Carbon Capture and Sequestration Market Size, Share & COVID-19 Impact Analysis, By End-Use (Enhanced Oil Recovery {EOR} and Dedicated Storage & Treatment), By Capture Source (Chemicals, Natural Gas Processing, Power Generation, Fertilizers Production, and Others), and Regional Forecast, 2021-2028

The global carbon capture and sequestration market size was USD 1.96 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with carbon capture and sequestration witnessing a positive demand shock across all regions amid the pandemic. Based on our analysis, the global Carbon capture and sequestration (CCS) market will exhibit a substantial growth of 12.2% in 2020. The market is projected to grow from USD 2.01 billion in 2021 to USD 7.00 billion in 2028 at a CAGR of 19.5% in the 2021-2028 period. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

CCS technology involves trapping, transportation, and storing harmful carbon dioxide emissions from various sources. The capture of CO₂ is usually performed through numerous procedures such as pre-combustion, oxy-fuel, post-combustion, industrial separation, or an amalgamation of various industrial processes. The seized CO₂ is transferred by multiple modes such as pipelines and tankers for storage in deep aquifers or reservoirs beneath the earth’s surface.

COVID-19 Impact: Halting of Operations & Decline in Economy to Affect Growth

The global pandemic has emerged as the most significant health problem, stopping nearly all the operations across industries. The coronavirus infection has obstructed almost all economies and forced many countries to go under lockdowns to contain the outbreak. While this issue is likely to be resolved quickly, climate degradation needs to be tackled long-term with stern actions.

However, the key problem that industry professionals face is the requirement of large capital expenditures (CAPEX) to set up new carbon capture plants. Furthermore, the abrupt decrease in the international crude oil prices has deteriorated opportunities for maximizing hydrocarbon production using CO₂-based EOR activities. Nevertheless, the financial booster plans introduced by various administrations to support the economic revitalization, coupled with a positive outlook towards industrial decarbonization, will complement the stability in this market.

LATEST TRENDS

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Collaborations among Industry Participants for Large Scale Projects to Propel Market Growth

Various market players are concentrating on joining forces to complete large-scale carbon capture and sequestration facilities and commercialize the technology. The partnerships are also focused on helping to gather the significant CAPEX required for new projects, coupled with the easy-rolling out of regional contracts to support the construction & operation of projects. For instance, in May 2020, CCS market majors, including Total, Shell, and Equinor, announced to invest about USD 680 million for the first phase of the Northern Lights CCS project. The project is set to be the maiden network as a CO₂ transport & storage hub, with its first stage focused on developing infrastructure to inject, transport, and store 1.5 metric tons per annum (MTPA) of CO₂.

Encouraging Financial Plans by Governments and Organizations to Add to Industry Pace

Numerous administrations are substantially investing in developing new alternatives to seize carbon from different sources efficiently. Besides, the organizations also focus on gathering insights regarding the new storage and utilization locations for sequestered gases. They also assist in developing numerous carbon capture technologies. For example, in July 2020, the United States Department of Energy (DoE) declared a grant of USD 11.5 million for the FLExible Carbon Capture and Storage (FLECCS) project. The program aims to enable new natural gas power generator systems and renovate prevailing units with critical carbon capture and sequestration needs.

DRIVING FACTORS

Stringent Policies & Positive Outlook to Mitigate Carbon Footprint will Propel Technology Demand

Different governments have introduced strict action plans to stabilize climate change and diminish the overall carbon emissions in near and long term periods. Stern activities to monitor and curb greenhouse gases (GHG) emissions from power generation facilities are set to further complement the market size. Consequently, in February 2020, the International Energy Agency (IEA) published that the global energy-related CO₂ emissions increased to 33.3 gigatonnes (Gt) in 2019 from 32.2 Gt in 2015, showcasing over 3.4% increase in just five years.

Growing Demand for CO₂ Enhanced Oil Recovery (EOR) Projects to Complement Industry Landscape

Enhanced oil recovery (EOR) is a tertiary oil recovery method deployed to recover over 65% of the total recoverable oil in place not produced through primary and secondary phases. Rising measures to cut the maximum carbon dioxide levels generated from fossil fuel production and utilization boost the carbon capture and storage market. For example, in June 2020, Alberta Carbon Trunk Line (ACTL) system CCUS project came online in Canada to seize harmful carbon dioxide from industrial facilities and utilize the gas for permanent storage and enhanced oil recovery.

RESTRAINING FACTORS

High Initial Cost & Feasibility Associated with New Projects May Hinder Market Growth

The requirement of significant capital cost to set up large-scale carbon capture and sequestration systems may obstruct the carbon capture and sequestration market growth. Additionally, the projects also need substantial annual operational expenses to run systems at optimum levels. Furthermore, the achievability of high capacity plants seizing multi MTPA of CO₂ also limits the technology adoption across various countries.

SEGMENTATION

By End-Use Analysis

Dedicated Storage & Treatment Segment to Observe Considerable Growth Backed by High Storage Potential

Based on end-use, the global CCS market can be majorly bifurcated into enhanced oil recovery (EOR) and dedicated storage & treatment. The dedicated storage & treatment segment is set to exhibit significant progress owing to the high storage potential across deep geological formations in onshore and offshore locations. Furthermore, the growing demand for fossil fuels across various residential, commercial, and industrial operations coupled with the ample presence of low-pressure aged oil & gas reserves is set to favor the outlook of the EOR segment.

By Capture Source Analysis

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Natural Gas Processing Was Estimated to Dominate 2019 Stoked by Rising Oil & Gas Production

Based on the capture source, the industry can be primarily divided into chemicals, natural gas processing, power generation, fertilizer production, and others. The natural gas processing segment was estimated to account for the major market share in terms of volume during the historical years. An increasing oil & gas production is set to lead to the setup of new processing facilities aiding the growth of this segment. Additionally, growing energy demand and high-capacity production plants are projected to propel the power generation segment landscape.

The exponentially increasing need for different chemicals to fabricate various raw materials and end-use products for a wide range of industries is likely to augment the chemicals source segment. Furthermore, the fertilizer production segment is also set to grow substantially over the forecast period frame due to the increasing use of high GHG emitting products such as ammonia & urea, thereby generating the need for handling excessive CO₂ content.

REGIONAL INSIGHTS

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The market has been analyzed across five key regions, including North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America. North America is likely to lead the global industry with a total size of USD 1.42 billion in 2020 due to the significant investments across research & development activities and the existence of different high-capacity carbon capture and sequestration plants. Additionally, funding initiatives from the regional governments have also favored regional expansion. For instance, in June 2021, the U.S. Department of Energy (DoE) announced a USD 12 million federal support to boost six R&D projects promoting direct air capture (DAC) technology to develop new tools for efficiently capturing CO₂ from the atmosphere.

Various large-scale projects in early development and feasibility study stages across countries such as Australia and China are projected to surge the industry size in the Asia Pacific. Furthermore, the presence of high volume storage locations, primarily across subsea oil & gas reservoirs with EOR operations coupled with favorable government initiatives, is set to favor the regional landscape. For instance, in August 2021, the governments of Australia and the U.K. declared their strategies to boost low emission technologies such as CCS, green hydrogen, CCUS, small modular reactors, among many others.

The availability of old bulk oil & gas reservoirs and the huge untapped potential to boost hydrocarbon production from enhanced oil recovery methods are factors likely to favor the Middle East & Africa CCS market. Furthermore, the announcement of new projects, low injection well drilling costs, and high storage capabilities in huge underground formations are other key factors propelling the regional outlook.

KEY INDUSTRY PLAYERS

Chevron is Focused on Increasing Investments in New Ventures to Boost Market Presence

The industry has observed many small and large products & services providers serve carbon capture methods and storage technology. Various companies have depicted significant interests in entering into collaboration agreements to outline the competitive landscape. Chevron is increasingly concentrating on setting up new CCS stations and its partnerships with various key players to enhance its presence across the different stages of operations. For instance, in February 2020, Chevron partnered with Wave and Marubeni Corp by investing USD 16 million in Carbon Clean Solutions, situated in the U.K. The venture targets to develop advanced CCS systems for easy integration in remote locations at a lower price by 2021.

LIST OF KEY COMPANIES PROFILED:

• Fluor Corporation (U.S.)


• ExxonMobil (U.S.)


• Carbon Engineering Ltd. (Canada)


• ADNOC Group (UAE)


• Equinor (Norway)


• China National Petroleum Corporation (China)


• Dakota Gasification Company (U.S.)


• Shell (Netherlands)


• BP (U.K.)


• Chevron (U.S.)


• Linde (Ireland)


• Total (France)


• Aker Solutions (Norway)


• NRG Energy (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• July 2021 – Shell unveiled its objectives to construct a large-scale carbon capture and storage (CCS) facility in Alberta, Canada. The plant is projected to seize CO₂ from its chemical and refinery plant store 300 million tonnes of carbon over its lifespan.


• June 2021 – Carbon engineering and Storegga declared to collectively initiate designing and engineering the first large-scale direct air capture (DAC) plant with a capacity of 0.5 to 1 MTPA in the U.K.

REPORT COVERAGE

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The global carbon capture and sequestration market report provides a detailed analysis of the market. It focuses on key aspects such as leading companies, technology types, and leading applications of the product. Besides this, the market research report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the industry growth over the recent years, such as the types of carbon capture machines.

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