(Bloomberg) -- A Danish project to store captured CO2 in North Sea reservoirs that were once filled with oil and gas moved a step closer to becoming operational, after winning approval from new stakeholders.
Twenty-nine companies, research institutes and universities agreed to support the next testing phase of the Greensand project, according to a statement on Tuesday. The backing came after initial work by the project's original four members, including Maersk Drilling A/S and INEOS Energy, showed the location is physically robust enough to store emissions safely.
Denmark has some of Europe's toughest targets for cutting emissions, with a goal to reduce its carbon footprint by 70% before 2030, compared with the level in 1990. The area encompassed by the Greensand project is large enough to fully meet Denmark's target for removing CO2 from the atmosphere through carbon capture, according to the coalition of stakeholders.
The Danish government wants the Nordic country, which fostered the global wind turbine industry through early subsidies, to become a linchpin in green technology. With carbon prices set to climb, the market for tools that capture and bury emissions could reach $2 trillion if used to cut pollution from heavy industry, according to Credit Suisse.
Cost to Bury Carbon Near Tipping Point as Emissions Price Soars
Carbon-capture projects like the one being explored in Denmark mean fossil-fuel infrastructure that has so far fanned global warming now offers a potential solution.
Oil production at the Danish site will stop “in the next couple of years,” said Mads Weng Gade, commercial director at INEOS. And after years of extraction, “now we are actually just reversing” the process, he said.
Greensand coalition members will now file a grant application with Denmark's energy demonstration program to help fund the next stage, which may cost upwards of $80 million. If that's approved, work could begin later this year on testing at the site, to see whether the idea works. If it proves a success, the coalition will seek to raise funding to build a commercial-sized facility, Gade said.
“There is huge interest in the capital markets in these projects,” he said.
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