7.1 Storage site selection economics

According to the EU GeoCapacity project several specific geological criteria are required for a site to be suitable for CO2 storage:

  • Appropriate depth of reservoir to guarantee that CO2 reaches its supercritical dense phase but not so deep that permeability and porosity are low;

  • Integrity of seal to prevent migration of CO2 from the storage site;

  • Enough CO2 storage capacity to receive the CO2 projected to be released from the source; and

  • Adequate petrophysical reservoir properties to guarantee CO2 injectivity to be economically feasible and that satisfactory CO2 will be retained (GeoCapacity, 2005).

These criteria hinge on the values of a number of geological and physical parameters and it is critical in the search for appropriate sites for CO2 storage to assess whether the criteria listed above and their related geological and physical parameters are satisfied. Screening sedimentary basins for CO2 storage potential is the first phase in a site selection procedure: it aims to identify predictable, laterally continuous, permeable reservoir rocks overlain by potentially good qualcty caprocks at an appropriate depth. The screening phase gives an indication of those sites which appear suitable based on existing data. The screening should therefore narrow the search at an initial phase so that overpriced and time-consuming additional studies such as collecting and interpreting seismic data are confined to small prospective regions (EU Geocapacity, 2005).

If a number of similarly appropriate CO2 sites are identified in the screening procedure, other non-geological criteria such as economic, logistical and conflict of interest considerations can be used to select which of those sites shall be investigated in further detail. According to the Global CCS Institute report, Global Status of CCS (GCCSI, 2010), in the initial demonstration phase of CCS development there is a strong economic driver to find storage locations close to emissions sources. In regions deprived of adequate storage potential, long-distance transport of CO2 by pipeline or ship might be feasible in the long-term once wide-scale deployment of CCS underpins the scale efficiencies that are necessary to moderate the price of CO2 transport over great distances.

The prospects for economic savings using proximate zones for storage needs to be balanced with consideration of the storage risk of candidate sites. Risk analysis and cost-benefit of the trade-offs between the storage asset quality, distance of transport and treatment of risk is less mature in CCS when compared to decision analysis in other more established resource sectors. Tested and well-established economic risk-based investment decision methods, adapted from, for instance, the oil and gas sector should be considered. In some cases, storage site selection and commitment have been too strongly based on the proximity to the emission source without considering a range of storage options. This can lead to a commitment to a single site or area prematurely. Such lack of integrated analysis can and has impacted significantly on timeline and economics for projects. In some cases, aggressive timing targets can lead to taking on higher risks, particularly for storage, if there are a limited number of choices. Viable storage capacity is that subset of the effective capacity that results from technical, legal, regulatory, infrastructural and general economic aspects of CO2 storage. As such, it is susceptible to rapid changes as technology, policies, regulations and economics develop.