PLUS: Bloomberg piece on CCS, Mitsui-Oman LNG, bp buys $100mm of Tesla chargers, Li-Cycle cancels battery recycling plant, Grey Rock's CarbonCycle commitment
Carbon capture and storage (CCS) technology has consistently received optimistic appraisals but has seen little progress.
The International Energy Agency (IEA) predicts global CCS capacity to reach 400 million tons by 2030 if all announced projects are built, up from the 2020 forecast of 350 million tons by 2030.
However, actual expansion of CCS has been negligible over the past three years, with existing capacity remaining at about 40 million tons.
The delayed growth in CCS is concerning given its potential role in achieving climate goals outlined in the Paris Agreement.
CCS technology involves separating CO2 from gases, collecting emissions from smokestacks, and burying CO2 underground, but its deployment has been hindered by economic challenges.
An investigation reveals that a large carbon capture plant in Texas, built by Occidental Petroleum Corp., never operated at more than one-third capacity due to economic factors tied to natural gas prices.
The passing of the Inflation Reduction Act in the U.S., which provides incentives for CCS projects, has led to more optimism about CCS, but some experts remain skeptical.
CCS is seen as a costly and disruptive technology, and experts suggest deploying it selectively in industries without alternatives for decarbonization.
The U.S. government is supporting CCS demonstration plants to prove the technology's viability, but there is a risk of choosing the wrong projects.
Concerns persist about CCS being used as an excuse for continued investment in fossil fuels.
Despite these challenges, there is an expectation at the COP28 climate summit that the global oil industry will be encouraged to further invest in CCS.
Grey Rock Investment Partners forms partnership with CarbonCycle, LLC.
Grey Rock will make a controlling investment of up to $100 million in CarbonCycle.
CarbonCycle plans to use the investment to develop Carbon Capture and Sequestration (CCS) projects, primarily focusing on natural gas processing facilities and industrial emitters.
CarbonCycle's leadership team has over 100 years of energy, engineering, and geological experience.
Grey Rock sees an opportunity to mitigate carbon emissions from over 450 natural gas processing facilities in the US emitting 56 million metric tonnes of CO2 annually.
CarbonCycle is led by CEO Rich DiMichele and Kent Bowker, EVP of Subsurface, both with extensive industry experience.
Grey Rock has an in-house team with expertise in energy development to support CarbonCycle.
CCS captures and converts CO2 emissions from industrial sources into a liquid form, reducing carbon footprints and combating climate change.
Mitsui & Co., Ltd. has agreed to extend its interests in the Oman LNG project.
Mitsui has a 2.77% stake in Oman LNG (OLNG) and indirectly invests in Qalhat LNG (QLNG) via OLNG.
The Omani government also signed a gas supply agreement with OLNG to provide natural gas (feed gas) until 2034.
Shareholders of OLNG and QLNG include Oman Investment Authority, Shell, TotalEnergies, Korea LNG, Mitsui, Mitsubishi Corporation, PTTEP, and ITOCHU Corporation.
Mitsui's involvement in the project aligns with its commitment to ensuring a secure and sustainable supply of essential products.
The extension of the project aims to contribute to a stable supply of sustainable energy, strengthen ties with the Omani government, and promote business development in Oman.
Shell plans to cut 15% of its low-carbon solutions division's workforce.
This involves cutting 200 jobs in 2024, with 130 more positions under review.
The move is part of CEO Wael Sawan's strategy to boost profits, focusing on higher-margin projects, steady oil output, and growing natural gas production.
Shell aims to transform its Low Carbon Solutions (LCS) business to strengthen its core low-carbon areas like transport and industry.
The job cuts will be integrated into other parts of Shell, a company with over 90,000 employees and do not affect the renewable power business but primarily target the hydrogen business within LCS.
It will scale back hydrogen light mobility and focus on heavy mobility and industry.
The decision to retreat from light mobility follows the departure of the business's manager, Oliver Bishop, who now leads BP's global hydrogen mobility business.
Shell's hydrogen-fueled car initiatives have scaled back as consumers increasingly choose electric vehicles.
Shell continues to invest in hydrogen, with projects like a 200 MW electrolyser plant in the Netherlands.
CEO Wael Sawan reiterates Shell's commitment to becoming a net-zero carbon emitting company by 2050 despite internal pressure.
Shell's focus on profitability comes in response to investor concerns about future returns as they reduce oil and gas production, while US rivals Exxon Mobil and Chevron double down on fossil fuel production.
bp's EV charging business, bp pulse, will acquire Tesla's ultra-fast charging hardware units for $100 million to expand its public charging network in the US.
The rollout is scheduled to begin in 2024, with Tesla chargers installed at key bp, Amoco, ampm, Thorntons-branded sites, TravelCenters of America locations, bp pulse's Gigahub™ charging sites near airports, and major metropolitan areas.
These chargers will also be deployed at select bp pulse fleet customer depots, allowing bp pulse to oversee the entire charging process for EV fleets.
Tesla's chargers have an output of 250 kW and will be compatible with North American Charging Standard (NACS) and Combined Charging System (CCS) connectors, making them accessible to a wide range of EVs.
This investment aligns with bp's plans to invest up to $1 billion in EV charging across the US by 2030.
bp pulse has already installed over 27,000 charge points and aims to deploy over 100,000 globally by 2030.
bp's commitment to EV infrastructure growth is supported by grants from programs like National Electric Vehicle Infrastructure (NEVI) and California Energy Commission (CEC).
In February 2023, bp announced its intention to invest $1 billion in America's EV charging infrastructure by 2030, with $500 million planned for the next two to three years.
Eavor Technologies Inc. has successfully completed a $182 million financing round to advance its geothermal technology.
The equity round was led by OMV AG and included participation from Canada Growth Fund, Japan Energy Fund, Monaco Asset Management, and Microsoft's Climate Innovation Fund.
Existing investors BDC, bp Ventures, Eversource Energy, Temasek, and Vickers Venture Partners also contributed, and Chubu Electric Power Co., Inc. converted their debentures.
Eavor's patented Eavor-Loop™ technology is a closed-loop system that harnesses the Earth's natural heat by circulating a benign working fluid through underground passages, providing consistent and resilient clean energy.
This technology makes geothermal energy accessible, scalable, and cost-effective with a smaller environmental footprint compared to traditional systems.
Eavor is advancing its first full-scale project in Geretsried, Germany, with the goal of deploying Eavor-Loop™ systems worldwide to promote sustainable and reliable clean energy.
Canada Growth Fund recognizes Eavor's potential to accelerate global decarbonization efforts and supports the Alberta-based clean technology company.
Microsoft's Climate Innovation Fund is also partnering with Eavor to develop geothermal energy solutions that provide consistent and reliable clean energy sources.
Eden, a sustainable natural resource recovery company, has closed an oversubscribed $12 million seed funding round.
Including previous funding, Eden has raised a total of $21.3 million, which includes $9.2 million in non-dilutive grants.
The funds will be used to scale the deployment of its Electrical Reservoir Stimulation (ERS) technology in various applications, including geothermal, geologic hydrogen, geologic carbon storage, and sustainable mining.
TechEnergy Ventures and Helmerich & Payne, Inc. led the funding round, with participation from Grantham Foundation for the Protection of The Environment, Anglo American, Good Growth Capital, Mass Ventures, and Portfolia Green & Sustainability Fund.
Eden's ERS technology aims to enhance subsurface permeability, making it valuable for energy transition initiatives and reducing costs in areas like geothermal and geologic hydrogen production.
The technology also has applications in geologic carbon storage and low-impact mining, improving CO2 injectivity and mineral recovery.
ERS employs high-voltage electricity and advanced monitoring to increase rock permeability while controlling fracture networks.
This innovation is more environmentally friendly than traditional hydraulic-fracturing methods, reducing emissions, water consumption, and environmental hazards.
Eden has successfully tested its technology in Oman and plans additional pilot projects to validate its effectiveness across different geological conditions.
The funding will support the scaling of Eden's technology, contributing to energy transition initiatives by enabling controlled enhancement of subsurface permeability.
Li-Cycle Holdings Corp., backed by the Biden administration, has halted construction on a lithium-ion battery recycling plant in Rochester.
The decision is due to escalating construction costs exceeding prior estimates, and a strategic review, including scope and budget, is pending.
Li-Cycle is in discussions with the US Energy Department regarding a $375 million loan commitment to support the project.
The company is part of the effort to meet the rising demand for battery materials in the transition to electric vehicles, with the US government providing subsidies and incentives.
This setback highlights the challenges of establishing a domestic battery supply chain to compete with China's dominant position.
Li-Cycle's shares plummeted by as much as 49% in New York, closing down 46% for the day, marking its largest recorded drop.
The Biden administration had previously announced funding for Li-Cycle's US subsidiary to expand its battery recycling facility.
Congressional Republicans have expressed concerns over such loans, citing past failures like Solyndra, which received a loan guarantee during the Obama administration.
The US Energy Department clarified that the Li-Cycle loan is still in the conditional phase, with no funds disbursed yet.
IEA World Energy Outlook 2023 - Annual investment in fossil fuels and clean energy, 2015-2023
What'd ya think of today's email?
Full DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.