Maersk Drilling has entered into a framework agreement with the Nini joint venture for work on Phase 2 of the Greensand offshore carbon storage project in Denmark.

The Danish drilling contractor’s agreement covers the supply of drilling rigs for the project to Nini, which is operated by Ineos and Wintershall Dea.

The deal confirms Maersk as the preferred contractor with a right to undertake all the drilling rig work involved in Project Greensand on market-rate terms until the end of 2027.

However, the agreement is subject to the project obtaining the necessary funding and final investment decision.

Maersk hailed project Greensand as the most mature carbon capture and storage project inside Danish jurisdiction.

It is targeting the development of capacity to permanently store up to 8 million tonnes per annum of carbon dioxide from 2030, thereby potentially accounting for all the CO2 storage proposed in the Danish Climate Programme as presented by the Danish government in 2020.

The CO2 will be captured onshore and transported to sea to be injected into discontinued oil and gas reservoirs beneath the Danish North Sea.

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In Greensand Phase 1, the four initial consortium partners, including Maersk Drilling, demonstrated the conceptual feasibility of developing an offshore CO2 storage site at the Nini West field.

This assessment was independently certified by the DNV classification society. Following the successful completion of Phase 1, Greensand Phase 2 was announced in August 2021, now involving an expanded consortium of 29 companies, research institutes and universities that represent all parts of the prospective carbon capture and storage value chain.

During Phase 2, the project will enter the pilot phase where the first on-site injection test is expected to commence offshore by the end of 2022, if the necessary aid for the execution of the pilot is granted via Denmark’s Energy Technology Development & Demonstration Programme.

The goal is to have the first fully operational injection wells with an annual injection capacity of 500,000 to 1.5 million tonnes CO2 ready in 2025, pending the final investment decision and regulatory implementation of the agreements outlined in the December 2020 Danish North Sea Agreement.

Maersk will contribute knowhow, manpower and a cash investment to Greensand Phase 2, as well as supplying a drilling rig to assist with the pilot test.

“We’re thrilled to see Greensand move into Phase 2 where we will be headed out to sea to test the concept in practice," said Marika Reis, Maersk Drilling's chief innovation officer.

"We now have confirmation that the Danish North Sea is very well suited for permanent CO2 storage due to its geological structure and reservoir properties, and we believe that a highly interesting carbon management market is in the early stages of development with activities in many offshore regions.

“There are obviously still technological, financial and regulatory hurdles to overcome, but carbon capture and storage has a clear potential to effectively deliver significant positive impact for the climate, and Maersk Drilling’s competencies and capabilities are a very good match for this,” she added.

Claus Bachmann, who heads Maersk Drilling’s head of North Sea, added: “This will be an exciting new challenge for our highly skilled crews and will provide an opportunity to utilise our rigs for different purposes while adding new capabilities to our portfolio. The North Sea holds the potential to become an important centre for carbon capture and storage.”