Horisont Energi and PGNiG Upstream Norway (PUN), part of Poland’s ORLEN Group, have signed a sales and purchase agreement (SPA) under which PUN acquires a 50% participating interest in the only CO2 exploration license in the Barents Sea and is willing to take over the operator role.
Under the SPA, PUN acquires a 50% participating interest in the Polaris CO2 exploration license EXL003, so that both companies will hold 50% each.
The license group has also submitted an application to the Norwegian authorities for PUN to become the new operator in the license.
The effective date of the SPA is December 1, whereas the completion date will be no later than December 31. The SPA is subject to approval by Norwegian authorities.
“CO2 capture and storage will play a pivotal role in delivering the Group’s climate policy, also enabling us to introduce a new carbon management service. With soaring CO2 allowance prices, carbon storage becomes crucial for sustaining the competitiveness of certain industries in Poland and other EU countries,” said Daniel Obajtek , ORLEN CEO and President of the Management Board.
“The growing interest in carbon storage services underscores the significance of today’s transaction, granting the ORLEN Group an interest in the Polaris licence in the Barents Sea, designated for carbon dioxide injection. The project will enhance our capabilities and know-how in offshore CO2 storage, a valuable asset that can also be leveraged in Poland.”
The license is located several hundred meters below the seabed in the Barents Sea, 140 kilometers off Hammerfest. The reservoir is a key component for the planned Barents Blue ammonia plant, with captured CO2 from the sequestration of natural gas and production of blue ammonia set to be stored in the Polaris reservoir.
In addition, the reservoir will be available for third-party storage. German energy giant E.ON signed a letter of intent (LoI) earlier this year committing to buy and store 1 million tonnes of CO2 from European customers.
The Polaris reservoir is currently undergoing subsurface assessment and studies, with the offshore pre-survey completed. The application for the exploration license was submitted in 2021, the Norwegian Ministry of Petroleum and Energy announced the award of the license to a group consisting of Horisont Energi, Equinor and Vår Energi on April 5, 2022, and in June the same year, the storage license was formally approved.