Aug-2024

Role of liquefied CO2 carriers in the carbon value chain

Demand for carbon capture is set to grow and with it demand for ships to carry it for storage or new applications.

Tao Shen
American Bureau of Shipping (ABS) Global Sustainability Center

Article Summary

Carbon capture, transport, and storage will be essential for achieving the decarbonisation of the world economy in line with the greenhouse gas (GHG) emission reduction targets of the Paris Agreement. Sequestration of CO2 captured from onshore power stations, petrochemical and other industrial plants, and manufacturing processes forms the principal demand driver for the transport of liquefied CO2 (LCO2) by ship.

As per the latest report from the Global CCS Institute, the capacity of all carbon capture and storage (CCS) facilities under development has grown to 361 million tonnes per annum – growth of 48% since the 2022 report. Total capacity of the CCS project pipeline has grown at a compound rate of more than 35% per annum since 2017, and the 48% annual increase in 2023 is the largest since upward momentum began in 2018.

The number of CCS facilities in the development pipeline is also at an all-time high. As of July 2023, there are 392 projects, representing a 102% year-on-year increase. Since the Institute’s 2022 report, 11 new facilities have commenced operations, and 15 new projects have started construction. Some 198 new facilities have been added to the development pipeline, bringing the current total to 41 projects in operation, 26 under construction, and 325 in advanced and early development.

Growing demand
For the maritime industry, the 2023 International Maritime Organization (IMO) revised GHG Strategy of achieving net zero GHG emissions by or around 2050 will lead to significant changes. Vessels will need to switch from traditional fuels to greener alternatives. Investments in liquefied natural gas (LNG), liquefied petroleum gas (LPG), and methanol dual-fuelled vessels continue to grow quickly, prompting industry discussion and debate about which alternative fuels producers can provide at affordable prices.

For its updated Low Carbon Outlook, ABS re-examined the supply and demand data for alternative fuels and updated the future fuel mix to reflect the latest market information. In addition, the study looked at how the recent adoption of the revised IMO decarbonisation strategy and the 2050 net zero targets affected the projected future fuel mix.

By combining the derived ship demand with a forecast for a changing fuel mix in deep sea shipping, the scenarios for global energy consumption are translated into global fuel consumption by ships. Overall, with the updated findings, ABS finds that by 2050, demand for fossil fuels has the potential to be marginally lower than that estimated in the previous edition of the Low Carbon Outlook, once again underlining the need for onboard carbon capture technologies.

The adoption of onboard carbon capture for the shipping industry will require LCO2 reception infrastructure at ports, from where the captured CO2 can be transported to offshore storage or for industrial use. This could potentially drive LCO2 shipping from ports to offshore facilities, whether over short or long distances.

As the fleet of LCO2 carriers is expected to grow, there is a concern about the carbon footprint of the emerging fleet and its impact on the overall reduction of GHG emissions in the value chain. While LNG has been chosen as the fuel for some of these vessels currently under construction, there are potentially alternative solutions, such as using ammonia and methanol or installing onboard carbon capture systems for vessels powered by traditional fossil fuels. The latter option can be particularly interesting since these vessels will be equipped with a CO2 handling system, and maybe their access to the CO2 receiving terminals will facilitate the offloading.

Developing onboard carbon capture
Existing CCS technologies are largely employed in shore-based applications. These technology platforms need to be marinised for shipboard application and in a way that balances effective performance against Capex, Opex, and additional fuel consumption.

Onboard CCS reduces GHG emissions from ships by capturing and storing the CO2 produced onboard. This can be done either before or after the combustion process, using different methods and the captured carbon can be stored onboard in different ways, depending on the technology used.

Two potential onboard carbon storage methodologies are:
- Liquefaction: The CO2 is compressed and cooled to form a liquid, which can be stored in tanks or cylinders onboard and can be transferred to shore facilities or other vessels.
- Mineralisation: CO2 is reacted with minerals to form solid carbonates, which can be stored in containers.
ABS is currently working with vendors and shipowners to understand how this emerging technology can be adapted and absorbed into the maritime industry, its implications for vessel design and operations, and its likely impact on carbon emission reduction.

Onboard CCS application challenges
There are several challenges associated with onboard CCS, which include the high cost and complexity of the value chain, which involves multiple actors and stages such as CO2 capture, storage, transport, injection, and monitoring. Each stage has its own technical, operational, and safety requirements that require attention.

The value chain that will handle and store ever-larger volumes of carbon is still in the development phase; large-scale storage and processing capacity will be required. For onboard CCS to scale sufficiently, the shipping industry will need to collaborate with other stakeholders in order to establish the required infrastructure and agreements.

Stronger regulation is needed to create a long-term pathway against which owners can invest. Additionally, the public’s perception and acceptance of CCS are influenced by their awareness and understanding of the benefits and risks of the technology.

ABS activities
ABS has been working with global shipping organisations on joint development projects (JDPs) to showcase the safety and feasibility of using onboard CCS. We take a technology-neutral approach, working with vendors and stakeholders across the supply chain to provide Approvals in Principle and New Technology Qualifications to validate concepts and encourage full-scale pilots. We expect the first systems to be potentially available next year.

Additionally, ABS is collaborating with universities and research institutes to explore the potential of various carbon capture technologies for marine and offshore applications. ABS is dedicated to supporting the decarbonisation of the shipping industry and advancing the development of onboard carbon capture as one potential solution.

ABS has established a set of guidelines to direct the maritime industry on how to apply carbon capture technology. These guidelines also comprise an optional ‘CCS-Ready’ notation for vessels based on their level of preparation or readiness for future installations.