US supermajor ExxonMobil and Indonesia’s national oil company Pertamina are to evaluate the potential for the large-scale deployment of low-carbon technologies in Indonesia.

The two players have signed a memorandum of understanding to evaluate carbon capture and storage (CCS) opportunities in Indonesia.

Under the MoU, which was inked on Tuesday near the COP26 climate change summit in Glasgow, the companies will identify potential subsurface CO2 storage locations and will examine the feasibility of transporting CO2 in Southeast Asia.

The companies have also agreed to assess the potential for technologies such as carbon capture, utilisation and storage, and low-carbon hydrogen. By jointly examining subsurface data, the companies expect to identify geologic formations deep underground that could be suitable to safely store CO2, and the potential for safe, commercially viable utilisation of CO2.

CCS technology will be applied through the application of CO2 injection into the subsurface, said Pertamina, adding the technology is to be applied to depleted reservoirs in its working areas, while it will also assess the potential for hubs and cluster schemes.

Dwi Soetjipto, the head of Indonesia's upstream regulator SKK Migas, late last month told reporters that ExxonMobil is planning a CCS project at its giant producing Cepu asset onshore Java; while the Asian Development Bank has outlined the Sukowati and Gundih fields in the vicinity as locations for such pilot schemes.

However, the US operator is not known to have ever confirmed that Cepu is officially on its CCS hitlist.

“We are evaluating large-scale carbon capture and storage projects that have the potential to make the greatest impact in the highest-emitting sectors around the world, and there are opportunities in Indonesia and throughout Southeast Asia,” said Joe Blommaert, president of ExxonMobil Low Carbon Solutions.

“With well-designed policies and industry collaboration, we can move forward with reliable, safe and ready-to-deploy technologies at scale that can help governments achieve game-changing emissions reductions.”

The collaboration, which is intended to advance Indonesia’s net zero ambitions, is expected to include research and development studies with universities.

"The application of CCUS technology is part of Pertamina's energy transition to clean energy agenda. This low-carbon technology will support our business sustainability in the future," said Pertamina president director Nicke Widyawati.

The application of this technology can also be applied to the production of blue hydrogen in combination with CCS technology, added Pertamina.

The Gundih project is one of Pertamina’s stated initiatives to reduce carbon emissions and has the potential to slash emissions by 300,000 tonnes per annum of CO2 — or 3 million tonnes over a decade — while also having the potential to boost gas production at the onshore field.

The stored CO2 will be stated as carbon credits that will be shared between the governments of Indonesia and Japan.

Indonesia's Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Panjaitan, said the collaboration announced on Tuesday would strengthen the sustainable strategic partnership between Pertamina and ExxonMobil, which has existed since the 1970s in the upstream and downstream sectors.

"The opportunities that the two companies are evaluating in Indonesia, coupled with the right government policies and industry collaboration, will have the potential to make the greatest impact in the highest-emitting sectors, not just in Indonesia but also in Southeast Asia," he said.

Upstream on 29 July reported that Indonesia’s government is drafting regulations related to CCS and CCUS for the oil and gas industry, with the aim of not only supporting the development of such technologies but also addressing safety and the economic aspects.

ExxonMobil’s Low Carbon Solutions business aims to commercialise low-emission technologies. It is initially focusing its CCS efforts on point-source emissions, the process of capturing CO2 from industrial activity that would otherwise be released into the atmosphere and injecting it into deep underground geologic formations for safe, secure and permanent storage.

Other CCS locations on its radar include LaBarge and Houston in the US, Rotterdam in the Netherlands and Normandy in France.

The business is also pursuing strategic investments in biofuels and hydrogen to bring those lower-emissions energy technologies to scale for hard-to-decarbonise sectors of the global economy.

The US heavyweight today has an equity share in approximately 20% of global CO2 capture capacity and has captured approximately 40% of all the captured anthropogenic CO2 in the world.

The International Energy Agency forecasts CCS could mitigate up to 15% of global emissions by 2040, while the IPCC estimates global decarbonisation efforts could be twice as expensive without its wide-scale deployment.

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