Shell quits major UK carbon capture project – but venture insists its future is safe
Shell has confirmed it has pulled out of one of the UK’s largest carbon capture and storage (CCS) projects just days after the National Grid walked away from the venture.
The project aims to develop infrastructure to transport some 20m tonnes of CO2 per year from industrial developments in the Humber region and store them under the seabed in the southern North Sea.
The project is run by the Northern Endurance Partnership (NEP) – a venture comprised of rival energy giant BP, Norwegian oil giant and Totalenergies – and aims to be up and running by 2030.
A spokesperson for Shell confirmed its decision to pull out of the partnership to City PM
Following a review of its strategy and portfolio, Shell said it would focus on another CCS project, called Acorn, in Scotland, adding that the decision has no bearing on other CCS projects it is working on.
The Shell spokesperson revealed, however, that National Grid’s decision to withdraw its ventures business (NGV) from the project earlier this week did influence its decision.
National Grid will no longer build 120km pipelines from Drax Power Station to the North Sea as part of a proposed CCS development.
A spokesperson for the National Grid said that NGV decided to exit to focus on the company’s existing UK portfolio, to connect renewables to the grid and focus on net zero.
NEP confirmed the firms’ decisions to leave the project, and said BP and Equinor have acquired the equity holdings of NGV and Shell. NGV is in ongoing commercial discussions with NEP partners about the sale of the Humber onshore pipeline proposals.
A spokesperson for the NEP insisted, however, that the project’s future was not in doubt as a result of the changes.
“Changes to the equity structure of businesses such as the NEP are not unusual, and NEP partners BP, Equinor and Totalenergies have unrivalled experience in successfully delivering ambitious and world changing projects,” a spokesperson for the NEP told City PM
The exit of both companies is also another blow for the power plants in the Humber region, which missed out on a fresh round of government support announced at the end of last month.