CCS and Enhanced Oil Recovery Could Generate £2.7billion for Scottish Economy
14 November 2012New report reveals potential for one billion extra barrels of oil.
Combining the storage of carbon and using it for enhanced oil recovery in some of Scotlandís key oil fields could generate up to an additional £2.7bn GVA for the economy, according to a new report.
The report also suggests that using CO2 to increase oil recovery rates from some fields could help to create and sustain many hundreds of oil and gas jobs.
The report, Economic impacts of CO2-enhanced oil recovery for Scotland, which has been developed for Scottish Enterprise, found that such positive economic impacts could be significantly increased if opportunities in the supply chain were effectively utilised.
It identifies 19 oil fields on the UK Continental Shelf (UKCS), with the technical potential for this type of project, which could lead to an additional one billion barrels of oil being recovered as well as helping to store significant volumes of CO2.
If fully exploited, it is estimated projects in these key oil fields could contribute 15 per cent of all UKCS oil production by 2030.
The reportís financial modelling also suggests that additional tax receipts generated by the additional extraction could be used to offset initial support for CCS, and help make this more competitive with other low carbon power generation technologies.
The report has been developed for Scottish Enterprise by Element Energy with Dundas Consulting and the Institute of Petroleum Engineering at Heriot Watt University.
It sets out a number of potential actions that could be considered to help support the development of CO2 Enhanced Oil Recovery.
Energy Minister Fergus Ewing said: "With more than half of the value of the North Sea's oil and gas reserves yet to be extracted, up to 24 billion recoverable barrels with a potential wholesale value of £1.5 trillion, oil and gas will remain an enormous economic resource for decades to come.
"Carbon capture and storage technology implemented on a commercial scale would drive a significant reduction in carbon emissions from fossil fuels, increasing our security of supply, and presenting enormous opportunities for Scotland.
"Maximising oil recovery will lead to huge gains for Scotland - recovering just one per cent more oil could lead to an increase of £22 billion in the total oil recovered. That is why the Scottish Oil and Gas strategy, developed by industry, the Scottish Government and Scottish Enterprise, explores further ways of maximising recovery.
"Oil and Gas are essential feed-stocks for much more than just energy - we know chemicals, plastics, pharmaceuticals and fertilisers are all oil derived products - and this report, which looks at ways of increasing the amount of oil recovered, while at the same time locking away carbon dioxide, shows how innovation in the oil and gas sector can continue to create jobs and growth for years to come.Ē
David Rennie director of oil & gas, thermal generation and CCS at Scottish Enterprise said: "This report provides strong evidence of the significant economic potential in developing Carbon Capture and Storage on the UK Continental Shelf, particularly when combined with enhanced oil recovery techniques.
"Our world-leading oil and gas sector means we already have the infrastructure and skills in place in Scotland to exploit this potential, which was highlighted in the recently launched industry-led Oil & Gas strategy for Scotland.
"We will be working closely with industry, key stakeholders and other partners to explore this potential and ensure we take full advantage of the significant economic opportunities we know this activity represents."