dena which focused on the regulatory, infrastructure and commercial aspects of the pipeline.
This is new concept is just one a number in development and highlights the growing traction for a hydrogen pipeline between the UK and the EU. NZTC’s Hydrogen Backbone Link (HBL) project has been exploring this opportunity aiming to establish a hydrogen pipeline between the UK and Europe. The HBL considers links to Shetland, Orkney, Cromarty, Western Isles, Ireland, Netherland, SE England, as well as Germany and has been running for 3 years supported by the Scottish Government and a diverse industry consortium.
Planned offshore hydrogen pipeline connection between the two countries
Source: GASCADE
The European Commission has assigned CO2 storage obligations to 44 oil and producers across the EU
The European Commission has announced a list of 44 oil and gas companies that are required to contribute to the EU’s target of 50Mt/year of CO2 injection capacity by 2030 under the Net-Zero Industry Act. The companies are required to use their oil and gas know-how to provide operational CO2 injection capacity into geological storage sites by 31 December 2030 for companies that capture CO2. It is hoped these projects will accelerate the development of Industrial Carbon Management solutions and play a key role in the decarbonisation of hard-to-abate industries across Europe.
The company’s contribution obligations are in proportion to their share of the EU’s crude oil and natural gas production from 2020 and 2023. The companies include Nederlandse Aardolie Matschappij B.V, OMV Petrom, Eni, Shell and TotalEnergies with contributions ranging from 160 to 6350 ktpa.
The regulation is subject to a two-month scrutiny period by the Parliament and Council. Following this period, and assuming no objection is made, the regulation is expected to enter into force at the end of July 2025.
Operational CO2 injection capacity contribution obligation by 2030
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