Eni and the UK Government’s Department of Energy Security and Net Zero (DESNZ) have reached an agreement in principle on the key terms and conditions for the economic, regulatory, and governance model for the transportation and storage of CO2 at the HyNet North West industrial CCS cluster.
Principles outlined in the heads of terms pave the way for the completion of definitive agreements in the coming months, Eni said.
Furthermore, the agreement was described as an important step towards HyNet North West becoming fully operational as the world’s first asset-based regulated CCS business, providing carbon transportation and storage for companies in the North West of England and North Wales.
Eni aims to transform one of the UK’s most energy-intensive industrial districts into one of the world’s first low-carbon industrial clusters with this project.
HyNet North West is expected to be operational by the middle of the current decade with a storage capacity of approximately 4.5 million tonnes of CO2 per year in the first phase. It has the potential to remove approximately 10 million annually after 2030 and contribute to the UK’s target of storing 20-30 million tonnes of CO2 annually by 2030.
In addition to HyNet North West, Eni is planning a second UK CCS hub to decarbonize the Bacton Energy Hub and the Thames Estuary region and has secured a license to store CO2 in the depleted Hewett gas field in the Southern North Sea.
Together, HyNet North West and Bacton have the capacity to store 500 million tonnes of CO2.
Eni’s CEO, Claudio Descalzi , said: “CCS will play a critical role in energy transition, cutting safely emissions from industries that currently don’t have the technology to do so another way. Today’s agreement is a significant step towards establishing a significant new industry for the country.
“The Heads of Terms outline a regulated model that can help the CCS industry achieve scale and provide the certainty needed for private sector investment. This kind of close cooperation with the public sector will be critical to developing the kind of groundbreaking projects we need to address the climate challenge.”