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Carbon-Capture Plans Must Be Hastened to Meet Goals, Otter Says

Bloomberg.com 

By Angela Macdonald-Smith

April 7 (Bloomberg) — Carbon-capture and storage needs to be developed more rapidly and on a larger scale to have any chance of meeting greenhouse-gas reduction goals, said Nick Otter, head of a world body aimed at hastening the technology.

Relying on market forces would mean commercial plants being built only after 2030, too late to meet 2050 targets for emissions reductions, Otter, chief executive officer of the Australia-sponsored Global Carbon Capture & Storage Institute, said in Sydney. Each plant may cost as much as 1 billion euros ($1.3 billion), he said.

Greenhouse gases must peak in 2015 and drop by 50 percent by 2050 to avert the worst effects of climate change, the United Nations said in a 2007 report. Royal Dutch Shell Plc, Europe’s biggest oil company, estimates that carbon-capture and storage technology, known as CCS, could cut global carbon dioxide emissions by more than a third by 2050.

“If we don’t accelerate this progress we won’t meet the targets for CO2,” Otter said at a seminar late yesterday. “There is no time to do it at the pace the market would like to do it at.”

CCS technology involves extracting carbon dioxide from power generation and industrial projects, compressing it and injecting it into depleted oil and gas fields or saline aquifers. It would allow prolonged use of coal for electricity generation while reducing greenhouse pollution.

While carbon is already being stored in projects such as StatoilHydro ASA’s Sleipner venture in the Norwegian North Sea at rates of as much as 1 million metric tons a year, the world needs “about 600 Sleipners a year for the next decade” to help meet emissions reductions targets, Otter said.

20 Projects

Australia’s Prime Minister Kevin Ruddannounced the formation of the institute in September, pledging finance of as much as A$100 million ($71 million) a year. The Canberra-based body, which has a mandate to facilitate the development of more than 20 commercial-scale CCS demonstration projects by 2020, now has 80 foundation company and country members, up from the 12 that signed up at an initial workshop in London in November, Otter said.

Xstrata Plc, the world’s biggest exporter of power-station coal, Rio Tinto Group, Anglo American Plc and Mitsubishi Corp. were among the initial members, Australian Energy and Resources Minister Martin Ferguson said Nov. 26.

Otter yesterday declined to identify the newest members before Rudd formally inaugurates the institute. The aim is to convert the institute, currently under Australia’s Department of Resources, Energy and Tourism, into a non-profit company owned by its members by July 1, he said.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at[email protected]

Last Updated: April 6, 2009 22:41 EDT 

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