GCC must unite to capture advantage on carbon storage

An important step in the fight against climate change has just been announced.
The veteran Qatari energy minister Abdullah al Attiyah, opening the inaugural Doha Carbon and Energy Forum two weeks ago, revealed his country had submitted a proposal to the UN for including carbon dioxide capture and storage (CCS) in the clean development mechanism (CDM) of the Kyoto protocol, allowing it to earn money for reducing global warming emissions.
CCS refers to a suite of technologies for capturing carbon dioxide and disposing of it safely underground or using it as a raw material. Carbon dioxide, the main gas responsible for global warming caused by humans, is emitted by burning coal, oil and gas. CCS is most likely to be applied to large sources of carbon dioxide, such as power stations, oil refineries and petrochemical facilities.
Carbon capture is potentially the Gulf's most important contribution to tackling climate change and can secure the future of Middle Eastern hydrocarbon resources. Without success in CCS, continuing use of the region's oil and gas will become increasingly unacceptable, undercutting the foundations of the economy.
With CCS, gas can become the "fuel of the future" - not just a bridge of a few decades until renewable energy is established but a destination that can be the backbone of the global energy economy for a century or more. Carbon dioxide can be used to scrub out more oil from mature fields, a process now being successfully tested in Abu Dhabi. It can also be used as a feedstock in chemical industries.
Countries that are proposing to establish limits on carbon dioxide emissions, such as the US and Australia, are making it increasingly clear that to prevent their polluting industries fleeing to other regions they may impose taxes on high-carbon imports. This prospect threatens Gulf exports of petrochemicals, steel, aluminium and other products.
Finally, the region's high carbon footprint is a reputational liability. Being labelled climate-change villains could imperil plans to attract tourism and investment and efforts to host international events such as Qatar's World Cup bid. Dubai's plans for coal-fired power will dramatically increase the city's emissions, unless plants are fitted with carbon capture systems.
For these reasons, establishing a viable CCS industry should be one of the GCC's two top climate change priorities, the other being energy efficiency.
But progress on carbon capture has been painfully slow. All the basic elements of the technology are well-understood and in operation somewhere around the world. Storing carbon dioxide underground has been done safely in countries including Norway, Canada and Algeria for more than a decade.
To build a full-scale carbon capture facility on a gas or coal-burning power station will, however, require several billion dollars and reduces a plant's efficiency by 30 per cent to 40 per cent. With experience and technology development, these costs will come down, hence government funding is vital to initiate the first generation of CCS plants as soon as possible.
Rather than every GCC country building its own demonstration plant at vast expense, they need to come together to share research, costs, technical learnings and perhaps carbon dioxide transport infrastructure. Recognising some of the political challenges to such co-operation Abu Dhabi, with its existing Masdar initiative on carbon capture, should at least work with the rest of the UAE, Qatar and perhaps Bahrain and Oman.
They should also establish links with other carbon capture organisations globally, such as Europe's Zero Emissions Platform. The Gulf would be a far better place for a demonstration of carbon capture on a gas-fired power plant than Europe: gas prices are lower, construction more straightforward and suitable storage sites easier to identify.
Shell recently had to cancel a carbon dioxide storage project in the Netherlands due to local opposition. Gulf residents, though, are comfortable with the oil and gas business and less likely to protest - they should be encouraged to be proud that their states are at the technological forefront of making oil and gas environmentally friendly.
The CDM or its successor could be a vital source of funding for costly CCS undertakings. In the longer term, with a reliable price for emitting carbon dioxide, carbon capture may become standard.
The Kyoto Protocol expires in 2012 but establishing the eligibility of CCS is vital for the next climate change treaty. Frustratingly slow progress on Kyoto's successor continues since the chaotic Copenhagen summit, with the next conference starting in Mexico on November 29.
Qualifying CCS for carbon credits has been controversial, opposed by environmental groups that have preferred to focus on renewable energy such as wind and solar power. Brazil has also been against its inclusion, fearing CCS would undercut demand for carbon credits it can earn for slowing the rate of domestic deforestation.
Therefore, along with the technical efforts, the GCC needs to strengthen its diplomatic efforts on CCS and climate change policy in general. Being known only as an apologist for polluting fossil fuels will be disastrous for the region's international reputation. The Gulf countries need to propose positive solutions: carbon capture and storage serves not just their interests but those of the global environment.
Robin M Mills is an energy economist based in Dubai and the author of The Myth of the Oil Crisis and Capturing Carbon