CO₂-EOR in the UK: Analysis of fiscal incentives
Carbon capture and storage (CCS) is a technology that could reduce CO2 emissions to atmosphere from power and/or industrial sources. CCS could provide up to 20% of global CO2 emissions reduction required in 2050, potentially halving the costs of meeting climate targets both in the UK and internationally1. Several planned, and at least one operational, CCS projects in North America use captured CO2 for enhanced oil recovery (EOR). The revenues from CO2-EOR reduce the costs of CCS, create wealth, and support employment. A recent techno-economic evaluation by Element Energy et al. for Scottish Enterprise identified several oilfields in the UK sector of the North Sea for which CO2-EOR could provide permanent CO2 storage capacity for CCS projects, and yield positive (i.e. favourable) net present value (NPV) from oil revenues under a wide range of plausible conditions2. The economic impact for Scotland alone from the highest CO2-EOR scenarios would be £2.7 billion in gross value added (GVA), generating hundreds of additional jobs in Scotland3.