Image Credit: Net Zero Teesside
Net Zero Teesside Power (NZT Power) and the Northern Endurance Partnership (NEP) have unveiled a wave of construction contracts worth approximately £4 billion. These contracts, spanning engineering, procurement, and construction, are poised to catalyze transformative low-carbon infrastructure initiatives throughout the northeastern region.
At the forefront of these endeavors is NZT Power, a visionary project to usher in a new era of sustainable energy. By integrating cutting-edge gas-fired power technology with advanced carbon capture capabilities, NZT Power has the potential to generate an impressive 860MW of low-carbon electricity.
Spearheaded by the dynamic partnership of BP and Equinor, this venture is engineered to capture and sequester up to two million tonnes of CO2 annually, leveraging the expertise of the NEP—a collaborative effort between BP, Equinor, and TotalEnergies—to securely store these emissions beneath the vast expanse of the North Sea.
The implications are monumental. NZT Power stands poised to stimulate the creation of over 3,000 construction jobs, with an additional 1,000 positions anticipated annually throughout its operational lifespan, which will extend to 2050.
Moreover, the onshore infrastructure developed by NEP promises to underpin a diverse array of carbon capture projects clustered around the bustling hub of Teesside. Among these initiatives are NZT Power, H2Teesside, and Teesside Hydrogen CO2 Capture, each handpicked by DESNZ for inaugural connections to the East Coast Cluster in March 2023.
Projections suggest that these projects collectively could facilitate the transportation and storage of approximately four million tonnes of CO2 per year by 2027—an achievement of staggering significance in the battle against climate change.
The roster of collaborators is equally impressive. Technip Energies and the GE Vernova consortium, bolstered by the expertise of Balfour Beatty and Shell, have been entrusted with pivotal onshore contracts encompassing power generation, capture, and compression. Concurrently, venerable construction firm Costain has been tapped to spearhead the development of an onshore CO2 gathering system and gas connection infrastructure.
In a testament to the project's global reach, Marubeni-Itochu Tubulars Europe, alongside industry stalwarts like Liberty Steel Hartlepool and Corinth Pipeworks, have been enlisted to fortify the project with comprehensive onshore and offshore line pipe solutions. Meanwhile, Alcatel Submarine Networks has been entrusted with supplying power and communications cables, ensuring seamless connectivity across the project's expansive footprint.
Complementing these efforts are the contributions of Saipem, TechnipFMC, Genesis, and Wood, who have been enlisted to provide an array of offshore and project management services—a testament to the collaborative spirit underpinning this ambitious endeavor.
While awarding these contracts marks a significant milestone, the path forward is not without its challenges. Regulatory clearances and final investment decisions loom, underscoring the need for unwavering commitment from project developers and the UK government.
Amidst mounting pressure, stakeholders in the nascent carbon capture industry are calling upon government officials to expedite formulating a comprehensive policy framework and subsidy mechanisms.
Ruth Herbert, chief executive of the Carbon Capture and Storage Association, warns that failure to act swiftly risks squandering a golden opportunity—one that could reshape not only the energy landscape but also the nation's economic trajectory.
"The UK's CCUS industry is still waiting for the funding announced in last year's spring budget to be committed to projects, with final investment decisions for projects in the north-west and north-east of England needed in the next few months," she said. "Today's Budget was a missed opportunity for the government to put in place a longer-term revenue support envelope for the next wave of projects - to provide the level of certainty they need to move forwards.
"Without this, the UK risks losing the opportunity to attract around £30bn of private investment into UK CCUS by 2030, which would create and protect tens of thousands of jobs and transform industrial regions across the UK."
According to today's announcement, contractors will continue working with the local and regional supply chain in preparation for final investment decisions, with further engagement taking place over the coming weeks and months.
Ian Hunter, managing director at NZT Power, described the selection of contractors as a "major step" forward for the project.
"We have selected world-class partners who have the experience and capability needed to deliver," he said. We aim to make the final investment decision in September 2024 or before, after which we'd look forward to working with our EPC partners through the construction phase."
Chris Daykin, general manager of the NEP, said today's update was a "clear signal of momentum" within the East Coast Cluster.
"The Northern Endurance Partnership's CO2 pipelines are essential to connect carbon-intensive projects to offshore storage and would play an important role in helping the region pursue its net zero plan".
Tees Valley Mayor Ben Houchen also welcomed the news, saying the transformational economic impact across Teesside, Darlington, and Hartlepool cannot be understated.
"This would be the single biggest investment in Teesside since Imperial Chemical Industries," he said. "Our area is now the world-leading centre in developing the clean, green industries of the future, which most importantly will deliver the highly-skilled well-paid jobs of the future.
"This investment of £4bn will support businesses up and down the local supply chain, with companies like Hartlepool-based Liberty Steel already netting multi-million-pound contracts.
"I will continue to work to ensure local British firms benefit from this colossal investment as this world-first project moves forward to final investment decision in September this year."