Exxon Says CCS Projects In Southeast Asia Not Focused On Enhanced Oil Recovery 

Exxon Says CCS Projects In Southeast Asia Not Focused On Enhanced Oil Recovery  - Carbon Herald

Irtiza Sayyed, President, Asia Pacific at Exxon Low Carbon Solutions, said that the company’s carbon capture and storage projects in Southeast Asia are not intended for enhanced oil recovery (EOR). 

He spoke at a panel discussion hosted by the Atlantic Council and Japan’s Institute of Energy Economics (IEE) at the Singapore International Energy Week, Eco-Business reported. 

“Frankly, EOR is a nice idea but it doesn’t quite work commercially, nor does it work technically, particularly in Asia where there needs to be cross-border cooperation on carbon dioxide transport and sequestration,” Sayyed said. “We are focused on carbon capture for storage, and not for use.” 

Irtiza was addressing a question from Eco-Business regarding the measures Exxon is implementing to guarantee that its carbon capture and storage (CCS) collaborations in Southeast Asia will ultimately result in reduced emissions. This inquiry arised in light of accusations that major oil companies are leveraging carbon capture initiatives to extend the era of fossil fuels.

A week ago, the Washington Post published a report, which revealed that the majority of CO2 captured by oil companies isn’t sequestered underground but rather utilized to facilitate further oil extraction. The report alleged this practice receives financial backing from the U.S. government.

Relevant: Exxon Moves Forward With Carbon Capture Expansion In Southeast Asia

Irtiza told Eco-Business that for enhanced oil recovery to be effective, there must be a direct connection between the emissions source and the recovery site. However, he emphasized that would not be technically feasible in Asia.

“If you are capturing CO2 across the border, say in Japan, then intending to bring it to Indonesia for storage, that is going to be a two-point system that is going to be costly,” he said. “For EOR processes, it is best to do it in one place, safely. You would not want to ship the sequestered CO2,” he said. 

The abundance of depleted oil and gas reservoirs in Indonesia and Malaysia positions them as promising locations for the secure and long-term sequestration of carbon. In November of the previous year, Exxon entered into a partnership with Indonesia’s state-owned oil and gas company, Pertamina, to collaboratively establish a carbon storage hub. In January 2023, Exxon also forged an agreement with the Malaysian oil and gas company, Petronas, to embark on carbon capture and storage (CCS) initiatives.

Irtiza stressed that in addition to the right technical solutions, essential policies are needed to channel financing from economies like Singapore, South Korea, and Japan to support CCS hubs in Indonesia and Malaysia.

This year, Exxon pledged to allocate billions of dollars to its low carbon business sector. Nevertheless, critics argue that these investments in lower-emissions technologies represent just around 10% of their total spending over a five-year period. Opponents also say that this shift is primarily motivated by capitalizing on the incentives provided by Biden’s Inflation Reduction Act, which offers substantial subsidies for various green technologies.

Exxon’s strategy also includes a plan to increase its oil and gas production by 3% annually until 2027. This sets the company apart from its European counterparts who have indicated their intention to either maintain production at current levels or allow it to decrease.

Read more: Exxon And Petronas To Expand Carbon Capture In Malaysia

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