Energy Transition Outlook 2021

ENERGY TRANSITION OUTLOOK 2021

Likewise, although smaller in terms of overall investment, the offshore elements of CCUS projects will be significant. Expenditure for the carbon transport and storage element of CCUS is estimated in the NSTD at around £2-3 billion over the period to 2030, and £5 billion by 2035. It includes many activities directly related to oil and gas such as installation and management of pipeline equipment, offshore facilities and compression equipment. An initial estimated breakdown of offshore expenditure elements is set out in the chart below.

To achieve positive outcomes in terms of local content, further work is needed to identify, map and understand the CCUS supply chain, something which OGUK continues to work on with members and other organisations. It is clear from the offset however, that supply chain companies will have a role across the whole breadth of the value chain. This includes both active CCUS systems, related technologies and the monitoring and decommissioning of storage sites and infrastructure in the longer term. The CCSA concluded that there were a range of possible activities that would help in terms of: • securing a good environment for fabrication including building excellence in modularised construction • strengthening trade skills across the whole energy sector which needs to be refreshed to attract a diverse new workforce in the medium and long term • improving the prospects for UK content in steel and pipe spool manufacture (potentially the largest individual single spend element) • although the UK lacks production of specialist rotating equipment, developing a segment of this market for particular attention e.g., high pressure hydrogen or CO 2 compression, may yield positive results

Figure 15: Expenditure for carbon transport and storage

3% 3% 2%

19%

2%

12%

DECOM 11%

CAPEX 45%

OPEX 44%

17%

19%

6% 2% 7% 7%

Source OGUK/CCSA analysis

30