North Sea net zero transition will cost £430billion, says OGTC – Wood Mackenzie report

16/09/2020 10:41
Sept - North Sea net zero transition will cost £430billion, says OGTC – Wood Mackenzie report.jpg

Positioning the UK North Sea for a net zero future will cost more than £430billion, according to a new report from the Oil and Gas Technology Centre (OGTC) and consultancy Wood Mackenzie.

The reward of creating such an “integrated net zero energy system” – a mix of oil and gas with other renewable sources – is the creation of 200,000 new UK jobs and £2.5trillion for the economy by 2050, according to the research, produced with support from operator Chrysaor and the Scottish Government.

However realising this means the industry and governments need to “focus investment at pace in the coming years” to close the gap on a number of key technologies.

This will require £430bn to be spent globally on development, of which around £270bn is expected to be spent in the UK, according to “Closing the Gap: Technology for a Net Zero North Sea”.

Some of the areas highlighted by the OGTC are platform electrification, methane leak detection and flaring mitigation for oil and gas, as well as larger blades, taller towers and automated inspection for fixed offshore wind.

It also refers to improving ”blue hydrogen” production (from natural gas) and reducing cost of “green hydrogen” (via renewables), as well as measures to improve economics of carbon capture and storage (CCS) technology, and power off-take solutions for marine renewables like floating solar.

OGTC chief executive Colette Cohen said: “Reimagining the North Sea as an integrated energy system is essential for the UK and Scotland to achieve their net-zero ambitions. But we need to invest now to close the gap on the key technologies needed to make this ambition a reality.

“Leveraging our strength in oil and gas, we can also partner with the renewables sector to accelerate the delivery of the next generation of energy in the UK – and internationally. This is where governments and industry should focus investment at pace in the coming years.”

Renewables and oil and gas will “dominate” investment over the next 15 years, the report states, while the burgeoning hydrogen and CCS industries will see the largest cash injection from 2035 onwards as they mature.

Read the full story here.

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