Foils from the speech in pdf

Dear audience,
It is a pleasure for me to address the 8th International Conference on Greenhouse Gas Control Technologies. This event is an important meeting place for policy makers and scientist with an interest in the climate change challenge and possible technological abatement tools. I am happy to note that this particular conference has attracted many hundred participants and I think this clearly illustrates the importance of the topic.

Come to think of it, I do not think you could find a better location than Trondheim to bring together the international community to discuss greenhouse gas control technology issues. Situated by the Trondheim fjord, the city is surrounded by forested hills, with the Nidelva River winding through the town. Trondheim has been and still is a popular pilgrimage site. Today it is a modern city, a centre of knowledge with a highly respected university and a research community ranking among the best in Europe. The Norwegian University of Science and Technology and the largest independent research organization in Scandinavia, SINTEF, represent academic eminence in technology and natural sciences as well as in other academic disciplines. Both NTNU and SINTEF take active part in some of the most important international R&D projects on carbon capture and storage.

The Energy Challenge
In its World Energy Outlook, The International Energy Agency has forecasted a massive increase in global energy demand, including a doubling of electricity demand, between 2004 and 2030. The share of oil and gas in the world energy mix is expected to rise from around 55 percent today to about 60 percent in 2030. In reality this means that even if the world is successful in considerably increasing the use of renewable energy sources, we will still be heavily dependent on fossil fuels for the foreseeable future.

At the same time, evidence suggests that the impacts of climate change are increasing. If no action is taken, there could be a continuing increase in global temperatures and, by the end of the century, all regions of the world could potentially face serious consequences for their economies and ecosystems.

Consequently, we are faced with a major challenge that requires us to take actions.

The Energy Challenge – The Norwegian Scene
From a Norwegian point of view, experience from recent years have clearly illustrated that a secure energy supply requires an energy system that has increased production capacity and is less dependent on hydropower. In this context, an important element in the Norwegian energy policy is to create favorable conditions for developing environmentally friendly alternatives to hydropower. Reduced energy consumption, increased energy efficiency and use of renewable energy sources such as wind and biomass have been introduced as necessary measures. Furthermore, building of gas-fired power plants with carbon capture and storage is launched as a possible solution for a secure and sustainable energy system in Norway.

In order to meet the Norwegian – and the worldwide – energy and climate challenges, I am convinced that we need both to increase the use of renewable energy sources and find sustainable ways of using fossil fuels. Furthermore, we need to use the available energy more efficiently. By developing efficient carbon dioxide capture and storage technologies we could increase security of energy supply, significantly reduce greenhouse gas emissions and maybe also increase oil and gas production. I guess all of you agree with me when I recognize CCS a very tempting way to meet our major energy and climate challenges.

A Large Potential for Carbon Dioxide Capture and Storage
Estimates show that the potential for CCS is large. The 2005 Special Report on Carbon Dioxide Capture and Storage from the Intergovernmental Panel on Climate Change (IPCC) gives an estimated range of the economic potential for CCS in the next century between 200-2000 Giga tons of CO ₂. As a comparison, the EU's Emissions Trading Scheme covers about 2 Giga tons of CO ₂ per year. Nevertheless, the actual application of CCS will depend on a wide range of factors including costs, other environmental impacts, public acceptance, and technology development, transfer and diffusion.

Most elements of the CCS chain are to a large extent proven technology, and in many cases already commercially used in some form. CO ₂ capture technology is however not yet applied in full scale power plants. A vital challenge in this respect is to significantly reduce the costs of capturing CO ₂. The energy required to operate CO ₂ capture systems significantly reduces the overall thermal efficiency of generation. These efficiency losses could be more than 20-30 percent, depending on the power plant and capture technology.

Next to economic feasibility of the current CCS technology, I find that the regulatory framework and public acceptance are two of the most important challenges for the deployment of CCS technology. We have to be able to ensure the environmental integrity of the technology, both in the short and long term.

Norway in the lead
Norway’s special situation as energy rich nation, together with a national focus on the climate challenge, makes a promising foundation for succeeding in realizing CCS: We have important experience through storage of carbon dioxide from the Sleipner field. This is the most extensive storage project of its kind in the world.

Furthermore, there is a potential for additional income through increased oil recovery trough injection of carbon dioxide. In this context Norwegian power and process industries have considerable experience with implementing new advanced technology.

The offshore Sleipner project represents nearly a decade of experience of monitoring and verification of geological storage of carbon dioxide. Comprehensive research and monitoring activities from this project indicate that injection and permanent storage of CO ₂ in sub-seabed geological structures can be done safely and reliably. Furthermore, The Snøhvit field in the Barents Sea will start producing in 2007, and will provide further experience on CO ₂ geological storage.

Earlier this year Shell and Statoil signed an agreement to work towards developing the world's largest project using carbon dioxide for enhanced oil recovery offshore. The concept involves capturing CO ₂ from power generation and utilizing it to enhance oil recovery, resulting in increased electricity production and increased oil production with lower CO ₂ impact. This project could be an important milestone towards realizing our vision for green use of fossil fuels.

Aker Kvaerner, a big Norwegian construction company, has together with Gassnova and other partners launched the “Just Catch project”. The main goal is to develop new technology which would capture CO ₂ more cost efficiently. The project aims to develop new technology which can be implemented for gas-fired power plants within 2010.

I will also mention that SINTEF has been given the responsibility for coordinating the first phase of the Hypogen project. This project will give an important contribution to the development of CCS by demonstrating the technical feasibility and economic viability of producing hydrogen and electricity from fossil fuels with near-zero CO ₂ emissions. In the project’s launch phase, which has been given the name "Dynamis", scientists and industrialists from 11 European nations will evaluate, among other aspects, where this unique plant should be built, and which technology should be utilized.

An Ambitious Policy for Carbon Dioxide Capture and Storage inNorway(1)
Let me now turn to the Norwegian Government’s ambitious goals to realize capture, use and storage of carbon dioxide in Norway. The Government aims to cooperate with industry to realize capture of carbon dioxide at gas-fired power plants as soon as possible. This includes considering value chains involving capture, transportation and injection of CO ₂ for enhanced oil recovery and contributing financially to the realization of such chains.

We have started the process towards achieving our goals. I have respect for the complexity of the task, and will make sure that our ambitions are implemented in a sound manner, economically and legally.

This year The Ministry of Petroleum and Energy will ensure that a proper process is initiated between the commercial actors to verify costs in all parts of the CO ₂ value chain. Involvement of commercial actors on land and offshore is vital to obtain a best possible overview of costs and benefits in such a value chain.

An Ambitious Policy for Carbon Dioxide Capture and Storage inNorway(2)
To achieve our ambitious goals, Gassco, in collaboration with Petoro and Gassnova, was asked to identify potential value chains for carbon dioxide. Earlier this month I received their report. Gassco’s study has identified six fields on the Norwegian continental shelf as potential candidates for carbon dioxide injection. These are Draugen, Gullfaks, Oseberg East, Brage, Gyda and Volve. These fields provide a basis for 12 alternative CO ₂ value chains. However, none of the identified value chains show a positive commercial return on capital invested. The report indicates negative net present values in the magnitude of € 550-1500 millions. The results of this study will be the basis for assessments regarding the Government’s further efforts to realize CCS.

Furthermore, planning of the facility for capture of carbon dioxide at the Kårstø gas-fired power plant is given high priority. I am expecting the results of The Norwegian Water Resources and Energy Directorate’s work related to verification of CO ₂ capture technology and costs later this year.

Knowing that the CCS option form part of a wide range of possible carbon abatement options, we have to carefully consider the possibilities at hand for strengthening the incentives for CCS. Decisions on the best organization of state involvement will depend on thorough assessments of a wide range of issues of technical, economic and legal character, including state aid regulations. Ongoing work in the Ministry intends to clarify these aspects.

We want to collaborate internationally in order to succeed with our goals regarding CCS. Therefore UK and Norway has agreed to take bilateral steps to explore possible areas of co-operation to encourage injection and permanent storage of CO ₂ in geological structures beneath the seabed. Our two countries have agreed to set up a North Sea Basin Task Force with the aim to develop comprehensive, common principles as a basis for regulating CO ₂ storage in the North Sea.

Need for further technology development
Even with these ambitious projects going on, I will underline the need for further technology development. New or improved methods of CO ₂ capture, combined with advanced power systems, can significantly reduce CO ₂ capture costs and associated energy requirements. Realization of future cost reductions will require deployment and adoption of commercial technologies in the marketplace as well as sustained R&D.

In an effort to speed up the development of CCS technologies, the state centre for sustainable gas technologies, Gassnova, is supporting demonstration and pilot projects. Together Gassnova and the Research Council of Norway administer about € 18 million annually to support research, development and demonstration of such technologies. Joint efforts with industry could bring up the rate of activity to a hundred million euros per year. This is a considerable effort in an international context.

Gassnova focuses on a broad portfolio of different technology options. Following this strategy we could succeed in realizing more cost efficient technologies in a relatively short time horizon, while simultaneously working with less mature technologies that could decrease costs in the more distant future.

Conclusion
Summing up, the world is in need of concrete actions to curb CO ₂ emissions. Carbon dioxide capture and storage could play an important role in the portfolio of mitigating actions for stabilization of atmospheric greenhouse gas concentrations. In addition, injection of CO ₂ in producing fields could contribute to enhanced oil and gas recovery. However, we have to acknowledge that realizing carbon capture and storage on a large scale is still a very challenging task, which requires close cooperation with the institutional and commercial players.

The Norwegian Government has ambitious goals regarding capture, use and storage of CO ₂. The commitment to develop gas-fired power stations with carbon capture and storage in Norway is an important element of our energy policy. Succeeding with our efforts, we will achieve a more secure energy supply and contribute to substantial reductions in greenhouse gas emissions. At the same time Norwegian industry and research institutions could get a comparative advantage within a internationally very interesting area.

International cooperation is a key in order to develop efficient solutions for CCS. Norway is heavily involved in important initiatives for international collaboration in this area.

Thank you very much for your attention!