Memorandum of Cooperation on Carbon Capture and Blue Hydrogen to Develop Regulatory and Strategic Frameworks

Memorandum of Cooperation on Carbon Capture and Blue Hydrogen to Develop Regulatory and Strategic Frameworks

Sunday, November 12, 2023

The Ministry of Energy and Minerals (MEM) has signed a Memorandum of Cooperation (MoC) in the field of Carbon Capture, Utilization and Storage (CCUS) and blue hydrogen development in the Sultanate of Oman with Petroleum Development Oman, Oman Shell, OQGN, and Oxy. The MoC aims to form an expertise house that contributes to the development of the regulatory and strategic framework in this field. The MoC comes as part of the government-led initiatives focused on  carbon capture technologies and blue hydrogen production to achieve Oman's energy transition strategy for Energy transition, and the Sultanate of Oman announcement t of achieving Net Zero by 2050.  The signing ceremony was held under the patronage of H.E. Mohsin bin Hamed Al Hadhrami, Undersecretary of the Ministry of Energy and Minerals.

The CCUS technology presents promising solutions to reduce carbon emissions and achieve Net Zero, particularly in the oil and gas production sectors, industries, and fossil fuel-based power plants. The Sultanate of Oman's National Strategy for an Orderly Transition to Net Zero has indicated that CCUS will contribute to a significant reduction (approximately 15%) in domestic emissions, thereby facilitating Oman's journey toward Net Zero by 2050. This MoC represents a continuation of efforts to find practical solutions to reduce carbon emissions and enable pioneering initiatives and future projects related to the field of carbon capture and blue hydrogen production. This objective can be achieved through forming a specialized House of Expertise to conduct a comprehensive techno-economic assessment in the Sultanate of Oman and to contribute to the development of the regulatory framework and strategies necessary for the advancement of this sector.

The House of Expert will consist of team from MEM, and partners experience in the fields of energy, CCUS, and development of blue hydrogen. Workstreams will be established to develop specific technical and organizational aspects throughout the value chain processes, with a participation from both public and private sector, academic institutions, and experienced investment and research institutions. H.E. Mohsen bin Hamad Al-Hadhrami, the Undersecretary of MEM, stated the following: "It is important to take accelerated efforts in utilizing the elements of a clean economy, by employing functional solutions and collaborating with our partners in the sector to achieve the targeted results within the designated time-frame, through applying the best practices and advanced technical solutions in the field of carbon management in a systematic sustainable manner”.  

Dr. Firas bin Ali Al-Abduwani , Director General of Renewable Energy and Hydrogen at MEM, said, "The study to be carried out by the House of Expert in the field of carbon capture and production of blue hydrogen will contribute to complementing the ongoing efforts by the public and private sectors to reduce carbon emissions. This will involve conducting a comprehensive techno-economic and legislative assessment with the aim of shaping the future legal framework and establishing appropriate regulations to facilitate investments in this field, consistent with Oman's ambition to achieve Net zero.”

On the other side, Occidental of Oman Inc, and OQ Gas Networks SAOG (OQGN), signed a Memorandum of Understanding (MoU) to jointly study potential carbon capture, utilization, and sequestration (CCUS) projects in Oman. The MoU outlines the companies’ mutual collaboration to study the development and deployment of CCUS in conjunction with enhanced oil recovery (EOR) projects at Oxy’s production assets in Oman. Under the terms of the MoU, Oxy Oman and OQGN intend to exchange knowledge and technical expertise to develop strategies enabling the deployment of CCUS projects in Oman in line with the national strategic direction, including carbon capture, transport of carbon dioxide to Oxy’s production assets for EOR, and supporting the development of relevant policies and procedures with the appropriate government bodies.

The strategic collaboration between Oxy Oman and OQGN demonstrates the two companies’ commitment to innovation and advancement of CCUS and future EOR projects in Oman. The MoU also underpins both companies’ dedication to enabling Oman’s long-term Net Zero strategy and global climate objectives. The MoU was signed by Mansoor Al Abdali, Managing Director of OQGN, and Steven Lauver, President & General Manager of Oxy Oman, on behalf of their respective organizations. The event was held along with the signing ceremony of the CCUS and Blue Hydrogen Policy & Regulatory Framework Terms of Reference (CCUS ToR). The CCUS ToR aims to facilitate effective collaboration between key stakeholders across the Government and the Oil & Gas industry and supports effective implementation of CCUS in Oman.

“This strategic collaboration with OQGN will enable our companies to generate opportunities to advance CCUS projects in the Sultanate. We are leveraging Oxy’s global 50-year expertise in carbon management and enhanced oil recovery, and combining it with our decades of partnership and operational success in Oman to develop carbon management solutions in line with the long-term objectives of the Omani government. We believe CCUS has the potential to unlock further development of the hydrocarbon industry while reducing greenhouse gas emissions” said Steven Lauver, President & General Manager of Oxy Oman. He added: “We are also excited to be part of the CCUS and Blue Hydrogen Policy & Regulatory Framework Terms of Reference where CO2 extraction technologies such as Direct Air Capture (DAC) can be studied in conjunction with initiatives of other stakeholders.”

Mansoor Al Abdali, Managing Director of OQGN, said: “We look forward to working closely with Oxy Oman to jointly develop CCUS and EOR projects, and being a key enabler for the country’s decarbonization initiatives. This agreement, together with our participating as a core member of MEM’s CCUS and Blue Hydrogen Policy & Regulatory Framework group emphasizes our commitment as the national gas infrastructure company in leading the development and deployment of CCUS and hydrogen infrastructure to support Oman’s energy transition goals and aspirations. We leverage on our expertise in natural gas transportation to provide the link between emitters of carbon dioxide and various sinks to realize the national agenda in a cost-effective manner”.

 

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