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March 14, 2009

Maersk Tankers eyes CO2 transportation

Could Carbon Capture and Storage (CSS) create a new market opportunity for tankers? Maersk Tankers seems to think so.

Up until now, tankers have generally been seen as part of the problem when it comes to emissions of greenhouse gases that contribute to global warming. Now, it seems, they could be part of the solution--by transporting captured CO2 that has been sequesterd by sources such as coal fired power plants to undersea storage sites.

Maersk Tankers says it is prepared to enter into the CO2 transportation market to help promote CCS, a technology identified as a key to lowering greenhouse gas emissions.

"With this initiative we want to show industrial leadership by demonstrating we can act on the global challenge that is carbon emissions," says Maersk Tankers Senior VP Martin Fruergaard.

Maersk Tankers has examined the business case for entering into the CO2 transportation market for either offshore storage or enhanced oil recovery (EOR) using CO2 to increase oil recovery rates in maturing fields.

"By utilizing our experience in transporting liquefied petrochemical and natural gasses, we have developed a large scale case for transport of CO2 for storage or EOR," says Mr. Fruergaard.

According to Maersk Tanker studies, more than 750 million tonnes of CO2 are emitted from large stationary power plants close to the sea in the North Sea region alone. Fifteen Handysize Gas Carriers (20,000 cbm) could transport more than half of Denmark's annual CO2 emissions for storage in the North Sea, the equivalent of all CO2 from large Danish stationary emission sources. CO2 fraction retained in selected reservoirs is likely to exceed 99 percent over 1,000 years, according to the Intergovernmental Panel on Climate Change.

Transporting CO2 by sea is cost-competitive and more flexible than pipelines on longer distances or in smaller quantities, says Maersk Tankers.

Maersk Oil is also looking into opportunities linked to CCS.

"Given our experience from the Danish underground in the North Sea and the high-level of knowledge we have gained from that, Maersk Oil is investigating CO2 mitigation technologies for the geological storage of CO2 to meet the expected demand," says Michael Engell-Jensen, senior vice president and head of Maersk Oil's Carbon and Climate Department.

Maersk Oil is in discussion with a number of potential partners to develop Carbon Capture and Storage projects that will remove CO2 from point sources such as coal fired power plants, and store the CO2 underground, either onshore or offshore.


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