MUSAT: The Ministry of Energy and Minerals signed here on November 8, 2023, a Terms of Reference agreement with multiple oil and gas industry stakeholders to establish a regulatory framework for blue hydrogen and carbon capture utilisation policies in the Sultanate of Oman.
Speaking at the signing, Mohsin bin Hamed al Hadhrami, Under-Secretary of the Ministry of Energy and Minerals, emphasised the importance of CCUS (Carbon Capture, Utalisation and Storage) in achieving Oman’s net zero goals.
"[Based on the Net Zero 2050 report,] we expect to reduce emissions from the 2021 baseline by 6% in 2030 and by 54% in 2040. To achieve our 2050 net-zero target, we have no choice but to tap into a diverse portfolio of technologies. Today, we are taking steps to utilise CCUS as the method by which we are going to address various industries.”
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According to Al Hadhrami, Oman is expected to abate 16.3 million tons of CO2 annually via CCUS by 2050. CCUS will play an integral part in decarbonizing the country’s highest emission producing industries, which includes the industrial and Oil & Gas sectors, which account for one-third and one-quarter of emissions respectively, and require multiple methods of decarbonization.
This includes the adoption of electrification, and the use of low-carbon hydrogen and renewables and CCUS for the industrial sector, as well as the adoption of electrification and CCUS and efficiency improvements for the gas and oil sector.
As a result, he explained that the power sector will need to expand to meet the decarbonising demands of these sectors.
"Regarding the power sector, responsible for one-fifth of emissions, it needs to meet the electrification needs of other sectors. This means the power generation sector has to expand. Without effective measures, this could result in a 4.5-fold increase in emissions from current levels,” he said.
“To prevent this, we need to introduce methods for decarbonizing power generation, including renewables like solar PV and onshore wind generation. Incorporating intermittent renewables into what was once a stable electricity production system necessitates maintaining a base load through natural gas generation, which, in turn, must undergo decarbonization with CCUS. We understand that achieving Oman's 2050 net-zero goal without CCUS is not viable."
Al Hadhrami also stressed the importance of establishing a collaborative national CCUS framework.
“It is crucial to approach this in a structured and effective manner, collectively as an industry, within a national framework, rather than through individual projects. CCUS involves multiple players who need to collaborate, and the framework is necessary to facilitate this cooperation."
He further added: “It is important to take accelerated efforts in utilizing the elements of a clean economy, by employing functional solutions and collaborating with our partners in the sector to achieve the targeted results within the designated time-frame, through applying the best practices and advanced technical solutions in the field of carbon management in a systematic sustainable manner.”
The terms of reference (TOR) agreement was signed between the Ministry of Energy and Minerals and a team consisting of Petroleum Development Oman (PDO), Oman Shell, OQGN, and Occidental Oman.
The TOR will additionally entail the formation of a “House of Expertise” consisting of the Ministry of Energy and Minerals, key CCUS and blue hydrogen industry partners, public and private stakeholders, and academic institutions to develop the regulatory framework of the sector, according to Ministry officials.
In a released statement, Director General of Renewable Energy and Hydrogen at the Ministry of Energy and Minerals, Dr Firas bin Ali al Abduwani, shared that the “House of Expertise” will conduct a study to assess the current landscape of CCUS and Blue Hydrogen.
"The study to be carried out by the House of Expert in the field of carbon capture and production of blue hydrogen will contribute to complementing the ongoing efforts by the public and private sectors to reduce carbon emissions. This will involve conducting a comprehensive techno-economic and legislative assessment with the aim of shaping the future legal framework and establishing appropriate regulations to facilitate investments in this field, consistent with Oman's ambition to achieve Net zero.”
According to his presentation, the project is expected to develop an integrated CCUS policy and regulatory framework, conduct a techno-economic assessment of CCUS and Blue Hydrogen in Oman, create transparent licensing processes throughout the value chain, asses financial mechanisms required to facilitate private sector investments, identify regulatory challenges to CCUS and Blue Hydrogen projects and explore regional and global opportunities.
Furthermore, he added that the project will aim to explore carbon dioxide as a resource rather than waste, in efforts of establishing a circular economy.
The event also witnessed the signing of an MOU between Occidental Oman and OQ Gas Networks, for a joint study on carbon capture, utilisation, and sequestration (CCUS) projects in Oman.
According to OQGN Managing Director Mansoor al Abdali, the MOU is expected to address the entirety of the CCUS value chain.
He shared that CO2 will be captured at specific sites, and then transported through OQGN to Oxy operated sites, where it will be injected below the surface to enhance oil and gas recovery. According to Al Abdali some of the CO2 will be stored permanently underground.
President and General Manager of Oxy Oman, Steven Lauver, added, “We believe CCUS has the potential to unlock further development of the hydrocarbon industry while reducing greenhouse gas emissions. We are also excited to be part of the CCUS and Blue Hydrogen Policy & Regulatory Framework Terms of Reference where CO2 extraction technologies such as Direct Air Capture (DAC) can be studied in conjunction with initiatives of other stakeholders.”
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