The electrification of production platforms can help the oil & gas sector towards 2050 net zero targets, says David Clark, group energy director at Lloyd’s Register.
This article first appeared in The Scotsman newspaper.
The scale of the challenge in decarbonising our economy cannot be underestimated.
As we all know, oil and gas will remain an important part of our energy mix for the foreseeable future – the Committee on Climate Change’s “Net Zero” report recognises that our demand for gas will continue, with a projected decline of just 32 percent by 2050.
We will still rely on gas for some time to come, so the economic recovery of hydrocarbons from the UK Continental Shelf (UKCS) will remain key in meeting these energy demands and reducing the UK’s reliance on imports.
It is therefore timely that the Oil and Gas Authority (OGA) has just published Phase 1 of its UKCS Energy Integration report which examines the technical feasibility of a range of low carbon build out options – with the overall goal of reducing the CO2 impact of the oil and gas sector.
In particular, this report, led by the OGA, working with BEIS, The Crown Estate and Ofgem, and completed by Lloyd’s Register, identifies actions the industry can take towards a more integrated offshore energy sector and looks at five technology areas which might support the industry’s contribution to a low carbon economy.
Top of the list for early implementation is platform electrification, followed by gas-to-wire, carbon capture and storage, hydrogen (both blue and green) and energy hubs.
An early win
Platform electrification offers the opportunity for perhaps the most straightforward early win.
Today, the power demand for UKCS platforms is around 24TWh per year – which accounts for around two percent of UK power demand and over ten percent of total power plant emissions.
Although these figures are forecast to decrease, they will remain significant for years to come, and if we can make a major impact here today, our decarbonisation journey will be on the road.
There is the opportunity to capitalise now on the synergies which exist within the UK’s burgeoning offshore wind sector, with potential to share infrastructure as well as expertise and knowledge.
Already we see a significant build out of major wind farms in the Southern North Sea, with further leasing rounds by the Crown Estate and Crown Estate Scotland guaranteed to bring more activity further north and into deeper water – and therefore into proximity with oil and gas infrastructure.
Add to this, planned interconnectors between the UK and continental Europe and the opportunity to work in concert is clear.
The report examines all potential options, including generation at sea and floating nuclear; however, its CAPEX analysis suggests the most attractive investment opportunities will be connecting platforms direct to shore, connecting to offshore wind farms and tying into interconnectors.
Retrofitting any of these solutions to existing platforms will come at a cost, and the report suggests the case will be strongest for new fields such as West of Shetland where production will continue for many decades ahead.
And as we look forward, we can take great encouragement from progress already made.
Power to the platforms
In the Netherlands, Neptune’s Q13A-A production platform has been electrified from the shore, saving around 14,000 tons of CO2 per year.
More ambitious still is Equinor’s Johan Sverdrup field in the Central North Sea, which came onstream in October. It is Norway’s third largest field and is now already producing 350,000 barrels per day.
By powering the field almost entirely by hydroelectric power from shore, they have managed to slash emissions to just 0.67 kg — or four percent of the world average — per barrel produced. This means the field will avoid emissions of more than 620,000 tonnes of CO2 every single year.
This scheme has benefitted from Norway’s very low carbon hydroelectricity, yet it shows the potential to radically change the way oil is produced.
If this kind of initiative can be replicated in the UKCS, the impact will be significant.
And I believe the appetite is there. The downturn brought tough years for the sector, but today we have a much leaner industry with a new influx of nimble and agile companies keen to innovate and make a success of the UKCS.
Electrification of our platforms will further enhance our global expertise in oil and gas – with obvious synergies and opportunities to collaborate with offshore wind.
This transition will require a skilled workforce able to attract new talent and develop expertise across the value chain of all energy sectors.
Increasingly, we see demand for a technical offering that is sector agnostic, applicable to any type of complex or capital-intensive project from construction to decommissioning.
The green economy will only grow and if the UK can capitalise on its maritime strengths there will be further opportunities in new sectors such as gas to wire, carbon capture and storage and the generation of hydrogen, both green and blue.
World energy demand continues to rise, and we will still have a significant need for oil and gas in the foreseeable future. But not all barrels are created equal — and it’s important that the oil which we do produce, is produced as cleanly as possible.